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Finding somewhere to live, finding a job and making sure that your new home has everything you need….but what about Finance and Tax in Norway?
A new life, a new adventure. It’s all very exciting, but at the same time, there is almost definitely an element of worry. You are, after all, relocating to a new country that you might not be altogether familiar with.
From finding somewhere to live and work to making sure you choose the right school for your children, there is a lot to do.
As well as these important tasks it is also wise to get familiar with the finance and tax in Norway. How do they apply to you? Make sure that you research the income tax rates, social security contributions, corporate tax and anything else that might apply to you.
Many countries have different types of taxes ranging from state to municipal and even parish taxes, so you need to do you research.
We take a look at the basics of finance and tax in Norway to give you a little more insight.
Tax obligations when moving to a new country
First of all, are you going to be employed or self-employed?
This will determine the administration tasks required of you. You also need to find out if you need to self-assess. Some countries will expect new citizens to self-assess even if employed. Make sure you find out if this applies to you.
Next, you need to find out what the social security contributions are and what you are entitled to. If you are moving from the EU, you are likely to have covered already for a certain amount of time. Are you required to be a citizen for a minimum term before you are eligible for social security benefits?
If you are self-employed, you need to ensure that you have the correct visas and permits to carry out your business. You will be expected to register yourself as self-employed and then to submit a tax return.
If you have a business are you moving it to Norway or are you just opening a new branch or office? Don’t forget the obligations of your current country. You will need to inform the authorities of your new address. They will also need to know that you are leaving the country.
If you are moving part way through a tax year, you will be required to submit a tax return for the time that you did work.
If you were employed, you may be entitled to a refund if you were on a PAYE scheme.
Also, consider the long term and whether you might return one day. You may need to keep up social security payments.
All of these things will largely depend on the rules of your current country.
Income tax rates in Norway
Income tax in Norway is charged at a combined national and municipal rate of 27%.
There is then a sur-tax charge of between 9% and 12%. The rate you pay depends on your income.
If you are self-employed the income tax rates are the same however, you must file a tax return. Tax is payable quarterly, and in advance, and you must register as self-employed.
If you are employed, then your employer should register for you however, you will still need to submit a tax return.
Each month you should receive a breakdown from your employer of your earnings and taxes paid. You need to keep these ready for filing your tax return. This will be sent to you, and you will need to check it.
If there are any changes, you will need to file them. You must check it carefully for any mistakes and that your details are correct.
The tax office will also need your bank account details in case of a refund owed.
Social security in Norway
If you are working in Norway as a permanent employee and are paying tax, then you are automatically a member of the National Insurance Scheme.
It is the employer’s responsibility to register you and ensure contributions are paid.
Employee contributions in Norway are 8.2%.
The ‘NAV’ scheme, as it is known, covers unemployment, sickness, pensions, health services and family benefits as well as other state benefits.
Finding somewhere to live, finding a job and making sure that your new home has everything you need….but what about Finance and Tax in Norway?
It is important to note that you need to have been a member of the scheme for a certain amount of time before you can claim. This is extremely important for those that are new to the country.
Corporate tax in Norway
Corporate tax in Norway is currently 24% having reduced gradually over the last decade from 28%.
Tax returns must be submitted online and by the 31st May the following year.
The forms that you need to submit vary depending on whether your business is a resident business of Norway or if you are submitting returns just for a Norway branch or office.
Before you start trading in Norway (if you don’t already) it is important that you look into finance and tax in Norway requirements for trading. What permits and authorisations do you need and which forms should you be filling in?
A professional advisor should be able to help you with this.
VAT in Norway
While Norway is not a member of the EU, the VAT follows similar guidelines to those laid out by the EU.
The standard VAT rate is 25%.
There are then reduced rates and exemptions. The reduced rates are 15% and 8% and apply to things like food and transport services with a special rate of 11.11% on raw fish.
Companies in Norway must register for VAT when their turnover exceeds NOK50,000. Returns are then filed either bi-monthly or annually. This depends on the turnover of the company.
Other Norwegian taxes
So what are the other things to note when it comes to finance and tax in Norway?
Well in addition to income tax, social security, corporate tax and VAT there are other taxes. These are notably wealth tax and property tax. There was an inheritance and gift tax, but this was abolished as it has been in many European countries.
If you are unsure as to how these taxes apply to you or how to register for them, there is plenty of help and advice available online.
Alternatively, you can seek the advice of a professional accountant/tax advisor to make sure that you have all of the relevant information before you move.
Having everything prepared will make the transition into your new life so much easier.