You must do the following:
You must declare the income in your tax return
Even if you have paid tax on the income abroad, you must also declare the income in Norway.
- Tick "Yes" under item 1.5.6 for income abroad in the tax return
- Fill in item 2.8.5 in the tax return. Under the item, enter 85% of the rental income which exceeds NOK 10,000.
You must ensure that this is declared in your tax return every year in which you receive rental income from the holiday home.
Remember that you must also declare the property in the tax return. How you should declare it will depend on whether you have purchased, inherited/taken over or sold the property.
You will not pay double tax
You will not pay double tax even if you declare the income in Norway.
Norway has treaties with certain countries which determine where income will be taxed. If the property is situated in one of the countries in this list, the income will not be taxed in Norway. If the country in which your holiday home is situated is not shown in the list, you can claim a deduction from your Norwegian tax for the tax you have paid abroad.
If you believe you are entitled to a deduction in Norway, you must:
- Tick "Yes" under item 1.5.6 for credit deduction in the tax return.
- Submit form RF-1147E Deduction for tax paid abroad by a person – credit deduction together with your tax return.
- Document tax paid abroad. The documentation must originate from the tax authorities concerned, and show:
- The income year that the tax concerns
- That the tax has been assessed with final effect, not just calculated provisionally
- That the tax has actually been paid
- That it is income tax (and not, for example, tax on wealth) that you have paid
The Norwegian Tax Administration may require documentation in a non-Nordic language to be translated into Norwegian or English by an officially authorised translator.
The documentation must be attached to the tax return.
Amend tax deduction card?
If you have not previously updated your tax deduction card with the rental income, you should consider amending your tax deduction card.