Conditional or unconditional shareholder contribution – what is the difference?

Fact-checked: October 1, 2026 · Swedish law and accounting

The crucial difference between a conditional and an unconditional shareholder contribution is the right to future repayment. In terms of accounting, however, both forms are treated as equity when they are genuinely shareholder contributions.

Unconditional shareholder contribution

An unconditional contribution is provided without any requirement for repayment. The capital remains in the company and strengthens the unrestricted equity. For the donor, this generally means, for tax purposes, that the cost basis of the shares increases.

It is often suitable when the owner intends to permanently strengthen the company's capital or when there is no intention for the money to be reclaimed later based on a specific right of repayment.

Conditional shareholder contribution

A conditional contribution includes a reservation for future repayment. The Swedish Accounting Standards Board (BFN) explains that the agreement normally binds the shareholders but not the company, and that repayment is contingent upon a future resolution by the general meeting.

This is important: a conditional shareholder contribution is not the same as an ordinary loan. If the contributor instead has an unconditional right to repayment directly against the company, the transaction may be considered a liability from an accounting perspective.

How are the two types reported?

The BFN's K2 regulations state that a received shareholder contribution should increase the item "Retained earnings" when the commitment is received. The commentary expressly states that both conditional and unconditional contributions are reported in this manner.

When the competent body subsequently makes a decision to repay a conditional contribution, unrestricted equity shall be reduced.

How does the tax differ?

Unconditional

The Swedish Tax Agency states that an unconditional contribution is generally counted as an improvement expense and may be included in the cost basis of the shares. The main principle is simultaneously that the receiving company is not taxed for the contribution.

Conditional

The conditional contribution is normally not added to the shares' cost basis. The right to repayment is treated separately and can be transferred separately from the shares. The repayment is handled under civil law as a transfer of value but is normally treated as the repayment of a loan for tax purposes.

Which type is suitable for capital deficiency?

Both conditional and unconditional contributions can strengthen equity and thus be relevant in cases of capital deficiency. BFN mentions shareholder contributions as a way to restore consumed share capital. However, the choice between the forms should not be made solely based on the effect on the control balance sheet (KBR), but also based on the owners' long-term intention, tax, and future dividend potential.

Read also Shareholder contributions step by step and Control balance sheet – questions and answers.

Checklist before you choose

• Should the money be possible to repay later?
• Are there multiple shareholders who need to regulate mutual priority?
• How does the choice affect the shares' cost basis?
• Is the documentation clear regarding whom the repayment condition binds?
• Is the purpose to manage an ongoing capital deficiency?
• Do accounting or tax advisors need to review the arrangement?

Sources

• Swedish Tax Agency – Shareholder contributions
• Swedish Tax Agency – Capital gain calculation and cost basis
• BFN – K2 chapter 15