2.8.5 Income from real property abroad (RF-1189E)
Applies to the income year 2019
Under this item, you must enter the calculated profit on letting from form "RF-1189E Letting etc. of real property", in addition to profit from letting of holiday homes which you also use, and share of profit from letting distributed from spouse.
Does this item concern me?
Income from real property abroad is in principle liable to tax. If you have let property abroad, the taxable income must be entered here.
Letting of a holiday home which I also use
85 percent of income in excess of NOK 10,000 on the letting of a holiday home abroad which you also use must be entered under item 2.8.5.
If you let to family members and they pay the running expenses, you will not need to complete form RF-1189E or this item. If the person who lives there does not pay anything, it is considered to constitute the benefit of free housing and they must pay tax on that.
Is there a tax treaty between Norway and the country where the property is situated?
If there is a tax treaty, and the tax treaty uses the exemption method to avoid double taxation, income from the property is not taxable in Norway. You can find a list of countries using the exemption method here.
If there is a treaty, and the tax treaty uses the credit method to avoid double taxation, the income can be taxed in both countries.
If the income is taxable in both Norway and the country where the property is, you can claim a deduction from your Norwegian tax for the tax you have paid in the other country (credit deduction). To claim a credit deduction, you have to submit form RF-1147 "Deduction for tax paid abroad by a person (credit)". You also have to check the box for "Yes" in item 1.5.6 "Are you claiming an allowance for tax paid abroad (credit deduction)?". If you are asked to do so, you must provide documentation of the taxes that are assessed and paid abroad. You can't claim a deduction for foreign property taxes in your Norwegian tax return.
How do I enter this in my tax return?
You must submit the income abroad in item 2.8.5 and information about the country in which the property is located. Under this item, you must enter the amount from under the heading "Net income" at the bottom of form RF-1189E. When you submit electronically, the amount under item 2.8.5 will be automatically transferred from form RF-1189E.
Letting of holiday home which I also use
You enter 85 percent of the total income from letting which exceeds NOK 10 000.
If the income is distributed between spouses, only one of the spouses must fill in form RF-1189E and state the other spouse's share under item 2.11 in form RF-1189E.
You don't have to submit documentation now, but must be able to provide documentation if we request it.
If you claim a credit deduction, you must be able to provide documentation of the tax assessed and paid in the other country, should we request it.