Tax limitation due to inability to pay tax

  • Print

If you have very low income over a period of time, you may, after strict means-testing, be entitled to tax limitation due to your inability to pay tax. This can apply to single people, married couples and cohabitants. Your income must be so low that “it cannot be considered sufficient to provide for a necessary, moderate standard of subsistence” for yourself and people you are obliged to provide for. Consideration will be given to your wealth and income, as well as that of your spouse or cohabiting partner and others in your household.

Families and single people with a normal income will not be entitled to tax limitation. Old-age pensioners will automatically receive a tax deduction for their pension income.

To be entitled to tax limitation, your general income must be low. ‘General income’ means income after tax deductions. You will find it under item 3.6 of your tax return. The calculation is based on general income before the deduction of any special allowance, with the addition of any tax-free income such as child benefit, cash support and maintenance. Consideration will be given to inheritance, gifts, gains and other types of occasional income. Social security benefits, repaid tax and underpaid tax are not taken into account in the assessment.

Threshold amount (2016 income year)

  • For married couples and spouse-equivalent partners - NOK 256,300
  • For single people – NOK 139,400

If you have corrected your general income to an amount below or equal to the threshold amount, zero tax and National Insurance contributions will be payable.

The maximum tax rate payable on the amount that exceeds the threshold amount is 55 percent.

No tax limitation will normally be granted if you are entitled to a study loan, if your income and wealth is determined through a discretionary assessment or if you have a temporary reduction in income or low income due to part-time work.

How to apply for tax limitation

Tax limitation is not granted automatically. You must enter additional information concerning this under item 5.0 Additional information of the tax return yourself. You will not normally have to provide information on rent, electricity, insurance and other fixed expenses.

You can find out more about the conditions and the calculation linked to inability to pay tax here.

Did you find what you were looking for?

Maks 255 tegn. Kun tall og bokstaver.