Legal Basis for VAT in Norway

Although Norway is closely integrated into the European internal market (through its membership in the European Economic Area, EEA), it is not part of the EU. This results in differences, particularly with respect to VAT. While Norway has adopted many elements of EU VAT law, the system as a whole is independent.

Legal Regulations for VAT in Norway:

• Norwegian VAT Act and related regulations
• Norwegian Accounting Act and related regulations
• Norwegian VAT Handbook

 

 

VAT Registration in Norway

Foreign companies operating in Norway must check if they are required to register for VAT. This obligation generally arises when goods or services are sold in Norway, and the turnover exceeds 50,000 NOK (within 12 months). The registration is done in two steps in the company register and the VAT register.

First Step: The foreign company must be registered in the Norwegian company register as a "NUF" (Norwegian Branch of a Foreign Company). The Norwegian internet portal Altinn provides information here on its website.

Second Step: The company can then register in the Norwegian VAT register. Altinn also provides information about this on its website.

The Norwegian tax authorities provide guidance on VAT registration and filing VAT returns.

 

Sales of Goods in Norway

Norway generally taxes all supplies of goods and services occurring within the country. The standard VAT rate is 25%, though reduced rates apply to certain goods. Information on these reduced rates is available from the Norwegian tax authorities.

The place of supply, which determines VAT liability, is primarily determined by the contract of sale. Unlike EU law, which has specific provisions for certain situations, Norwegian law takes a more general approach. Typically, the place of supply in Norway is where the goods are delivered according to the contractual terms.

The specific circumstances must also be evaluated from an economic perspective. For instance, the "Ifi Oy" ruling is important to mention in this context. It states that the place of supply should not only be determined by the terms of the sale contract but by a comprehensive consideration of all relevant factors. This may result in a delivery being considered as taking place in Norway even if the goods are delivered abroad according to the applicable Incoterms, especially for foreign companies that are actively operating in the Norwegian market. Key factors include the company's focus on the Norwegian market, such as a Norwegian website or business processes tailored for Norwegian customers.

Plant projects (supply and installation of equipment) are generally considered "Supply & Install" projects under Norwegian law. These projects are characterized by the gradual or complete transfer of ownership of the supplied plant upon completion. Under Norwegian law, such projects are typically subject to VAT in Norway, regardless of the contractual delivery location. It is therefore advisable for companies to adapt their VAT processes accordingly.

 

Provision of Services in Norway

While EU VAT law often provides specific rules for determining the place of supply of services, Norwegian law follows a more general principle: services rendered in Norway are subject to Norwegian VAT. This applies regardless of the specific type of service, including the rental of goods. Exceptions to this principle may apply, especially for so-called "remotely deliverable" services.

The standard VAT rate is 25%, but reduced rates may apply for certain services. Information on these reduced rates is available from the Norwegian tax authorities.

 

 

Application of Reverse Charge in Norway for "Electronically Supplied" Services

Norway has a special rule for certain services, known as "remotely deliverable" services. If a company in Norway acquires such a service from a foreign company, it is usually required to calculate and pay the Norwegian VAT itself. This means the VAT liability shifts to the recipient in Norway.

Examples of electronically supplied services include consultancy, IT services, and marketing services. The key factor is that these services can theoretically be provided remotely. The Norwegian tax authorities provide detailed information in the VAT handbook about which services qualify as electronically supplied.

Furthermore, the Norwegian tax authorities have created a guide to help determine whether reverse charge applies.

 

Exemptions and Exclusions in Norwegian VAT Law

Not all transactions are subject to VAT in Norway. Some transactions are either fully exempt or excluded:

• Exempt transactions (Exemption from VAT): VAT is not levied on these transactions, but there is a right to deduct input tax. Examples include certain printed materials and exports of goods and services.
• Excluded transactions (Exception from VAT): These include transactions in healthcare, education, and real estate sales. VAT is not charged on these transactions, and there is no right to deduct input tax.

The Norwegian tax authorities provide information on the differences between "Exemptions" and "Exceptions."

 

Input Tax Deduction in Norway

Companies in Norway generally have the right to deduct the VAT they paid on purchases (input tax) from the VAT they owe on sales (output tax). To qualify for this, companies must be registered for VAT and must use the purchased goods or services for their business activities.

However, there are restrictions: for example, there is generally no right to deduct VAT on the purchase and maintenance of cars or on catering and entertainment expenses.

A correct invoice is crucial for claiming input tax: this area is strictly regulated.

 

Format of a Norwegian Sales Invoice

The proper format of a Norwegian sales invoice is of utmost importance. The legal foundations for this can be found in the Norwegian VAT Act and Accounting Act. The invoice must include several mandatory details:

• Information about the issuer: company name as registered in the Norwegian company register, address, and organization number (with the "MVA" suffix if the company is registered for VAT)
• If applicable, information about a VAT representative
• Information about the recipient: it is advisable to include the Norwegian organization number of the recipient
• Invoice number: a unique Norwegian invoice number system must be used without gaps
• If applicable, VAT amount: if the invoice is in EUR, the VAT amount must also be shown in NOK
• Language used: Norwegian or English
• Quantity and description of goods delivered
• If applicable, a note about the VAT liability of the recipient
• Invoice issue date
• Date or period of delivery or service
• Place of delivery or service
• If applicable, the amount broken down by VAT rates and exemptions
• Amount and corresponding tax amount, as well as any exemptions
• Payment terms

For more information on sales invoices, the Norwegian authority Altinn provides guidance on their website.

 

Accounting Obligations in Norway

Registration in the Norwegian VAT register and the submission of regular VAT returns entail extensive accounting obligations. In practice, attention should be given to the fact that, in the case of a VAT audit, the Norwegian tax authorities often request a so-called SAF-T file: the Norwegian tax authorities provide information on this on their website.

 

Export of Goods to Norway

Our website "Export to Norway" provides more detailed information on customs, import VAT, and special taxes (called "Særavgifter").

 

VAT Refund Procedure in Norway

This procedure applies to foreign companies that are not required to register for VAT in Norway (e.g., because they do not make taxable sales in Norway) but have paid Norwegian VAT or import VAT. These companies should check if they are eligible for a VAT refund. The Norwegian tax authorities provide information on the refund procedure on their website. However, it is important to note that the Norwegian tax authorities will first check if taxable transactions have occurred in such cases.

 

Practical Guide to VAT in Norway

In our article "VAT Guide (B2B) Norway" in the RIW journal, issue 6/2024, pages 327-345, we provide practical insights on the following topics:

• VAT principles and definitions in Norway
• VAT registration obligation in the Norwegian VAT register
• Place of supply according to Norwegian VAT law
• Place of other services according to Norwegian VAT law
• Import of goods to Norway
• Norwegian import VAT
• Exemptions and exclusions in Norwegian VAT law
• Application of reverse charge in Norway – e.g., "Electronically Supplied Services"
• Input tax deduction in Norway
• Format of a Norwegian sales invoice
• Norwegian VAT returns
• Accounting obligations in Norway
• Explanation of Norwegian accounting and SAF-T files
• Practical examples

For the PDF version of the article (in German): VAT Guide (B2B) Norway

 

 

ybiN AS - Tax Advisors in Norway - Excerpt from Our Service Catalog:

• Registration with the Norwegian VAT register
• Fiscal / VAT representation in Norway
• Running VAT accounting in Norway
• Filing Norwegian VAT returns
• Submission of other reports (e.g., special taxes, flight passenger tax)
• Assistance with VAT or customs inspection in Norway
• Evaluation of specific VAT problems,  analysis of individual cases
• Advice on customs in Norway
• We can help you to find a customs partner / freight forwarder in Norway
• Assistance with the simplified form of registration via the VOEC platform
• Preparation of Norwegian sales invoices