Tax deduction card information for employers
As an employer, you must retrieve your employees' tax deduction cards.
Please remember the following:
- You must retrieve your employees' tax deduction cards electronically.
- You do not need to receive or retain the tax deduction cards on paper.
- You’ll be notified when an employee amends their tax deduction card, and you’ll have access to their most recent tax deduction card at all times.
How electronic tax deduction cards work
Prior to each income year, the Norwegian Tax Administration will issue a new tax deduction card to everyone who’s expected to receive taxable income during the income year concerned. Tax deduction cards are valid for one year at a time. Employees can amend their tax deduction card at any time, for example if they’ve purchased property, taken out a loan or if their interest expenses have changed. You’ll be notified by the Norwegian Tax Administration if one of your employees amends their tax deduction card during the year. You must then retrieve the new card before the payroll run.
Tax deduction cards are valid for the whole income year or for the remainder of the income year if a new card is issued during the income year.
There are four types of tax deductions, but as an employer, you’ll probably only use three of these:
- table-based deductions
- percentage deductions
- exemption cards with tax-free amounts
Table-based deductions specify the table you as the employer should use to make deductions. They also specify the percentage rate for withholding tax regarding benefits from which deductions cannot be made according to a table (known as ‘percentage deductions’). Employees must ensure that only one employer uses the table-based deduction method during a particular period.
Percentage deductions specify the percentage rate that should be used as a basis for deductions.
Exemption card with tax-free amount (exemption card)
An exemption card with a tax-free amount (exemption card) gives exemption from payroll withholding tax deductions up to NOK 55,000 during the income year (2020). These cards are often used by young people and students who have a summer job or a part-time job.
If you’re the only employer of an employee with an exemption card, the full amount will be allocated to you. If the employee has several employers who’ll use the exemption card, the employee must allocate the amount between the various employers. The employee will decide how much of the exemption card you can use.
If the employee’s salary exceeds the tax-free amount, you must deduct 50 percent tax of the surplus amount.
If the tax-free amount is NOK 0, you have not been allocated part of the amount as an employer. You must then deduct 50 percent tax of the entire salary payment.
When the employee has allocated the tax-free amount, you must retrieve the tax deduction card again. You’ll be notified by the Norwegian Tax Administration if one of your employees amends their exemption card.
Tax Payment Act
Amendments to the Tax Payment Act concerning electronic tax deduction cards were adopted in the revised National Budget for 2012, with effect from the 2014 income year. Amendments were made to the Tax Payment Regulations through the Regulation of 27 September 2013 No. 1149.
Legal basis: section 5-1 of the Tax Payment Act and section 5-1 of the Tax Payment Regulation.