Withholding tax on pensions and disability benefits
Pensions and disability benefits paid from Norway to persons who are not tax resident in Norway are liable to tax in Norway.
This means that you are liable to tax in Norway on Norwegian pensions and Norwegian disability benefits even if you are deemed to have moved from Norway for tax purposes or have never been tax resident in Norway. The tax is 15 per cent of the gross pension/disability benefit.
Withholding tax on pensions and disability benefits covers:
- pension from the National Insurance scheme
- public occupational pensions
- private occupational pensions
- other private pensions
- disability benefits from the National Insurance Scheme
- disability benefits from other schemes
The payer of the pension/disability benefit shall deduct 15 per cent tax from the gross pension/disability benefit.
There are a few exceptions to the tax liability:
- You are not liable to pay tax on pensions and disability benefits from private occupational pension schemes and other private pension schemes if you have not earned pensions points or accumulated pension reserves in the National Insurance scheme.
- You may be entitled to full or partial tax exemption pursuant to the tax treaty with the country in which you are resident.
- You may be entitled to a lower tax rate than 15 per cent if you live in an EU/EEA country and at least 90 per cent of your total income is liable to tax in Norway.
You may be entitled to an extended deduction if you are resident in an EEA country and the income in your country of residence is too low to allow you to exercise the right to personal deductions there.
Pensions paid to children under the age of 17 are not liable to tax.
Unearned pension credits or pension funds and private pensions/disability benefits or war pensions
If you've not earned pension credits or accrued a pension fund in the Norwegian National Insurance Scheme, you’re not liable to pay tax in Norway on pension and disability benefits from private occupational pension schemes and other private pension schemes. Nor are you liable to pay tax on war pensions.
You must contact the party that pays your private pension/disability benefit and let them know that you believe the pension is not taxable in Norway.
If you receive a war pension, you must contact the tax office. If a war pension is the only pension you receive, you may apply for an exemption card. If you receive an old-age pension in addition, you may apply for a tax deduction card with a deduction rate of less than 15 percent. In that case, you must document the proportion of the pension that is war pension.
The rules on withholding tax on pensions and disability benefits apply only if you’re no longer a resident for tax purposes in Norway. If you’re still a resident for tax purposes in Norway pursuant to the Taxation Act, you’ll be taxed according to the general rules. The provisions in the tax agreement will apply to you.
How do you avoid double taxation
If your pension or disability benefit is liable to tax both in Norway and in the country where you are resident, it is your country of residence that must ensure that the pension/disability benefit is not subject to double taxation. The tax settlement shows how much tax you have paid in Norway. The tax settlement notice can be used as documentation in relation to the tax authorities in your country of residence.