Tax on latent gains on shares etc. on moving from Norway (exit tax)

If you meet the requirements for cessation of tax residence pursuant to domestic law or a tax treaty you are liable to tax on the increase in value of shares etc. up until the date you move from Norway. The amount liable to tax is the gain that would have been liable to tax if the shares etc. had been realised on the day before the cessation of full tax liability.

These rules also apply if you transfer shares etc. to your spouse who is tax resident abroad.

The tax liability applies to gains relating to:

  • shares and equity certificates in Norwegian and foreign companies
  • units in Norwegian and foreign unit trusts
  • holdings in Norwegian and foreign partnerships etc.
  • subscription rights, options and other financial instruments relating to shares etc., including options from your employer

There is no requirement relating to the size of the ownership interest in the company or the period of ownership.

When the total net gain (after any deductible loss) does not exceed NOK 500,000, the latent gain is not liable to tax. If the total net gain exceeds NOK 500,000, the entire gain is liable to tax.

Latent losses are only deductible when moving to another EU/EEA country and only to the extent a deduction is not granted in the other country. The taxpayer is only entitled to a deduction if the net loss exceeds NOK 500,000.

The tax liability applies irrespective of how long you have been tax resident in Norway.

The latent gain that is liable to tax is calculated and assessed in connection with the tax assessment for the year when you moved (the day before the cessation of full tax liability). Any latent deductible loss will also be calculated in connection with the assessment for the year you moved, but it will not be settled until such time as the shares etc. are realised.

Statement concerning shares etc.

When you claim in your tax return that tax liability to Norway as a resident has ceased pursuant to domestic law or a tax treaty, you must submit a statement covering all shares etc. included in the tax liability, and a calculation of the gain. This applies irrespective of how many shares etc. you own. The statement must be given in the form RF-1141 “Gevinst og tap på aksjer og og andeler ved utflytting” (Gains and losses on shares and holdings on moving from Norway – in Norwegian only) and submitted together with the tax return.

The opening value of the shares etc. is determined in accordance with the ordinary rules. If you have lived in Norway for less than ten years you can demand that the market value on the date when you became tax resident in Norway be used as the opening value for the shares etc. The opening value may not, however, be set higher than the closing value.

The closing value shall be set at market value on the day the shares etc. are deemed to be realised, i.e. the day before the cessation of full tax liability. For listed shares, the average turnover value on the realisation date shall be used. For unlisted shares and holdings without a known market value, the value must be stipulated through the exercise of discretionary judgement.

Deferment of payment of the tax

You may be granted a deferment for payment of the tax on the latent gain until you actually realise the shares etc., provided you furnished adequate security for the tax. You may be granted a deferment without security having to be furnished when you move to an EU/EEA country and Norway has a treaty with a provision that the country you move to will exchange information on your income and assest and assist in the recovery of tax claims. You may also be granted a deferment for payment of the tax without security having to be furnished when you move to Svalbard. You must demand a deferment for payment in the form RF-1141.

Realisation after you have moved

If you are covered by the provision on exit tax and you realise shares etc. within 5 years after your tax liability has ceased pursuant to domestic law or a tax treaty, you must submit the form RF-1314 "Realisasjon av aksjer og andeler etter opphør av skattemessig bosted i Norge" (Realisation of shares after the cessation of tax residence in Norway – in Norwegian only) within two months after the sale took place.

Changes to the calculated latent gain

The calculated latent gain that is liable to tax in Norway can be reduced when you realise the shares etc. at a value lower than the closing value stipulated in connection with the move. You can submit information in the form RF-1314.

The calculated tax lapses if:

  • you have not realised the shares etc. five years after your tax liablility has ceased pursuant to domestic law or a tax treaty
  • you move back to Norway and become tax resident here pursuant to domestic law before you sell the shares etc.
  • you become resident for tax purposes in Norway pursuant to a tax treaty before you sell the shares etc.

The tax office can provide further information.