If you have an investment savings account (ISK) you barely need to read on: there the tax happens automatically and you report nothing per trade. But if you hold shares or funds in a regular account, you are the one who does the sums, and then it pays to get them right. It comes down to three things: work out the gain, offset any losses, and fill in the K4 form. None of it is hard once you know how.
In a regular account you pay 30% tax on the gain when you sell. The gain is the sale price minus what you paid (the cost basis). Losses can be offset against gains, fully against gains on other shares and funds. If you do not know what you paid, you can use the standard method and count 20 percent of the sale price as the cost basis. Everything is reported on form K4 in your tax return, and most of it is already pre-filled.
I will cover when the tax arises, how to work out the gain, when the standard method pays off, how offsetting works and how the K4 fits together. Run your own trades in the capital gains calculator.
When the tax arises
The tax is triggered when you sell, not when the value rises. As long as you only hold, nothing happens for tax purposes, however much the holding has gone up. That is why an ISK is often simpler: there the whole holding is taxed with a small flat charge and you avoid reporting trades. In a regular account it is the sale itself that counts, and then it is also you who has to keep track of what you once paid.
How the gain is worked out
The gain is the sale price minus the cost basis, that is what you paid for the security including brokerage (courtage). If you bought the same share on several occasions at different prices, you use the average method: you add up everything you paid and divide by the number of shares, giving an average price per share. On the gain you pay 30%. Funds are worked out the same way. Your bank usually reports the sales to the Tax Agency, so much is already filled in, but the responsibility for getting it right is yours.
The standard method: when you do not know what you paid
Held a share a long time and cannot find what you paid for it? Then there is the standard method: you may use 20 percent of the sale price as the cost basis, and are taxed on the rest. It pays off when you actually paid less than 20 percent of today's price, that is on really large increases. A small example: if you sell for 100,000 kr the standard cost basis is 20,000 kr and the taxable gain 80,000 kr. If you paid more than 20,000 kr, it is better to use your real purchase price.
Offset gains against losses
This is the most important trick, and many people miss it. Losses on shares and funds may be offset in full against gains on other shares and funds the same year. If you have a gain of 60,000 kr and a loss of 20,000 kr you are taxed only on the difference, 40,000 kr. If it comes out as a net loss, it can be offset against other capital income, but only at 70 percent of the part not met by securities gains. That is why many review their holdings in December: realising a loss the same year as a gain can lower the tax in a perfectly legal way.
The K4 form and your tax return
All sales in a regular account are reported on form K4, one row per security with quantity, sale price and cost basis. In practice the bank has usually already reported the figures, so they are pre-filled when you log in to the Tax Agency; your job is to check that the cost basis is right, especially if you have moved securities between banks (the purchase price does not always follow). The offsetting between gains and losses happens automatically once everything is on the K4. The tax return is filed the year after the trades.
My recommendation
If you save long-term the real lesson is that you should ideally sit in an ISK and skip all of this, but if you have a regular account it is manageable: check that the pre-filled cost bases are right, offset losses against gains, and use the standard method only when your real purchase price was below 20 percent of the sale. Work through the trades in the capital gains calculator before the tax return. If you also sold a home the same year, read the guide to selling your home; gains and losses meet in the same tax return.