Norway: Business Environment
A 12% rate applies to domestic passenger transport, hotel accommodation, museums, amusement parks and cinema tickets, sports events, television licenses. Please note that, due to the COVID-19 pandemic, the rate has been reduced to 6% for accommodation, leisure and transport until 30 June 2021.
Certain goods and services are zero-rated, including exports, supplies to foreign ships and aircraft and ships involved in foreign trade, books and newspapers, the transfer of a business as a going concern, and international transportation services.
A NOK 0.013 per kWh natural resource tax applies to hydro power activities, based on one-seventh of the produced kWh for the income year in question and the six previous years.
Losses may be carried forward indefinitely. Carryback of losses is permitted for losses incurred in the year of ceasing business (up to two years).
Entities within the financial services sector are usually subject to a special payroll tax. The tax rate is 5% and shall be calculated on the wage base. The tax is payable by companies where the employees spend more than 30% of their time on VAT-exempt financial services.
Some institutional holders - including mutual insurance companies, taxable pension funds, self-owned finance institutions, savings banks, co-operatives, mortgage credit associations - pay a 0.25% net wealth tax.
In certain cases, an exit tax calculated by reference to the accrued but unrealised gains at the time of migration is levied at a rate of 22% upon the migration of assets or liabilities.
A NOK 0.013 per kWh natural resource tax applies to hydro power activities, based on one-seventh of the produced kWh for the income year in question and the six previous years.
Norway | OECD | United States | Germany | |
Number of Payments of Taxes per Year | 5.0 | 10.1 | 10.6 | 9.0 |
Time Taken For Administrative Formalities (Hours) | 79.0 | 163.6 | 175.0 | 218.0 |
Total Share of Taxes (% of Profit) | 36.2 | 41.6 | 36.6 | 48.8 |
Source: Doing Business, Latest available data.
Municipal and National Tax Rate on Net Income (general income) | A combined municipal and national rate of 22% applies to net income |
Personal Income Tax | If an individual's gross income exceeds NOK 190,349 a year or gross NOK 15,862 a month, a progressive bracket tax is levied on top of the 22% income tax. The tax rates for the bracket tax 2022 range from 0% to 17.4% |
Between NOK 0 and NOK 190,349 | 0% |
Between NOK 190,350 and NOK 267,899 |
1.7% |
Between NOK 267,900 and NOK 643,799 | 4% |
Between NOK 643,800 and NOK 969,199 | 13.4% |
Between NOK 969,199 and NOK 1,999,999 | 16.4% |
Exceeding NOK 1,999,999 | 17.4% |
Top marginal rate | 39.4% (22% + 17.4%) |
As an alternative to deductions for actual expenses, an individual taxpayer may claim a standard deduction - called minimum deduction ("minstefradrag") - amounting to 46% of the basis, between a minimum of NOK 4,000 and a maximum of NOK 109,850 (2022).
A PAYE scheme applies to limited tax liable non-resident workers who have a salary below bracket tax level 3 (NOK 643,799 in FY 2022), with a flat 25% rate (including 8% social security contributions). Where PAYE applies, deductions are not applicable.
A special tax rate applies to foreign artists and athletes (15% - "Foreign Artist Tax Act"). Social security exemptions are also provided for qualifying foreign citizens with short-term employment in Norway.
Foreigners who become tax residents are entitled to a standard deduction of 10% of taxable salary, limited to NOK 40,000 for the first two tax assessments. In general, this standard deduction replaces all other deductions except the personal deduction and the minimum deduction. Please note that from 2019 this deduction is limited to foreign seafarers and shelf workers only.
For further details, refer to the Norwegian Tax Administration website.
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Latest Update: March 2023