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VAT and taxation in Norway

VAT and taxation in Norway

In this guide, you will be provided with an overview of applicable VAT and corporation tax rules in Norway, including registration requirements and tax filing obligations for private limited liability companies. The guide also contains information on the Norwegian rules on permanent establishment relevant to foreign companies.

This article is part of our Doing Business in Norway guide.

Introduction 

When starting a business abroad as a foreign investor, it’s important to understand Norway’s tax and Value Added Tax (“VAT”) rules. These rules apply to both Norwegian and foreign companies operating in Norway. Norway generally has a broad corporate tax base, combined with treaty relief to avoid being taxed twice. These treaties typically follow the OECD Model Convention and allocate taxing rights on business profits based on whether the foreign company has a permanent establishment (“PE”) in Norway.

VAT

VAT is a tax added to most goods and services sold in Norway and the VAT standard rate is currently 25%. Some items are exempt or subject to reduced rates. A Norwegian limited company (“AS”) must register for VAT once its taxable sales exceed a certain amount, currently NOK 50 000, within a 12-month period. The company cannot charge VAT on invoices before it is registered. Late registration can trigger interest and surcharges, so it is important to monitor turnover and apply for registration at the appropriate time. In some cases, you may apply for a VAT registration ahead of reaching the necessary turnover, if you are able to provide proof that your turnover will within a reasonable time reach the threshold. Registration and reporting is done electronically in Norway. Once registered in the Norwegian Register of Business Enterprises (“NRBE”) (Nw. “Foretaksregisteret”), the company must add VAT to its sales (output VAT) and can usually deduct VAT paid on business purchases (input VAT).
 
Foreign companies doing business in Norway that are subject to VAT may also need to register for VAT, either directly or through a Norwegian VAT representative. The requirement depends on the company’s country of establishment and the nature of its Norwegian activities.

Corporate income tax

Companies that are tax resident in Norway are subject to corporate income tax on their worldwide income and assets. A company is regarded as resident in Norway when it is incorporated under Norwegian law and registered in the NRBE or its central management and control is carried out in Norway. In the assessment of central management and control, the company’s activities and organisation will also be considered.
 
Any company that is considered “tax resident” in Norway must pay corporate income tax on all their worldwide income and assets. The corporate tax rate is currently at 22%. The standard corporate tax is calculated on the company’s net profit for the year. Normally, companies pay this tax in two instalments during the first half of the year after the income was earned, in addition a third payment is made after the final tax calculation is completed, with the payment being the difference between the tax paid and the tax due. Payment is reported and made electronically in the same way as VAT. Interest is charged on residual tax.
 
Most costs incurred while earning a taxable income are deductible before corporate income tax is calculated. Special rules apply to entertainment, certain donations, and intra-group interest. Long-lived assets costing above a specified threshold must be depreciated over their useful life rather than deducted in full in the year of acquisition.

Dividends

Dividends paid to individual shareholders are subject to dividend tax. Dividends paid to corporate shareholders are largely exempt, cf. section 2-38 of the Norwegian Tax Act (Nw. “Skatteloven”).

Foreign companies and PE

Limited tax liability

Foreign companies doing business in Norway are generally taxed only on the income they earn from these activities. This is called “limited tax liability.” Most foreign companies are also taxed in their home country, but tax treaties help prevent double taxation.

PE

If Norway can tax a foreign company’s profits usually depends on whether the company has a PE in Norway. A PE means the company has a fixed place of business (like an office or factory), is involved in a long-term project, or has an agent in Norway who regularly enters into contracts on behalf of the company. If a foreign company has no PE in Norway, its business profits are generally not taxable here (though certain Norwegian-source income may still be taxed). Norway may tax the profits attributable to a PE at the standard corporate income tax rate, treating the PE as a notionally independent enterprise for income allocation purposes.

Filing for foreign companies

Foreign companies with business activities in Norway must file a corporate tax return. If they can prove their activities do not amount to a PE, they can apply for an exemption from filing. This is an administrative measure and does not affect the underlying taxation rules applicable.
 
Norwegian companies must file an annual corporate tax return electronically, usually by 31 May the year after the income was earned, exceptions until the 30 of June is usually possible by applying. This duty to file applies even if the company had no income or was set up late in the year.

Next steps?

VAT and corporate taxation are complicated legal subjects and will usually require assistance from professionals. Tax errors can be costly, and the Norwegian Tax Authority (“NTA”) (Nw. “Skattemyndighetene“) actively pursues non-compliance. The NTA can reassess a company’s tax position (to its advantage or disadvantage) within five years of the end of the relevant income year. For serious errors or fraud, this extends to ten years. Companies may voluntarily correct previously filed returns, calculated from the end of the relevant calendar year (“voluntary correction”), but only within the last three years. However, a company may request the NTA for a qualified change up to five years prior. The deadlines for NTA changes are calculated from the end of the calendar year to which the income year applies. For example, a return filed for 2021 must be corrected by end of 2026. For a company’s voluntary changes, the deadline is based on the deadline for filing of the tax return, e.g. by 31 of May.
 
At Brækhus, we regularly advise foreign companies on taxation, please contact us today for further details and an informal chat.

Nils Eriksen
Partner

Kim Fosshaug
Partner

Last updated: 29 June 2026
 

Tax Groups and Group Contributions in Norway

Tax Groups and Group Contributions in Norway

This guide provides an introduction to the Norwegian tax group regime and the rules on group contributions (Nw. “konsernbidrag”) and outlines the key legal requirements, tax benefits, and practical implications of group contributions within corporate groups. It is not exhaustive and focuses on aspects of the regime that is relevant to foreign investors and international groups operating through multiple Norwegian entities.

This article is part of our Doing Business in Norway guide.

Introduction

One of the most strategically important features of the Norwegian corporate tax system is the ability to establish a tax group and transfer taxable income between related companies through a mechanism known as group contributions (Nw. “konsernbidrag”). For foreign investors operating or planning to operate, through multiple Norwegian entities, understanding this framework is essential to structuring the group in a tax-efficient way. This article provides a high-level overview of the legal thresholds, the key benefits, and the most common use cases.

The Norwegian Tax Act (Nw. “skatteloven”) sections 10-1 to 10-4, govern the tax treatment of group contributions. Unlike some jurisdictions that apply full consolidated group taxation, Norway taxes each company as a separate legal entity. The group contribution rules are designed to correct the resulting asymmetry by allowing profitable companies to transfer income to loss-making companies within the same group, achieving an income-equalising effect across the group.

In practical terms, a group contribution is a transfer from one group company to another. When the rules are satisfied, the contributing company (the giver) obtains a tax deduction, and the receiving company (the recipient) is taxed on the amount received, in the same income year. The net effect is that taxable income is moved from where it arises to where it is most efficiently utilised.

Key Thresholds and Eligibility Requirements

The rules are precise, and all conditions must be met by the end of the relevant income year:

  • 90% ownership threshold. Both the giver and the recipient must belong to the same corporate group as defined in the Norwegian Private Limited Liability Companies Acts (Nw. “aksjeloven”). The parent must own more than 90% of the shares and hold a corresponding proportion of voting rights. The requirement must be met by the end of the financial year to which the group contribution relates.
  • Norwegian entities as a starting point. Both parties must generally be Norwegian companies (Nw. an “AS” or “ASA”). Norwegian subsidiaries within the same Norwegian sub-group may qualify even where the ultimate parent is foreign, provided the ownership threshold is met at the Norwegian level.
  • EEA extension. Foreign EEA-resident companies may participate if they are comparable to a qualifying Norwegian entity, are subject to Norwegian tax liability, and any contribution received constitutes taxable income in Norway.
  • Income cap and symmetry. The deduction is capped at the giver’s taxable ordinary income for the year. Any excess is non-deductible for the giver and correspondingly non-taxable for the recipient.
  • Company law compliance. A group contribution must be lawful under the Private Limited Liability Companies Act. The combined total of dividends and group contributions each year cannot exceed the ceiling applicable to dividends under section 8-1 of the relevant Act.

Key Benefits

  • Immediate loss utilisation. Profits in one group company can be offset against losses in another within the same income year, recovering the full tax value of a loss immediately rather than carrying it forward with no certainty of future utilisation.
  • Participation exemption synergy. Dividends between Norwegian group companies are largely tax-exempt under the participation exemption (Nw. “fritaksmetoden”) cf. section 2-38 of the Norwegian Tax Act (Nw. “Skatteloven”). This allows income to flow upward through the structure without triggering a second layer of Norwegian corporate tax, complementing horizontal group contributions.
  • Intra-group liquidity management. Group contributions may consist of cash or other assets, giving groups meaningful flexibility in managing capital allocation within the Norwegian structure without adverse tax consequences, provided the statutory conditions are respected.

Typical Use Cases

The group contribution mechanism is particularly valuable in the following scenarios:

  • Acquisition structures – where a holding company carries acquisition debt and incurs interest costs, and a profitable operating subsidiary contributes taxable income upward so the holding company can utilise its interest deductions.
  • Start-up and development phases – where a newly established Norwegian subsidiary accumulate losses during a ramp-up period, and a profitable group company offsets those losses in real time.
  • Post-acquisition integration – following an M&A transaction, the acquirer can use group contributions to neutralise historical or transitional losses in acquired entities, increase tax EBITDA to facilitate for increased interest cost deductions, etc.
  • Multi-entity operational groups – groups operating several Norwegian subsidiaries across different business lines commonly use group contributions at year-end to consolidate the Norwegian tax position before the income year closes.

A Note on Cross-Border Contributions

As a general rule, group contributions apply only between Norwegian-resident entities. However, following EFTA Court jurisprudence and subsequent legislative reform, a Norwegian parent may in narrow circumstances claim a deduction for a contribution to an EEA-resident subsidiary with a final and irrecoverable loss – one that cannot be utilised by the subsidiary or any other entity in its state of residence. The conditions are strict, and the subsidiary must generally be in liquidation by year-end.

Next Steps

Navigating Norwegian tax group rules requires careful upfront structuring. The 90% threshold must be precisely maintained, contributions must be properly documented in compliance with company law formalities, and the interaction with interest limitation rules (section 6-41 of the Tax Act) must be assessed where the group carries significant debt.

At Brækhus, we regularly advise domestic and international clients on corporate tax structuring, including the establishment and optimisation of Norwegian tax groups. Contact us today at for an informal conversation about how these rules apply to your business.

Kim Fosshaug
Partner

Truls Bache
Lawyer

Last updated: 29 June 2026

Bookkeeping, financial statements and audit obligations for a Norwegian branch of a foreign enterprise (NUF)

Bookkeeping, financial statements and audit obligations for a Norwegian branch of a foreign enterprise (NUF)

This article gives a high-level overview of NUFs bookkeeping obligations, financial statement obligations and audit obligations in Norway. The exact applicable obligations depend on legal form, size, tax position and any special regulations.

This article is part of our Doing Business in Norway guide.

Bookkeeping obligation

Bookkeeping obligation means the duty to maintain accounting records in accordance with Norwegian bookkeeping rules. In practice, the business must document purchases, sales, payroll, VAT and other transactions affecting the Norwegian activity.

As a general starting point, enterprises that conduct business activities and must submit tax returns and/or VAT returns to Norwegian authorities will be subject to bookkeeping obligations. Enterprises with financial statement obligations will also normally be subject to bookkeeping obligations.

A NUF, a foreign company carrying out taxable business activity in Norway, will usually need to keep books for the Norwegian branch. The records must support Norwegian tax filings, VAT filings, employer reporting and other statutory reporting obligations.

The bookkeeping rules include requirements for documentation and storage of accounting material. Accounting material must generally be stored for five years, but certain documentation may need to be stored for longer and in some cases up to ten years. The books must be updated in time for relevant reporting deadlines. For example, a VAT-registered business submitting VAT returns every second month must keep its bookkeeping updated in line with those periods.

For NUFs, it is normally not necessary to use a Norwegian bookkeeping software. It may be sufficient to use the same system as the foreign head office or main company, provided that each transaction relating to the Norwegian branch can be clearly identified, documented and separated from other activity. The system should be able to produce reliable branch-specific reports for Norwegian tax, VAT, payroll and other reporting purposes.

Financial statement obligation

Financial statement obligation is separate from bookkeeping obligation. While bookkeeping concerns the ongoing recording and documentation of transactions, financial statement obligation concerns the duty to prepare annual financial statements. Annual financial statements will normally include at least an income statement, balance sheet and notes. Larger businesses may also need a directors’ report, cash flow statement and, in some cases, sustainability reporting.

Whether a business has a financial statement obligation depends on factors such as legal form and tax status. For NUFs, the position requires a specific assessment. A NUF may be subject to Norwegian financial statement obligations depending on the scope of the Norwegian activity and whether the branch is tax liable to Norway. Even where annual financial statements are not filed in the same way as for a Norweigan private limited liability company, the NUF still need bookkeeping records that form the basis for Norwegian tax and VAT reporting.

Foreign companies should therefore not assume that a branch registration automatically means fewer compliance obligations.

Audit obligation

Audit obligation means that the annual financial statements must be audited by an approved auditor. If audit is required, the auditor reviews the accounts and issues an audit report, which is submitted together with the annual financial statements where filing is required.

For NUFs, audit obligation is particularly important. A NUF that is taxable to Norway will generally be subject to audit if one of the relevant thresholds is exceeded: revenue above MNOK 7, balance sheet assets above MNOK 27, or an average number of employees exceeding ten full-time equivalents. NUFs subject to supervision by the Norwegian SEC may be audit liable regardless of these thresholds.

Even where annual financial statements are not subject to statutory audit, specific transactions or public support schemes may require an auditor’s confirmation. For example, certain capital contributions, grants or regulated activities may require separate auditor statements.

Practical considerations for foreign businesses

Before starting activity in Norway, foreign companies should consider:

  • whether the business should operate through a NUF or incorporate a Norwegian AS;
  • whether the planned activity triggers tax liability, VAT registration or employer registration in Norway;
  • whether Norwegian bookkeeping routines must be established from day one;
  • whether annual financial statements must be prepared and filed in Norway;
  • whether the business is, or may become, subject to statutory audit; and
  • whether contracts, invoicing flows and intercompany arrangements are aligned with Norwegian requirements.

These assessments should be made early. Once commercial activity has started, the business may already have filing deadlines, documentation requirements and tax reporting obligations.

Next steps

We regularly assist foreign companies, investors and individuals with establishing and operating businesses in Norway, including NUF and AS registration, bookkeeping, VAT, tax, payroll, reporting, annual accounts and communication with Norwegian authorities.

Please contact us for an informal discussion about your Norwegian establishment and ongoing compliance obligations.

Kim Fosshaug
Partner

Truls Bache
Lawyer

Last updated: 29 June 2026

Hearing proposal on changes to the exit tax rules

Hearing proposal on changes to the exit tax rules


The current Norwegian government lead, by Jonas Gahr Støre, has once again worked the night shift, and presented a hearing proposal on March 20 to tighten the rules for exit tax. The changes are proposed to take effect from today, Thursday, March 20, 2024.

The proposal involves relatively significant changes. Among other things, it will mean that the possibility of indefinitely postponed payment of calculated exit tax will be terminated, in addition to the introduction of exit tax on share savings accounts and capital insurance, as well as tax at death abroad.

This proposal is intended as part of the measures to stop the migration of wealthy individuals and capital, but it may well achieve the opposite; people will move out earlier than they otherwise would have. We must wait and see what the final result will be, both in terms of the final legal text and the effect the new rules will have on emigration.

Click here to read the government’s consultation document.

Contact

Kim Fosshaug
Partner

Antonio Holstad
Partner

Torbjørn Stokke
Partner

Corporate taxation expert from PwC becomes partner at Brækhus

Corporate taxation expert from PwC becomes partner at Brækhus

We are delighted to welcome Kim Fosshaug as a partner at Brækhus from March 1st. Fosshaug joins Brækhus from the position as a Lawyer/Director at PwC.

Kim Fosshaug is an expert in national and international corporate taxation, with specialised knowledge in international taxation and in the financial sector. He assists national and international investment companies, financing institutions, and other financial sector entities with matters related to international taxation, regulatory issues, and EU/EEA law. He also offers advice on national and international tax and corporate law, including restructuring and reorganisations, and appeals. 

– I am excited to be part of Brækhus and their renowned Tax and VAT team. Brækhus’s strong international profile and focus has been an important factor in my choice of Brækhus, says Fosshaug. 

Partner Kim Fosshaug og Partner/Head of Tax and VAT, Nils Eriksen.

Brækhus’s Tax and VAT team is among the country’s leading tax law environments, which, unlike the “big four”, is audit-independent. The team provides advice at all stages of tax law and has extensive experience in national and international tax law, VAT, customs and excise duties, and cross-border taxation of individuals. 

Brækhus assists Norwegian and international companies with establishment in Norway and abroad, and employees across borders through our well-known global mobility offering. For many of our international clients, Brækhus acts as a One-Stop-Shop – a single contact point for tax advice and all legal services. 

– Tax is a strategically important area for Brækhus. We are very pleased to have signed Kim. With Kim on board, our already strong tax and VAT team is further strengthened,” says Nils Eriksen, Partner and Head of the Tax and VAT department. 

Kontakt

Kim Fosshaug
Partner

Nils Eriksen
Partner