The Norwegian taxation system
In Norway, we pay tax in many different ways, both directly and indirectly.
Income and net wealth tax are the direct taxes. Income tax is paid on the money you earn from work, business activities, interest on bank deposits, etc.
How much tax you pay depends on how much you earn. If you earn below a certain amount during the year (the tax-free amount), you pay no tax.
Money you earn from a full-time or part-time job is taxable. How much tax you pay depends on how much you earn. If you earn below a certain amount during the year (the tax-free amount), you pay no tax.
If you have wealth, you also have to pay net wealth tax.
Value-added tax (VAT) is an indirect tax. This tax is levied when we buy goods and services.
You may have noticed that when you buy goods, the receipt shows that 25 percent of the sales price is value-added tax (“inkl mva”). This means that the shop pays part of what you pay for your merchandise to the state.
It is fraudulent for the shop not to pass the VAT on to the state. By asking the shop to enter the amount you pay in the cash register and getting a receipt, you can help ensure that the businesses you deal with keep their commitments to the state.
Why do we pay tax?
We want everyone to have the opportunity to get an education, and to receive treatment in a hospital if they become ill.
As residents in Norway, we enjoy and benefit from many welfare initiatives. They cost money - a lot of money. And that’s why it’s important that everyone contributes and pays their share.
We achieve this by paying tax.
We can view our society as a large, collective money box, a shared source of funding. Everyone pays tax according to their ability and receives the benefits they need.
Tax deduction card
When you have a job, you'll need a tax deduction card. If you earn below a certain amount through the year (the tax-free amount), you can order an exemption card. In that case, you'll pay no taxes. If you earn above the tax-free amount, you must have an ordinary tax deduction card. If you have a national identity number, you can order a tax exemption card or an ordinary tax deduction card.
No Norwegian national identity number?
If you do not have a Norwegian national identity number, the general rule is that you must report to one of the tax offices that performs ID checks. You must provide a valid passport or another type of ID before you can get a tax deduction card.
Your employer retrieves your tax deduction card directly from the Tax Administration. You'll be sent information about your tax deduction card (your tax deduction notice) to the address registered for you in the National Population Register. You do not need to send anything to your employer. Your employer deducts tax from your salary and pays the deducted tax on your behalf.
Make sure that you receive payslips from your employer every time you receive your salary. A payslip is your receipt that your employer has deducted tax from your salary.
The tax office calculates how much tax you need to pay. They cannot do this until they know how much you've earned. The tax office receives a notice from your employer confirming how much you've earned in the past year. The tax office then sends you a pre-filled tax return and asks you to confirm that the information regarding income, allowances, deductions and so forth is correct. If the information is wrong, you must make the necessary corrections.
Tax assessment notice
Once the tax office has processed your tax return, you'll receive a tax assessment notice. If you've paid too much tax, you'll receive a refund paid to the bank account number stated in your tax return. If you've paid too little tax, you will have to pay the underpaid tax. If the underpaid tax is over NOK 1,000, the claim will be divided into two instalments.