Expatriate tax ebook - Norway

What taxes?
Capital gains tax
Inheritance, estate and gift taxes
Investment income
Local taxes
Real estate taxes
Social security taxes
Stock options
Wealth taxes
Other specific taxes

Capital gains tax
Chargeable gains are subject to Capital Gains Tax in Norway at 28%. Exemptions to Capital Gains Tax apply in respect to gains arising from the sale of a principal residence subject to certain conditions.

Exit Tax
An exit tax is applied to gains on sales of shares in excess of NOK 500,000 subject to certain conditions.

Inheritance, estate & gift taxes
Inheritance and gift taxes are paid on all inheritances and gifts received from resident decedents and donors. Real estate and related assets in Norway are subject to this tax, regardless of the donor's residence or citizenship. Inheritances and gifts received from a spouse are not subject to such tax.

Investment income
From 2006 there are new rules on the taxation of dividends paid to individuals. Only the part of the dividend exceeding a risk-free return of the investment is taxable. These rules also apply to citizens of another EEA country.

Local taxes
There is a local municipal tax that is levied in addition to State income tax.

Real estate tax
• Registration fee and stamp duty on transfer of ownership, 2.5% of market value.
• This favours lease before purchase of accommodation. This is particularly so if the stay in Norway is temporary.

Social security taxes
Any individual working in Norway must pay a national insurance contribution of 7.8% of his personal/gross income. The national insurance contribution will be assessed and paid with the ordinary income tax and the top tax.

Any foreign taxpayer who is resident, or if not resident, under employment in Norway, may be exempted from the National Insurance Scheme in accordance with EEA regulations No 1408/71 or a Social Security Convention.

Employers must pay the employer's contribution to the National Insurance Scheme. The contribution is stipulated as a percentage of wages and remunerations. The ordinary rate is 14.1%.

Also foreign employers are obliged to pay the Norwegian employer's contribution on wages and remuneration for work performed in Norway and on the Norwegian continental shelf. This applies regardless of whether the foreign employer is tax liable to Norway or not, and regardless of whether the employee is liable to tax in Norway or not.

If the employee submits the E101 form from the national insurance authorities in his home country, the employer does not need to pay the Norwegian employer's contribution.

Stock options
Stock options received by an individual will become liable to tax in Norway on the date of exercise. The amount of tax due is calculated on the difference between the market value of the underlying share at the date of exercise and the exercise price and amount paid by the individual at the date of exercise.

Wealth tax
A wealth tax is levied on taxable net assets at the following rate:

Other specific taxes
Personal/ gross income is liable to a Top Tax where it exceeds the following limits:

Information about Norway:

• introduction
• facts and figures
• basis of taxation
• what taxes?
• tax planning opportunities