How much tax do you have to pay?

Any profit will be taxed as capital income at the rate of 22 percent.

However, it’s not a given that rental income should be taxed as capital income. In some cases, rental income can be taxed as business income, at a rate of up to 50.6 percent.

Whether or not the renting out is considered commercial activity depends on an overall assessment where, among other things, the scope, frequency and duration of the rental relationship will be of importance. A commercial assessment becomes most relevant when you have several rental properties and/or frequent rental agreements.

See the guide “Am I self-employed” to find out if the renting out is considered commercial activity.

See the binding advance ruling (BFU 6/16 (in Norwegian only)) where the Directorate of Taxes concluded that the continuous short-term rental of two flats constituted a commercial activity for tax purposes.

In the case of short-term rentals, the level of activity will often be high, so that depending on the circumstances, there may be commercial activity even if only one housing unit is rented out.

If you’re not sure of how your income should be taxed, contact us.