Bitcoin and other virtual assets

Taxable business activity 

Any benefit gained through work, capital or business activity is considered taxable income. A benefit gained through business activity is considered to be a benefit gained from the sale of goods and services. The general rules of the Taxation Act apply to virtual assets, including cryptocurrency and NFTs, and there are no special rules. 

For tax purposes, cryptocurrency is not equated with an ordinary currency since it’s not issued or guaranteed by a national central bank. Cryptocurrency is an asset and is subject to the ordinary rules for income and wealth tax. 

Bitcoin is defined as an asset, and an activity of buying and selling bitcoin can be considered a business activity. Furthermore, mining bitcoin (verification of bitcoin transactions) can be considered a business if this activity is of a certain scope. 

In order for an activity to be considered a business, four conditions must be met. The activity must: 

1. be designed to have a certain duration
2. have a certain scope
3. be likely to generate a profit, and
4. be carried out at the taxpayer's expense and risk

All four conditions must be met before the activity is considered a business activity. The conditions are described in detail in the guide Skatte-ABC, under the topic "Virksomhet – allment” (in Norwegian only). 

Trade with virtual assets (trading) 

Normal occasional trading in virtual assets will not be considered a business activity. If trading occurs routinely and a significant number of transactions are completed, the trading could be considered a business activity. 

If you carry out transactions on behalf of another and are paid for this (brokering) and any other support services (reporting, calculation of gains/losses, etc.), the business activity requirement is fulfilled faster than if you only carried out trading for your own account and risk. 

Cryptocurrency mining (verifying transactions) 

Cryptocurrency mining means that you receive virtual currency in return for verification activity. Mining usually requires computing power for the method “Proof of Work” to verify transactions on the blockchain and to extract virtual currency. The mining of bitcoin, for example, requires the provision of specialized computer equipment and software for bitcoin mining (ASIC miners) and a relatively high consumption of electricity that can contribute to the verification. The mining can be of a very different scope and may be considered a business activity if the business requirements are met. 

Normally, mining with your personal PC will not be considered a taxable business activity. 

If you’ve made major investments in computer equipment (such as ASICs or specialized GPUs) to engage in mining, this will indicate that you’re running a business. If you invest in one or more large data rigs designed for mining and carry out daily or regular administrative activity with these, the requirement for business activity will normally be met. The decisive factor for considering the activity requirement for the mining to be fulfilled will be that the activity related to the follow-up of the mining is regular and of a certain scope; sporadic follow-up will normally not satisfy the activity requirement. If you outsource the operation and follow-up of the system to others, their activity must be included in the business assessment. 

If you only start the rig with mining and it does not require further administrative follow-up, the business activity requirement will rarely be met. 

If the mining you carry out constitutes a business activity, this means that the value of the cryptocurrency received through the verification activity must be recognised as income at its market value in Norwegian kroner at the time you obtain an unconditional right to it. This means that cryptocurrency mined during the income year must be recognised as income on an ongoing basis at the time of mining. 

Income recognition of cryptocurrency 

When you run a business with either cryptocurrency trading or cryptocurrency mining, you must continuously recognise income from cryptocurrency and realised gains for sold cryptocurrency. You’re similarly entitled to an ongoing deduction for expenses related to the business and for realised losses on the sale of the cryptocurrency. The income and expenses must always be converted to the value in Norwegian kroner. 

Changes in the value of a holding of cryptocurrency owned in the business are taxed as capital income in the business upon realisation. Gains are taxable income, while losses entitle you to a deduction in the business. The input value of, for example, a mined bitcoin is the same value that must be recognised as income, that is,  the sales value of the bitcoin in Norwegian kroner at the time the bitcoin was mined. 

If you acquire fixed assets to run your business, the acquired fixed assets must follow the general deduction rules for fixed assets in your business. This essentially means that ongoing expenses (such as electricity, rent, wages, etc.) are deducted on an ongoing basis. Investments in fixed assets with a cost of less than NOK 30,000 can be deducted on an ongoing basis, while fixed assets with a cost price of NOK 30,000 or more must be depreciated in the balance. 

When you run a business, it’s the year's total net profit/loss in the business that becomes taxable. 

Tax classification and valuation of company owned cryptocurrency 

A business that owns virtual assets must classify and value these for tax purposes. According to current regulations, cryptocurrency and other virtual assets will normally be classified as either intangible assets or goods. 

The tax classification must be made after a specific assessment where the intention of the purchase, the use and the duration of the activity are factors in the assessment. The accounting classification may nevertheless be relevant for tax purposes and for intangible assets it will be. 

Although cryptocurrencies and other virtual assets are not currently specifically mentioned in Norwegian accounting rules or accounting standards, it’s the characteristics they do and do not have that mean that intangible assets and goods are considered suitable for accounting purposes. 

Wealth calculation for owners 

The tax rules in Norway are such that only personal taxpayers are required to pay net wealth tax. When a company owns bitcoin or other virtual assets, it’s the owners of the company who may be subject to net wealth tax on these values. The virtual assets will then be included in the total taxable value of the company. If it’s a listed company, the share price as at 1 January in the tax assessment year will determine the taxable value that’s to be allocated to the shareholders. For companies that are not listed, the values of virtual assets will be included in the total calculated company value in accordance with the classification and valuation of taxable value as shown in the section above. In accordance with the current regulations (2026), a 20 percent wealth discount will be given for ownership in private limited liability companies and partnership-like companies for personal taxpayers. 

Ownership of virtual assets in sole proprietorships is included in the wealth calculation of the owner's personal wealth with valuation of taxable value as intangible assets or goods as shown above in the section on tax classification and valuation - if it’s part of the business. 

Value added tax treatment of cryptocurrency 

The use of cryptocurrency as a means of payment and services relating to the exchange of cryptocurrency will often be covered by the exemption from value added tax on financial services. In that case, value added tax shall not be calculated on the consideration for the exchange. This applies if it’s accepted by the parties to a transaction as an alternative means of payment and has no other purpose than to be used as a means of payment. 

Cryptocurrency exchanges, such as bitcoin, may be covered by the financial services exemption if the type of cryptocurrency in question is accepted by the parties in a transaction as an alternative means of payment and has no purpose other than to be used as a means of payment. In that case, value added tax shall not be calculated on the consideration for the exchange. 

Even if an owner of cryptocurrency considers it to be an investment object, this does not change the tax assessment of the currency as a means of payment, see the condition that it cannot have any other purpose than to be used as a means of payment. The same will apply to the assessment of the consideration charged when exchanging cryptocurrency. This entails the same tax treatment as for traditional currency, which can serve as both a means of payment and an investment object without affecting the tax treatment in connection with the exchange of currency or the use of currency as a means of payment.  

Value added tax on mining 

Mining of cryptocurrencies such as bitcoins involves services that are covered by the financial services exemption. 

Tax and value added tax of ICO 

The term ICO or Initial Coin Offering describes a situation where, for example, an entrepreneurial company can raise funding through investors subscribing for so-called "tokens". Since ICOs are very different and vary greatly, it must be assessed in each individual case how it’s to be treated in terms of tax and value added tax. 

In relation to the question of value added tax in connection with ICOs, it must be specifically assessed both whether there’s turnover and what has been traded in the case, including whether it may be considered a financial service or not.