Refund of withholding tax on share dividends
As a foreign shareholder, you may have limited tax liability to Norway for share dividends you've received from Norwegian companies. As a rule, the Norwegian distributing company must deduct 25 percent withholding tax on dividends. The tax rate may however be reduced in accordance with tax treaties or Norwegian tax regulations.
If you're entitled to a lower tax rate than the tax rate deducted on your dividend payment, you can apply for a refund of too much paid withholding tax. Only shareholders who are final dividend recipients can claim a refund of withholding tax.
You can apply for a refund of withholding tax when the distributing company’s deadline for correction has passed
The company determines withholding tax by submitting a notification of withholding tax on share dividends. The company may submit a correction up to 3 months after submitting the notification of deduction, and until 31 December of the income year. This way, the company can correct errors in previously submitted notifications.
The correction deadline must have passed before you can apply for refund of withholding tax. This usually means three months after the dividend payment.
The application deadline is 5 years
The deadline for applying for a refund of withholding tax is five years. The deadline is calculated from the end of the income year when the dividend is paid. For example, if you received a dividend payment in August 2020, you can apply for a refund of withholding tax on this dividend no later than 31 December 2025.
Send the application to
Postboks 9200 Grønland
If you have questions about refund of withholding tax on dividends, you can contact us by e-mail at [email protected]
- Tax identification number (tax ID/TIN)
- Total amount of refund claimed
- If you’ve received several dividends, you must include an overview of all the dividends and the total expected refund amount per year
- If you’re a corporate shareholder, you must specify in the application if you apply for a refund under a tax treaty or the exemption method (section 2-38 of the Tax Act)
- If you apply under a tax treaty:
- A certificate of residence issued by the tax authorities in your country of residence, specifically confirming that you're resident for tax purposes in that country under the tax treaty with Norway. The certificate of residence must be issued in the shareholder's name alone, and must be valid for the year when dividends were paid.
- If you apply under the exemption method:
- A certificate of residence or certificate of registration issued by a public authority as confirmation that the shareholder is legally established within the EEA.
- A statement of the organisational structure, including an evaluation of which Norwegian entity the shareholder is comparable to in section 2-38, subsection 1, letters a-h, of the Tax Act
- Grounds for why the shareholder should be considered as genuinely established and to be carrying out genuine economic activity within the EEA pursuant to the section 2-38, subsection 5, of the NorwegianTax Act
- A credit advice (dividend receipt)proving that you’ve received the dividend. The receipt must be issued by a bank and contain the following:
- name of the final dividend recipient
- name and ISIN on the share
- number of shares and gross dividend per share in NOK
- payment date, ex-date or record date
- total gross amount and deducted withholding tax in NOK (it must specifically state that withholding tax has been deducted, not just tax)
- If the dividend has gone through several transactions, the entire transaction chain must be documented.
- VPS account number and the name of the account holder in the Norwegian Central Securities Depository (CSD) on which the shares were registered when dividend was paid.
- If the shares were registered on a nominee account (NOM account), you must provide the account number and the name of the custodian holding the account
- If you do not have VPS account information, contact your custodian or the account operator to receive this information
- Payment information:
- The IBAN account must accept NOK since all refunds are transferred in NOK
- Name of the account holder
- A Norwegian account number or IBAN and SWIFT/BIC code
- Payment reference of maximum 20 characters will simplify the payment
- Other relevant information, including legal, organisational and tax related circumstances
The application must be signed by the final dividend recipient. If a representative of the final dividend recipient submits the application, a signed power of attorney must be presented.
All required documentation must be included in the application. Insufficient documentation or information results in longer processing time, and the application may be rejected or dismissed. Additional information may be relevant in order to show that the requirements for reduced withholding tax have been fulfilled.
Possible bases for refund of withholding tax
- Tax treaty
If you’re a tax resident in a country with which Norway has a tax treaty, the withholding tax rate is usually 15 percent. Rates according to different tax treaties are available at regjeringen.no/kildesatser
Some tax treaties have different requirements, but most treaties require that the shareholder is a tax resident in the contracting state and the beneficial owner of dividends. The tax treaties are available at regjeringen.no/tax-treaties
- The shareholder model (shielding deduction)
If you’re a tax resident within the EEA and a final dividend recipient, the withholding tax may be reduced by deduction for risk-free return if the rate of withholding tax is higher than tax on dividends after risk-free return. Usually, it's not possible to receive a full refund of withholding tax under the shareholder model. Information stating that claims submitted according to the shareholder model always entitle you to a full refund of withholding tax is incorrect. Read more about the shareholder model and deduction for risk-free return.
Please note that refunds under a tax treaty are usually more profitable than refunds under the shareholder model.
- Tax treaty
If the shareholder is a tax resident in a country with which Norway has a tax treaty, the withholding tax rate is usually 15 percent. Rates according to different tax treaties are available at regjeringen.no/kildesatser. Some tax treaties have different requirements, but most treaties require that the shareholder is a tax resident in the contracting state and the beneficial owner of dividends. The tax treaties are available at regjeringen.no/tax-treaties.
- Exemption method
Some corporate shareholders domiciled within the EEA may be entitled to exemption from withholding tax according to the exemption method in section 2-38 of the Norwegian Tax Act. In order to claim a refund under the exemption method, the shareholder must be comparable to one of the Norwegian taxable entities listed under section 2-38, subsection 1, letters a-h, of the Tax Act. The shareholder must also be genuinely established and carry on genuine economic activity in an EEA country, see section 2-38, subsection 5, of the Tax Act. The shareholder must also be the final dividend recipient.
Brexit: New rules for corporate shareholders resident in the United Kingdom
The United Kingdom left the EU on 31 January 2020, and the transitional period where the United Kingdom was treated as if the country was still a member of the EU and the EEA expired on 31 December 2020.
No longer comprised by the exemption method
From 1 January 2021, Norway's relationship with the United Kingdom is no longer regulated by the EEA Agreement. This means that certain corporate shareholders resident in the United Kingdom are no longer comprised by the exemption method (section 2-38 of the Norwegian Tax Act). Consequently, they're not entitled to exemption from withholding tax under the exemption method after this date.
Special provisions in the tax treaty
Corporate shareholders can be entitled to a reduced or 0 percent withholding tax rate according to the double taxation treaty between Norway and the United Kingdom. Under the treaty, the tax rate is usually reduced to 15 percent. Certain corporate shareholders may be entitled to a 0 percent tax rate if they fulfil the requirements under a special provision in the treaty.
Corporate shareholders that directly or indirectly owns at least 10 percent of the capital in the Norwegian distributing company may be entitled to a 0 percent withholding tax rate according to Article 10, no. 2, letter b (i) in the tax treaty.
Approved pension schemes may be entitled to a 0 percent tax rate pursuant to Article 10, no. 2, letter b (ii), and the same applies to parts of the British Government as described in Article 10, no. 3, letter b (ii).
Corporate shareholders must provide documentation showing they fulfil the conditions under a special provision in the treaty.
Do you want to avoid the refund process?
Foreign shareholders can avoid having to apply for refund of withholding tax. The correct withholding tax rate can be deducted immediately when dividend is paid if the shareholder has provided the required documentation to be entitled to a reduced withholding tax rate.