Taxation in Norway
In addition to covering joint expenses, taxes are designed to contribute to greater equality between individuals.
A distinction is drawn between direct and indirect taxes. Direct taxes comprise income tax, that is, tax deducted from our earnings from employment or business activities, interest on bank deposits etc. and wealth tax.
Indirect taxes are sometimes used as instruments to reduce our use of products that are hazardous to health or the environment. Many indirect taxes also relate to consumption. Value-added tax (VAT) is an example of this. It is a tax that we pay when we buy goods and services. It means that some of the price that we pay is in turn paid to the public purse.
Taxes make up the greater part of our local and central government’s income.
It is important that you state all that you earn in Norway, since this may be the basis for the public services to which you are subsequently entitled.
As a businessperson …
… operating in Norway, you must register with the Central Coordinating Register for Legal Entities and contact you local tax office to determine the amount of advance tax that you should pay. If you are a foreign businessperson, you must contact the Central Office – Foreign Tax Affairs in order to determine the amount of advance tax.
Anyone engaged in business in Norway must inform the tax authorities of their income, wealth and deductions in income. You do this by completing the tax return you receive in March/April in the year following the income year. If you are a foreign businessperson, you will receive your tax return from the Central Office – Foreign Tax Affairs in February.
A paper copy of the tax return for businesspersons must be submitted by 31 March, or it can be completed online by 31 May.
Remember that it is your responsibility to ensure that the Norwegian tax authorities are correctly informed about your income and wealth situation.
Once the tax office has processed your tax return, you will receive a tax settlement notice. You will be able to see on what income the tax calculation is based and if you have paid too much or not enough tax. You should check the tax settlement notice against the information you provided in your tax return. If you think that the settlement is incorrect, you may appeal the assessment. The tax settlement notice arrives in October.
As employer…
…, you must withhold tax from your employees’ pay on the basis of their tax deduction cards. Tax withholdings must be paid to the municipal treasurer or, if you are a foreign employer, to the Tax Collector – Foreign Tax Affairs.
You must also pay National Insurance contributions for those of your employees who are insured in Norway. The employer’s National Insurance contributions help to finance benefits under the National Insurance Scheme and must be paid to the same office as the tax withholdings.
If you are a foreign employer, your employees will receive a tax deduction card from the Central Office – Foreign Tax Affairs. This tax deduction card will be sent to you and not to the employee. You must give part two of the tax deduction card to the employee.
At year end, you must fill in the form Lønns- og trekkoppgave (“Certificate of pay and tax deducted”, also called ”End of year certificate”) for each of your employees. The certificate of pay and tax deducted/ End of year certificate must show the amount of salary and other remuneration paid to the employee and the amount of tax deducted.
As an employee…
… in Norway, you need to have a tax deduction card. The tax deduction card shows how much tax your employer should deduct from your pay. If you have a Norwegian employer, you will be issued with a tax deduction card from the local tax office; if you have a foreign employer, you will be issued with a tax deduction card from the Central Office – Foreign Tax Affairs. Tax deduction cards from the Central Office – Foreign Tax Affairs are sent to your employer, who is required to give you part two of your card.
Your employer will deduct a certain amount from your pay on each pay day, which will then be paid to the tax authorities via the Municipal Treasurer or, if your employer is foreign, via the Tax Collector – Foreign Tax Affairs. National Insurance contributions are normally included in the amount deducted from your pay.
When you pay National Insurance contributions to Norway, you are entitled to benefits from Norway, for example, if you fall sick. What you must do, is to make sure that your employer has received your tax deduction card. Be sure that you receive a pay slip from your employer. The pay slip is your receipt showing that tax has been deducted from your pay by your employer.
Anyone engaged in business in Norway must inform the tax authorities of their income, wealth and deductions in income. If you have a Norwegian employer, you do this by filling in the tax return you receive in March/April. The form has been pre-completed with information received from your employer among others. If you have a foreign employer, you will receive your tax return from the Central Office – Foreign Tax Affairs in February. This tax return is not pre-completed.
The purpose of the tax return is to provide the tax authorities with complete information about your income, wealth and deductions, so that the correct amount of tax can be calculated. Remember that it is your responsibility to ensure that the information you submit to the tax authorities is correct.
If you have received a pre-completed tax return, you are not required to submit your tax return, if the amounts entered in advance are correct. Otherwise the deadline for submission is 30 April.
Note that tax returns received from the Central Office – Foreign Tax Affairs must always be submitted. The deadline for submission is 31 March in the year following the income year.
When your tax return has been processed, you will receive a tax settlement notice. It contains information about the income on which tax has been calculated, how much tax your employer has deducted and whether you have paid too much or too little tax. It is important that you check the tax settlement notice against the information you provided in your tax return. If you think that the settlement is incorrect, you may appeal the assessment.
If your employer is Norwegian, you will normally receive the tax settlement notice in June. If your employer is foreign, you will receive the tax settlement notice in October.
About the Norwegian Tax Administration
The primary tasks of the Norwegian Tax Administration are to collect income and wealth tax, National Insurance contributions, value-added tax and inheritance tax. The Norwegian Tax Administration is also responsible for maintaining and updating the Population Register.
The Norwegian Tax Administration consists of the Directorate of Taxes in Oslo and local tax offices in five regions: Tax Region North, Tax Region Central Norway, Tax Region West, Tax Region South and Tax Region East.
There are also three national tax offices: the Central Office – Foreign Tax Affairs (COFTA), the Central Tax Office for Large Enterprises and the Oil Taxation Office.
The local tax office will be able to assist you, even if you are resident in another region or abroad. There is a tax appeal board for every tax office.
Together with the Labour Inspection Authority, the Police and the Directorate of Immigration (UDI), the Norwegian Tax Administration has established a joint service centre for foreign employees in Oslo. This is a visitors’ centre only, which you can contact when you are in Oslo, even if you live elsewhere in Norway or abroad. At the service centre you will be able to obtain assistance from English-speaking, Italian-speaking, Polish-speaking, Russian-speaking or Spanish-speaking staff. There are plans to open a similar centre in Stavanger in 2009. There are also plans for visitors’ centres in other parts of the country.
You can contact the Norwegian Tax Administration by calling one of the following telephone numbers:
From Norway: 800 80 000
From abroad: + 47 22 07 70 00
Central Office – Foreign Tax Affairs + 47 51 96 96 00
E-mail address of the Central Office – Foreign Tax Affairs: sfu@skatteetaten.no
Tax Collector – Foreign Tax Affairs: + 47 51 86 89 00
E-mail address of the Tax Collector – Foreign Tax Affairs: skattvest@skatteetaten.no
