Senior earned-income credit age rises to 67 in 2027 budget

Workers who turn 67 during 2027 will stay one more year in the ordinary jobbskatteavdrag instead of moving to the senior credit.Riksdagen The 2027 budget bill raises the age limit for the senior credit from 66 to 67Riksdagen, so only people who have filled 67 at the start of the year qualify for itRiksdagen. The change amends 67 kap. 7 and 8 §§ inkomstskattelagen (1999:1229)Riksdagen: the ordinary credit's age span grows by one yearRiksdagen while the senior credit's threshold moves up in step.

The reason is alignment. The age limit for the förhöjt grundavdrag rises to 67 on 1 January 2027RiksdagenRiksdagen to track the pension system's riktålder, and the government wants the two limits to move together rather than leave 66-year-olds under one regime for basic allowance and another for the earned-income credit. Keeping them apart would, in the bill's words, partly undo the purpose of the pension-age increases — a new, higher retirement-age norm reflecting life expectancy — and add complexity to the tax system. The senior limit was last raised, from 65 to 66, on 1 January 2024Riksdagen on the same alignment logic.

Only one birth cohort is affected in the introduction year: people born in 1960RiksdagenRiksdagen. Under current rules they would have received the senior credit for 2027Riksdagen; under the proposal they receive the ordinary credit insteadRiksdagen. The bill carries only the age increaseRiksdagen: the Finance Ministry memorandum behind it also proposed a SEK 460 million reinforcement of the senior creditRiksdagen, but that part is not in this billRiksdagen.

Winners and losers split by earnings. Because the ordinary credit's maximum exceeds the senior credit'sRiksdagen, high earners gain, while low earners lose because the senior credit phases in faster at low earningsRiksdagen. About 30,000 people in the cohort face on average just under SEK 3,200 a year in higher taxRiksdagen, while roughly 23,000 face on average just under SEK 9,200 a year in lower taxRiksdagenRiksdagen. Whether a given 1960-born worker gains or loses also depends on pension income alongside earnings: with only earnings of SEK 500,000 the bill's own example shows SEK 15,243 lower taxRiksdagen, while at SEK 200,000 of earnings the tax risesRiksdagen. The public-finance cost is SEK 120 million a yearRiksdagen with no effect on municipalities or regionsRiksdagen, since credits do not touch the taxable base, and Skatteverket applies the credit automaticallySkatteverket so no new paperwork arises for employers or the self-employedRiksdagen.

Work incentives strengthen on averageRiksdagen but weaken at the bottomRiksdagen. At average earnings and pensions the financial gain from working rises by about SEK 2,400 a year for women and SEK 7,900 for menRiksdagen, while low earners face weaker incentives as their tax rises. Aggregate employment effects are expected to be insignificantRiksdagen since a single cohort is touched. Women make up just over half of those facing higher tax and face slightly larger average increases than men; among those facing lower tax, men are the majority and gain slightly more on average — so measured economic equality narrows by a very small margin.

A majority of consultation bodies support the increaseRiksdagen, among them Arbetsförmedlingen, Företagarna, IFAU and Näringslivets Skattedelegation. Konjunkturinstitutet and Statskontoret want the limit tied to the riktålder so future rises happen automatically; pensioners' organisations and Pensionsmyndigheten would rather keep 66; LO and PRO oppose the whole age differentiation and want pensions and wages taxed identically regardless of age. Lagrådet was not consulted, the bill being of a technical character.

Legal basis: Prop. 2026/27:1Riksdagen with amendments to 67 kap. 7–8 §§ inkomstskattelagen (1999:1229)Riksdagen.