Unlimited tax liability

The significance of being resident in Norway for tax purposes

If you are resident in Norway for tax purposes, you will be liable to pay tax to Norway on all assets and income, whether located or earned in Norway or abroad. Tax agreements with other countries may limit your taxes to Norway.

New rules apply from 2004 for tax residence for persons moving to or from Norway. These rules differ a great deal from those that applied earlier.

Residence for tax purposes when moving to Norway

The rules for residence for tax purposes when moving to Norway, apply to:

Persons who have not previously lived in Norway, and
Persons who have previously lived in Norway and who were registered as no longer resident in Norway for tax purposes before 1 January 2004.

Persons staying for one or several periods in Norway for more than 183 days during a 12-month period will be considered as tax resident in Norway. The same applies to persons staying in Norway for one or several periods for more than 270 days in the course of a 36-month period. Every whole or part of a calendar day of stay in Norway is included when calculating the number of days.

If you stay in Norway for more than 183 days during the year you moved to Norway, you are resident for tax purposes from the first day of your stay in Norway. If the 183 days are divided between two income years, you will become a tax resident from 1 January in the second year. (You will have limited tax liability the preceding year. This means that you are only liable to pay tax on certain income linked to Norway.)

If you stay in Norway for more than 270 days in the course of a 36-month period, you will be resident for tax purposes from 1 January in the year when your stay exceeds 270 days. (You will have limited tax liability the preceding year/s.)

You may stay an average of 90 days per year in Norway without becoming resident for tax purposes in Norway.

When does tax residence cease when moving from Norway?

Only persons who take up habitual residence abroad are considered as having moved from Norway for tax purposes. A temporary stay abroad does not terminate your tax residence in Norway.

The rules for tax residence when moving from Norway apply to:

Persons who were resident in Norway as per 31 December 2003, and
Person who became resident for tax purposes in Norway in 2004 or later.

For tax residence in Norway to cease when you move abroad, you must document

That you have taken up habitual residence abroad,
That you have not stayed in Norway for one or more periods exceeding 61 days in the income year, and
That you or a closely related person (spouse, cohabitant, children under age) do not have a house/flat available in Norway.

If your have lived for less than 10 years in Norway before the income year in which you take up habitual residence abroad, your tax residence in Norway will cease during the income year when all of the three above requirements are met.

If you have lived in Norway for a total of 10 years or more before the income year in which you take up habitual residence abroad, your tax residence in Norway will only cease after the end of the third income year after the year when you took up habitual residence abroad. For each of the three years, the following requirements must be met:

Your stay in Norway must not exceed 61 days
You or a closely related person (spouse, cohabitant, children) must not have a house/flat available in Norway.

The requirement that you must not have a house/flat at your disposal means that neither you, nor your spouse/cohabitant or your under-aged children can own (directly or indirectly), lease or otherwise be entitled to use a house/flat in Norway. Children under age living with your former spouse or cohabitant in Norway are not normally considered as having a house/flat at their disposal in Norway.

You much submit a tax return for each of these three years, stating whether you meet the requirements for termination of tax liability.