The ROT deduction in 2025: how construction companies were affected

Update September 2026: The increase to 50 per cent applied to work paid for between 12 May and 31 December 2025. Since 1 January 2026, the ROT deduction has been back at 30 per cent.

The temporary increase in the ROT deduction in 2025 opened up new opportunities, not only for private individuals wanting to renovate their homes but also for companies in construction and the skilled trades. If you run a construction company, it is important to know the rules, how the deduction affects your invoicing and how to handle it correctly in your bookkeeping.

The ROT deduction was 50 per cent during 2025: what did it mean for your business?

From 12 May to 31 December 2025, the ROT deduction was temporarily raised from 30 per cent to 50 per cent. If you run a business in construction or the skilled trades, this meant your services became even more attractive to private customers.

The rules:

• Private customers could deduct 50 per cent of the labour cost (30 per cent since 1 January 2026)

• The ceiling is still SEK 50 000 per person per year for ROT

• As a company, you invoice the customer with the ROT deduction already subtracted, and then request payment of the remainder from the Swedish Tax Agency (Skatteverket)

How to book the ROT deduction correctly

Handling ROT correctly in your bookkeeping is essential, both for your finances and to avoid errors in your tax return. Here are some points to keep track of:

• The ROT deduction is booked as a receivable from the Tax Agency until you receive the payment

• The full invoice amount, including the part the Tax Agency pays, is your income

• It is important to clearly specify the labour cost on the invoice: ROT applies only to labour, not materials

• VAT is reported on the full labour cost, and the amount you request from the Tax Agency includes VAT

A good tip is to have a structured routine for ROT invoices, especially when many customers are using the deduction.

ROT and building permits: what are the rules?

Many projects that qualify for ROT also require a building permit (bygglov) or a notification, particularly extensions or major changes to the floor plan. However, the ROT deduction is not directly affected by the building permit, but work must not begin before the local building committee (byggnadsnämnden) has issued a start notice (startbesked), if one is required.

Important for you as a business owner: Costs for preparing building permit documents, architectural drawings and similar are not covered by ROT, and must not be included in the labour cost on which the deduction is based.

Bear in mind: If a building permit is required, you often also need a quality control manager (kontrollansvarig, KA) under the Planning and Building Act (plan- och bygglagen). The cost of the KA is not covered by the ROT deduction and must be reported separately.

What did the increase mean for construction companies?

• Services became more attractive, with increased demand from private customers

• You need to keep track of invoicing, ROT reporting and the cash method (kontantprincipen)

• It may be a good time to review your internal routines and make sure that your bookkeeping handles ROT correctly

• At the same time, the increase gave a competitive advantage over undeclared work, as the subsidy made it cheaper to hire legitimate companies

Get control of ROT in your accounting

Do you have questions about how to handle ROT in your bookkeeping? Would you like help with automated accounting, ROT documentation or VAT reporting?

Book a free consultation with Ekonomico, your digital accounting firm that makes ROT easy to handle.