Brief information about the tax and contribution rule

Svalbard is a separate taxation area. All those who receive salary or other benefits for work or pensions on Svalbard must pay tax to Svalbard under the PAYE scheme for Svalbard.

The PAYE scheme for Svalbard principally covers:

• salary and other remuneration for work and assignments either within or outside a contractual employment relationship, including fees, commission, etc.
• board fees and similar
• benefits in kind and profits made on expense allowances
• severance payments
• pension, disability benefit, benefits from surrendered property or annuities as part of a pension scheme in employment when the recipient is resident for tax purposes on Svalbard (period of residence lasting more than 12 months).

You must apply the Svalbard tax and contribution rule for income recipients who:

• are resident on Svalbard and receive salary and other benefits for work or pensions
• are not resident, but who have a continuous residence period in excess of 30 days and who receive salary or other benefits for work

Deductions must be made in all salary payments - this includes holiday pay on salary, salary during the holiday and salary in December. In addition to benefits you must also specify withholding tax and the deduction with Svalbard. You must give information on the income recipient's period of residence on Svalbard. Also, employer’s national insurance contributions must be specified with a calculation code for Svalbard.

 

Benefits from the public sector

Tax and national insurance contributions must be deducted in accordance with the rules for salary deductions from sickness benefit, maternity benefit and adoption benefit, as well as unemployment benefit that is paid to an income recipient who is resident on Svalbard. This also applies when the recipient of benefits is resident on the mainland. It is a condition that the residence on Svalbard must last for a continuous period of at least 30 days, and that the person was actively working on Svalbard at the time the right to receive payment arose.

 

Salary for work on the mainland or abroad

Persons who are tax residents on Svalbard are not liable to pay tax to Svalbard on salary for work performed on the mainland or abroad. This applies for example to work while on holiday or during leave or military service, provided that the salary is taxed on the Norwegian mainland or in another state.

Read more about the tax rules for Svalbard in the Tax-ABC (norwegian only)

Read more about the PAYE scheme for Svalbard

 

Continuous residence period in excess of 30 days

If a person who isn't resident on Svalbard stays on Svalbard for more than 30 days without leaving the island, we consider this to be a continuous period of residence. This also applies to periods of residence that extend over a year-end.

How to calculate the period of residence:

• count the number of consecutive days
• doesn't include travel days to and from
• leaving Svalbard will end the continuous period of residence and the count will restart

If a person works on Svalbard for 14 days, spends a weekend on the mainland, and then works another 20 days on Svalbard, this is considered to be two periods of residence of less than 30 days. You must therefore not apply the tax and contribution rule for these periods.

 

 

The information you must provide

You must specify information about the employees residence period on Svalbard at least once per stay. As long as the employee stays on Svalbard you can repeat the information about the residence period each time you send an a-melding. You must, in addition to other obligatory information, specify:

Residence ID	unique ID
Start date	from date
End date	to date
Residence description	Svalbard

The start date and end date are for the continuous residence period.

 

Benefits that the tax and contribution rule covers

You can apply the tax and contribution rule to most types of salary and other benefits.

When the income recipient fulfils the conditions, you must specify the benefit with the “Svalbard” tax and contribution rule.

See summary of benefits that the tax and contribution rule covers

 

What about withholding tax

If you have applied the tax and contribution rule on salary and other benefits, you must also specify withholding tax as “Svalbard”. This applies to the salary deduction that has been made from salary, other benefits and pension earned on Svalbard.

Here you find the rates for deducted tax and national insurance contributions to Svalbard. The annual statement concerning tax and tax deductions on Svalbard, Jan Mayen and the dependencies provides more details concerning how the deductions will be made.

 

What about the deduction description

If you have used the tax and contribution rule on salary and other benefits and the employee is covered by the PAYE scheme for Svalbard, you must also remember to specify the following deduction descriptions for Svalbard:

• Trade union fees Svalbard
• Premium for pension scheme, Svalbard
• National Insurance premiums and education and development fund premiums – Svalbard
• Portacabin rent – Svalbard

 

What about employer’s national insurance contributions

See separate description of employer’s national insurance contributions for salary deductions on Svalbard under the point other industries.

 

Correcting errors

 

What we use the information for

NAV uses information concerning salary and other benefits to calculate unemployment benefit and to check benefits such as sickness benefit, parental benefit, disability benefit and advance child maintenance payments.

The Norwegian Tax Administration uses the information to ensure that income recipients on Svalbard are taxed in accordance with the PAYE scheme for Svalbard.

Statistics Norway (SSB) uses the information for statistical purposes.