The new bracket tax for personal taxpayers is calculated based on the individual's salary income and other corresponding incomes which replace salary income, such as sick pay, work assessment allowance, disability benefit and pension.
Bracket tax consists of four steps. You will not pay any bracket tax on the first NOK 159,800 of your personal income.
||Income between NOK 159,800 – 224,900
||0.44% bracket tax
||Income between NOK 224,900 – 565,400
||1.7% bracket tax
||Income between NOK 565,400 – 909,500
||10.7% bracket tax*
||Income over NOK 909,500
||13.7% bracket tax
*residents of Finnmark and Nord-Troms 8.7%
About the steps
Bracket tax uses rising tax rates, split between four steps, where the bottom two steps are triggered at lower income levels than was the case with surtax. The first stage concerns income in the lowest income band, while the other stages concern income above this. The activation thresholds in steps 3 and 4 correspond to the surtax activation thresholds for 2015 adjusted to 2016 salary levels. The rates and income levels are the same regardless of whether you are assessed under tax class 1 or whether you are assessed jointly with a spouse under tax class 2.
The new bracket tax is linked to the reduction in tax on general income from 27% to 25% with effect from the 2016 income year. General income comprises all types of taxable income with the deduction of all deductible expenses.
The special reduction in the surtax rate which residents of Finnmark and Nord-Troms previously received has been continued through the setting of the tax rate for step 3 to 8.7% for residents of this region.
For the 2015 income year, you will pay surtax on salary and other personal income above NOK 550,550 per year. This means that the rules for bracket tax do not apply to 2015 and will only apply from the start of the 2016 income year, when surtax will also be abolished.