The basic rule is that all Norwegian companies and foreign enterprises conducting business activities in Norway are subject to Norwegian corporate tax.In this article we'll provide you the basics.
* Also applicable on Norwegian branch of a foreign enterprise.
** The dividend withholding tax rate is zero on distributions to corporate shareholders genuinely established within the EU/EEA. The rate is also normally reduced according to a tax treaty.
*** A 15% withholding tax on interest, royalties, and certain lease payments to related entities resident in a low-tax jurisdiction was introduced in 2021.
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According to domestic tax law the threshold for becoming subject to corporate tax in Norway is rather low. The starting point is that any foreign enterprise will become subject to Norwegian corporate tax if it conducts business activities within Norway or if it hires out employees to work in Norway.
However, Norway has tax treaties with about 90 countries, which may provide exemption from Norwegian tax liability. An assessment of tax liability must therefore be made specifically for each foreign enterprise and based on the relevant tax treaty.
The basic rule in the tax treaty is that a foreign enterprise becomes subject to tax if it has a so called “permanent establishment” or “PE” in Norway.
A PE may exist e.g. if the foreign enterprise:
Norwegian tax authorities are aware that multinationals may be tempted to reduce the taxable profit in Norway when determining the transfer prices between group companies. To adjust transfer prices has become a targeted area for tax auditors. It is therefore essential that intra group prices can be documented as arm’s length.
Certain intra group transaction must be reported when filing the corporate tax return, and in some cases, the enterprise should annually prepare transfer pricing documentation.
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According to provisions of the Tax Act the tax office may disregard transactions or structures if the dominant motive is to save taxes and the tax effects of entering into the transaction or structure are regarded as disloyal to the tax system.
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The Norwegian Country-by-Country Reporting (CbCR) rules imply that Norwegian entities that are part of a multinational group of companies with consolidated turnover exceeding NOK 6.5 billion in the financial year, must notify the tax office when filing the tax return.
A foreign company that is subject to corporate tax according to domestic Norwegian tax law, is obliged to file the corporate tax return. This obligation exists even though the enterprise may be exempted from corporate tax liability pursuant to a tax treaty, unless the tax administration has accepted an application for non-filing the relevant year.
The deadline for filing the corporate tax return is end of May in the year after the end of the income year.
A corporate tax return must be filed electronically via www.altinn.no, and only by using an approved software. Paper filing is not accepted.
More information: Taxes in Norway - employee taxation
A foreign enterprise doing business in Norway may have several compliance obligations, including registration in various public registers and reporting to various public authorities. E.g. payroll reporting is due monthly and VAT-reporting is due every second month.
The failure to comply will normally result in heavy fines. If you need help with your corporate tax in Norway and other Norwegian compliance related questions, we are happy to assist you.
Article first published November 2018, updated December 2023.