Allowance rates for subsistence allowance not subject to withholding tax
In the case of travel involving one or more overnight stays, it is the place where the person concerned actually stays overnight (type of accommodation) that determines what you can be paid in subsistence allowance not subject to withholding tax. Subsistence allowance not subject to withholding tax is what can be paid without prepayment deductions being made.
As the State budget is not finally approved, it can be changes.
Travel without overnight stays
In the case of travel without an overnight stay, the following rates apply for 2020:
The Directorate of Taxes’ allowance rates for subsistence allowance not subject to withholding tax without an overnight stay - domestic and abroad.
6 til 12 hours
Over 12 hours
If your employer, client or host covers your diet, the rates will be reduced. The allowance which is not subject to withholding tax must be reduced by 20 percent for breakfast, 30 percent for lunch and 50 percent for evening meal (the amounts must be rounded up or down to the nearest whole krone).
In addition, special regulation as to the filling of a claims form for travel expenses must be met in order for your employer to pay allowances without withholding tax.
Travel with overnight stays
In the case of travel involving overnight stays, it’s the place where you actually stay overnight (type of accommodation) that determines what you can be paid in subsistence allowance not subject to withholding tax. In addition, the distinction between work-related travels and commuter travels can be of significance if the accommodation is private or a bedsit/portacabin with cooking facilities.
For travels of 6 hours or more into a day without overnight stay (commenced day), an allowance for subsistence is given based on the type of accommodation used on the previous overnight stay. A reduction of the subsistence allowance is made based on the rate for overnight stay for the relevant type of accommodation. The subsistence allowance reduction and surplus calculation is made per day.
If the travel has not lasted long enough to entitle subsistence allowance for the commenced day (less than 6 hours), no subsistence allowance reduction must be made. Instead, the employer can cover meals in the commenced day directly or by refunding documented expenses. This is because the surpluses and allowance reductions should be calculated per day. The rule applies even if your overnight stay is in a hotel, guesthouse or bedsit/portacabin/private. However, this is not the case when the employee stays overnight at a hotel where breakfast is included. Then an allowance reduction for breakfast should always be made, even if the employee chooses to eat the breakfast later (typically in the commenced day). The employer has already covered breakfast, and the employee cannot get this meal covered twice.
In order for the allowance to be paid entirely without being subject to withholding tax, the allowance must be within the rates below, and the specific documentation requirements laid down in the Tax Payment Regulations must be met.
Special rates concerning overnight stays at a guesthouse or in a bedsit/Portacabin/private accommodation with cooking facilities or a hotel
The Directorate of Taxes has established special rates for overnight stays at a guesthouse or in a bedsit/Portacabin/private accommodation with cooking facilities or a hotel. The rate for overnight stays in a bedsit/Portacabin or private accommodation is abolished for commuting employees. The tax-free coverage of expenses for board by an employer will not be limited by the 24-month rule, i.e. an employer can also provide tax-free coverage of additional expenses for board and lodging after the 24-month period.
A rate is also set for long-distance lorry drivers. See the table.
The Directorate of Taxes’ allowance rates for subsistence allowance not subject to withholding tax with overnight stays - domestic and abroad
|For employees staying in a guesthouse or bedsit/Portacabin without cooking facilities||NOK 164|
|For employees on a business trip staying in a bedsit/Portacabin with cooking facilities or private accommodation||NOK 91|
|For employees staying at a hotel||NOK 589|
For employees staying at a hotel with breakfast included (who would have been entitled to a deduction for additional expenses for board), the hotel rate is reduced by 20 percent.
If the employee’s expenses for one or more meals are also covered, the allowance which is not subject to withholding tax must be reduced by 20 percent for breakfast, 30 percent for lunch and 50 percent for evening meal (the amounts must be rounded up or down to the nearest whole krone). See the examples of how the rates should be interpreted. Meal reduce and surplus calculations are made per day.
|For long-distance lorry drivers (who would have been entitled to a deduction for additional expenses for board)||NOK 300|
Examples showing how the rates are to be interpreted:
An employee is on a business trip and stays at a hotel in order to attend a meeting. The person has breakfast during the meeting which is included in the price. The correct rate will then be NOK 471. (Reduced by 20 percent for breakfast). However, if the employee has to pay for breakfast themselves at the meeting place, the correct rate will be NOK 589.
An employee is on a business trip and stays at a hotel in order to attend a course. The person has their expenses for breakfast and lunch covered. The correct rate which must be applied in connection with this will be NOK 294 (NOK 589 - 20 percent for breakfast - 30 percent for lunch).