Proper tightening of the fuel sending unit plastic collar-type lock ring was a known problem area. There was even a recall associated with this for certain models. If you under-tighten these lock rings you risk fuel/vapor seepage at the top of the tank. If you over-tighten them you will jump the threads, which in turn can expand the collar and round the threads, making it difficult to properly tighten them. A new lock ring was normally required. But with the following simple procedures, most locking rings can successfully be re-used unless the threads are badly worn or the ring is badly misshapen. It's also the procedure that should be followed for new locking rings to properly tighten them and prevent damage in the first place. I started doing this when I was having problems re-installing the sending unit in my 89 740 and posted it here many eons ago. Volvo later started using the same fix (possibly a case of great minds thinking alike).

o Make sure the tank neck rubber gasket is clean and properly seated all the way around, i.e. no puckers or folds.
o Wipe out the thread area inside the lock ring collar and clean the thread area on the tank neck as needed.
o Make sure the mating surfaces on the top of the rubber gasket and the back of the sending unit face plate are clean. You can wipe a thin film of something like petroleum jelly around the top of the rubber gasket if you want to, but this really shouldn't be needed. Avoid lubing the threads.
o Make sure the sending unit face plate is going to sit nice and flat on the rubber gasket. If needed, bump the sending unit up and down a bit to help you position the end of the unit which will typically be resting on the bottom of the anti-splash bucket in the tank.
o And now for the secret ingredient. If there isn't one already present, go get a 5" stainless steel ring clamp from your favorite hardware store (most big-box stores like HD normally have them). I know the earlier (as in pre-1990) 700's didn't come with them, but Volvo did put them on the 900's, at least the later ones.
o Position the steel ring clamp on the lock ring (open the ring right up as needed) and lightly tighten to hold in place.
o Hand thread the lock ring onto the tank neck, but don't tighten it just yet.
o If you're having trouble starting the lock ring thread then here are some tips. To help avoid mis-threading, hold it on as level as you can and slowly turn it backwards (counter-clockwise) until you feel the ends of the threads jump/click, then start threading it on (clockwise). As noted above, clean the thread areas as best you can and only lube the threads as a last resort as this will just encourage over-tightening and thread jumping. Normally the lock rings aren't noticeably misshapen, but you can always run them under hot water (or apply hot rags) to make them more flexible if you think that will help. Don't use heat guns/hair driers near the tank to avoid the risk of explosion.
o Moderately tighten the steel ring clamp around the base of the lock ring collar (just above the bottom lip). Tighten it enough so that the ring won't expand during further hand tightening. If the lock ring has been previously jumping threads or you've had leaks then tighten the ring clamp a bit more to slightly compress the lock ring collar. Just make sure you can still hand turn it.
o Moderately tighten the lock ring by hand. Inspect around the inside of the lock ring. Make sure the gap between the bottom edge of the lock ring and the face of the sending unit is the same all the way around. If not then the sending unit isn't positioned flat on the rubber neck gasket -start again.
o Now hand tighten the lock ring as far as you can. If the threads jump, either tighten the steel ring clamp and try again or get a new lock ring.
o The lock ring is only supposed to be hand tightened, but as you're working through the access hatch you really aren't able to get as good a grip on it as needed and will want to tighten it a bit more.
o Tighten the steel ring clamp further to compress the lock ring collar enough to prevent the threads from jumping during the final tightening.
o Using a hammer and a wood stick (or whatever) as a drift, work around the outside ring at an angle lightly tapping the ridges a bit to further tighten it just to the point where you feel you've accomplished the next stage of tightening -typically another 1/8-1/4 turn. If you go 1/2 turn or more then either it wasn't fully hand tightened or you may have gone too far.
o Finally, really tighten that steel ring clamp to compress the lock ring collar around the neck.

That should do it.

Next time you gas-up, fill it close to the top. If you smell gas fumes under the left rear wheel well over the next few days (or the next hot day) then you likely haven't got the sending unit properly sealed. Open the access hatch and look for fresh stains on top of the tank. Re-seat and re-tighten as needed. If all else fails, get a new lock ring and/or rubber neck gasket.
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Dave -940's, prev 740/240/140/120 You'd think I'd have learned by now