The interest tax deduction — how it works, what it saves, and what changes in 2026

The interest tax deduction (ränteavdrag) is technically a tax reduction that arises from a deficit in the capital income category (underskott av kapital). Your interest expenses are first offset against your capital income (savings account interest, dividends, capital gains). Only if the interest exceeds the capital income does a deficit arise, and it is on that deficit you receive the tax reduction. This applies to secured loans: mortgages, car loans with the vehicle as collateral, loans secured by securities, and more. For most mortgage holders with limited capital income, the effect is greatest.

How it is calculated

Sweden uses a two-tier system: 30% tax reduction on a capital deficit up to SEK 100,000 per person per year, and 21% on the portion above SEK 100,000.

Mortgage SEK 3 million, interest rate 4%, no capital income:

Item	Amount
Annual interest cost	120,000
Capital deficit	120,000
Reduction 30% on the first 100,000	30,000
Reduction 21% on the remaining 20,000	4,200
Total tax reduction	34,200/year
Net cost per month	7,150 (vs. 10,000 without the deduction)

SEK 2,850 per month back in your wallet. If you have capital income, the deficit shrinks and so does the reduction. For example, if you have SEK 30,000 in capital income during the year, the deficit becomes SEK 90,000 instead of 120,000 and the entire reduction is calculated at 30%.

The SEK 100,000 threshold applies per person. With a joint loan of SEK 3 million at 4% interest, the annual interest cost is SEK 120,000. If one person bears the loan alone, SEK 20,000 falls above the threshold and receives only 21% instead of 30%. If two people share the loan, the interest is SEK 60,000 per person — both stay below the threshold and get 30% on the full amount. Net effect: SEK 1,800 more per year, simply by having both names on the loan.

You can also redistribute the interest expenses in your tax return, without the split needing to match how the loan is actually divided. The requirement is that both parties are liable for the loan and that you are spouses, cohabiting partners with shared children, or cohabiting partners who were previously married to each other. Adjust the amount at item 8.1 in the Income Tax Return 1 e-service, or notify the bank in advance so the correct split is reported directly.

Tax adjustment and changing rules in 2026

Without tax adjustment (jämkning), you pay the full interest throughout the year and receive the tax reduction via your tax refund — often 6–18 months later. In practice, you are giving the state an interest-free loan. With tax adjustment, you apply to the Swedish Tax Agency (Skatteverket) for reduced tax on your salary directly: log in with BankID, apply for an adjustment for “capital deficit” and enter your estimated annual interest cost. In the example above: SEK 2,850 more in your wallet every month, without having to wait.

An important change takes effect from the 2025 income year: unsecured loans (blancolån, personal loans, credit card debt, bridging loans, etc.) receive only half the deduction. From the 2026 income year, the deduction disappears entirely for these loans. What matters is not what the money was used for, but whether the loan has pledged collateral. Mortgages secured by the property, car loans with the vehicle as collateral, and loans secured by securities are unaffected.

Anyone who financed their down payment with a personal loan (privatlån) is affected: the personal loan has no pledged collateral, regardless of the fact that the money went towards a property purchase. If you can move that debt into the mortgage (expand the mortgage), you keep the deduction entitlement and likely get a lower interest rate.

Note also that Swedish student loans (CSN-lån) have never qualified for the interest tax deduction. Instead, the student loan interest rate is already subsidised by 30% by the state, which corresponds to the same effect.

The interest tax deduction is one of the items that makes the actual housing cost always lower than what the gross interest rate suggests.

Test how the tax deduction changes at different interest rates and loan sizes, and see your housing cost before and after the deduction. In BoKalk the deduction is calculated automatically as part of the full calculation.

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Christoffer, founder BoKalk