Residence under the tax treaty

If you stay abroad but do not meet the requirements for cessation of your tax liability to Norway under the rules referred to above, you will still be tax resident in Norway under Norwegian internal law. If you are tax resident in both Norway under Norwegian internal law and in the country where you are staying under that country's internal law, the issue of residence must be determined in accordance with the provisions of the tax treaty between Norway and the other country. The same applies if you become tax resident in Norway and are still tax resident in the country from which you have moved.

Where are you resident under the tax treaty and what consequences does it have?

When you are tax resident in both countries, your residence status must be determined in accordance with the provisions of the tax treaty's article concerning tax residence (normally Article 4). Under this provision, you shall be deemed to be resident in the country in which you have a permanent home available to you. If you have a permanent home available to you in both countries, the decisive factor is with which country your "personal and economic relations are closer (centre of vital interests)”. If this does not provide a clear answer or you do not have a permanent home available in either of the countries, you will be deemed resident for the purposes of the tax treaty in the country in which you have an habitual abode. If you have an habitual abode in both countries, you will be deemed to be resident in the country of which you are a citizen. 

Residence under the tax treaty will be of significance in determining which income can be taxed in Norway.

If you are tax resident in Norway under Norwegian internal law but resident in another country under the tax treaty, you will generally be liable to tax in Norway only on salary income earned in Norway, real property or business income in Norway and share dividends from Norwegian companies. You may also be liable to tax on pensions and disability benefits from Norway and on capital.

If you are resident in Norway under both internal law and the tax treaty, you will in pricipal be liable to tax in Norway on all your capital and income. The tax treaty contains rules concerning the avoidance of double taxation and it may also limit your obligation to pay tax to Norway.

Documentation of residence abroad

If you claim to be resident in another country under Article 4 of the tax treaty, you must document this to the tax office in Norway. You must submit a Certificate of Residence from the tax authorities in the other country which expressly states that the tax authorities concerned consider you to be resident there under the tax treaty. The Certificate of Residence must be an original document and it must refer to the tax treaty with Norway and state the period it applies to. The tax office may require you to present a new Certificate of Residence for each income year.

Even if you submit a Certificate of Residence which states that the other country's tax authorities consider you to be tax resident there,  the Norwegian tax office shall carry out an independent assessment of where you should be deemed resident under the tax treaty. The criteria for this assessment are set out in the tax treaty's article 4 (2).

If you live in another country and believe that your connection to that country is such that you are resident there under the tax treaty, you should bring this matter up with the tax office in Norway. You will then need to present a Certificate of Residence and provide the information concerning your connection to the other country and to Norway that is necessary in order for the tax office to assess the question of residence. The same applies if you are actually taxed on the same income in both the other country and in Norway.

If a double taxation situation is not resolved in this way, you must bring the matter up with the tax authorities in the country in which you claim to be resident. If you claim to be resident in a country other than Norway, you must bring the matter up with either the Ministry of Finance in that country or with the tax authority which has been authorised to deal with such double taxation cases. If the authority dealing with the case concludes that you have been taxed on the same income in two countries, they will bring the matter up with the Directorate of Taxes or the Ministry of Finance in Norway if they are unable to eliminate the double taxation themselves. If you are resident in Norway, you can bring the matter up with the Directorate of Taxes.

If you are tax resident in Norway under Norwegian internal rules but resident in another country under a tax treaty, you will always be obliged to submit a fully completed tax return to the Norwegian tax authorities.

The rules concerning tax residence in Norway in connection with moving to or from Norway are set out in Section 2-1 second to sixth paragraphs of the Taxation Act.