Norway’s national budget for 2022 has just been publised. The government has decided to reintroduce the temporarily suspended Air Passenger Tax since March 2020 due to the covid-19 pandemic. The suspension will be valid to 31.12.2021. Further, the government has also proposed that low and zero emission aircrafts can be exempted for Air Passenger Tax.
The Air Passenger Tax will come into effect from 01.01.2022. The new tax rates are as follow:
Final destination in Europe: NOK 80 per passenger
Final destination in the rest of the world: NOK 214 per passenger
The tax is applied based on the date when a flight takes off from a Norwegian airport. So the time of ticket sale is not a deciding factor on whether the air passenger tax should be applied. The Air Passenger Tax shall be reported monthly with a deadlne on the 18th of the following month. The first reporting period after the reintroduction of the tax is on 18th February 2022 for January month.
Foreign Airlines must register in the Air Passenger Tax scheme through a local representative. Contact ECOVIS to find out how we can assist with registration and reporting.
Green country, red country, deep red, orange or purple country. What does it mean? Can I enter? Will I need to quarantine?
It is a lot of information, and it can be confusing when trying to find out what it all means for you. We will try and make it a little easier.
At https://www.fhi.no/en/ you can see an updated map every Monday of the various countries and the color they currently have.
First, we will look at those within EU/Schengen/UK.
- Green countries: you can travel to Norway even if you do not have your vaccine pass. You will need to be able to show that you reside in the green country and not just passed through. You do not need to test before you enter Norway or quarantine. However, you will need to test yourself at the border and register your entry: https://reg.entrynorway.no/ If you have a valid corona certificate that follows the EU rules for digital corona certificate, you will not need to be tested at the border or register your entry.
- Other’s that can enter within EU/Schengen/UK: if you have a Covid-19 certificate (Norwegian, Danish, Swedish or EU digital COVID certificate) with a QR code that can be verified by the Norwegian authorities that proves you have had the vaccination or previous illness, you can enter.
- Those that does not come from a green country or can prove they have a valid certificate, will have to quarantine.
Some countries outside of the EU/Schengen area now have a purple color. A purple third country means you can enter if you are to visit a family member (spouse, cohabitant, children, grandchildren, great grandchildren, parents or grandparents) or a boyfriend/girlfriend. You will need to send an application to UDI. People from these countries will need to quarantine upon arrival. If you want to read more about quarantine, please visit: https://www.helsenorge.no/en/ For additional information about exemptions, kindly visit this link to get the latest updated information: https://www.udi.no/en/about-the-corona-situation/i-am-abroad/residing-in-the-eu-eea-schengen-or-the-uk/
We are very excited to announce that ECOVIS opens a new office in Stavanger today! Our new office is part of ECOVIS Mobility Services AS and provides mobility and relocation services for international enterprises and individuals. With our local presence in Stavanger, we have the opportunity to closely serve our clients and provide more customed services.
We warmly welcome our regional manager Stian Sivertsen to join the team. Stian is a veteran in the mobility and relocation industry and has great knowledge of stavanger region. He is more than happy to assist you with work permit, local registration, house finding and more.
How to find us in Stavanger?
Stian Sivertsen (Regional Manager)
Address: Løkkeveien 105-111, 4007 Stavanger.
If you would like to start your own business in Norway, the big question is: Should I establish a limited liability company, an NUF or should I choose to be self-employed? Think carefully and choose the right form of company from the start, and you won’t have to spend time and money on a conversion later.
Limited liability company – AS
Limited liability companies are most often recommended as an organizational form. The main reason is that, by operating an AS, you cannot lose more than you have paid into deposits. The deposit must be a minimum of NOK 30,000.
In addition, limited liability companies are most recognized form of company in Norwegian market with well-established regulations that create trust with the counterparty and the customer.
A limited liability company is a separate legal entity, but that is not the case for a sole proprietorship. It is the AS that formally takes all actions and responds to all obligations incurred by the company.
With a limited liability company you can hire yourself as the employee, which gives you pension and social security rights. You can also withdraw the salary you need as long as the operation of your AS can withstand it.
If you receive dividends from the company, you must pay tax on the dividend. The tax rate is 22% for 2020.
Tax on dividends is calculated according to a separate method called the shareholder model. The dividend shall be reduced by a tax-free amount (shielding allowance) and multiplied by a factor of 1.44 before tax is calculated.
Norwegian branch of foreign enterprises – NUF
Establishing of NUF requires that you establish/use an established foreign enterprise, which then establishes a department in Norway. This foreign enterprise (headquarter) can be both limited liability company and sole proprietorship.
The regulations for the establishment of foreign enterprises will depend on the country in which you establish the enterprise. If your foreign enterprise is resident in one of the EEA states, and you come to Norway to do short-term projects, NUF can be the suitable option for you.
If the building/installation project is less than 6 months/12 months – depending on the tax treaty between your resident country and Norway, and your NUF does not have any permanent establishment in Norway, the NUF will not be tax liable to Norway. NUF without permanent establishment does not have accounting obligation to Norway, which means the company does not need to submit annual accounts if the annual turnover is less than 6 million NOK.
Although your NUF might not be tax liable to Norway, you still need to submit the tax return. The deadline for submitting tax return is 31st of May. For the tax return, the enforcement fine is NOK 600 per day. The maximum amount is NOK 59 950.
If the NUF undertakes enterprise assignment, the workers on the assignments will not be tax liable to Norway for short stay in Norway. But if assignment is considered as hiring labor, the workers will be tax liable from day 1.
There are some other requirements with NUF – employment business set up. For example:
- HSE card for employee working with installation and construction
- Contract, contractor, and employees report (RF-1199/RF-1198)
More details about obligations for a NUF can be found here: Norwegian Branch for a foreign company
Sole proprietorships – EPF
There are three advantages of a sole proprietorship.
- This gives you the opportunity to deduct a loss in other income.
- There are fewer formalities. Sole proprietorships are an organizational form that normally has less administrative and start-up costs than an AS, because there are fewer reporting requirements.
- EPF doesn’t require any share capital.
But remember with a sole proprietorship, you are personally responsible for the company.
By far the main disadvantage of sole proprietorships is the personal responsibility. Since a sole proprietorship is not a separate legal entity, it will be the case that if the company goes bankrupt, coverage for outstanding can be sought in your personal wealth and income. This means you and the company have the same “wallet”.
Therefore: if you are engaged in an activity that can create a liability/compensation situation that goes beyond the values of the sole proprietorship, you should think carefully before choosing sole proprietorships as an organizational form.
Many believe that one of the biggest disadvantages of sole proprietorships is that any profits you receive in operations are taxed on an ongoing basis. In other words, you have no possibility of “saving” profits in operations, as you have in an AS.
Submit Tax Return for all three company forms
No matter what company form you chose, it’s the company’s obligation to submit yearly tax return. Deadline for tax return 2020 is 31 May 2021. Contact ECOVIS now for assistance!
After BREXIT, those who hold a UK passport and that will be going to work offshore on the Norwegian continental shelf, most likely will now need a work permit before going offshore. ECOVIS will evaluate the situation to see if a work permit is needed so both the employee and the employer are being compliant.
You will need a work permit to go offshore if one or more of the requirements below applies to you:
- You will be working on a fixed installation
- The installation is in production
- The installation is tied to a fixed platform
- You will be working more than 90 days during a 180 day period
ECOVIS are happy to assist with getting your work permit filed correctly and efficiently with the immigration authorities.
By Joseph Kinane, Operations Manager @Ecovis
There are so many elements to moving abroad, from obtaining a work permit to tax registration to opening a bank account and learning the language for example. However, it is finding a suitable place to live which can often be the most personal and critical factor when moving to a new country. This is even more prevalent when a family is relocating with the expat.
I have worked a great deal in the area of housing expats since moving to Norway in 2012, accompanying many individual expats with their families to attend viewing after viewing in pursuit of the house or apartment they can call home. It is thoroughly rewarding when they find something that fits their criteria. I remind our clients that it pays to get advice and to take your time before jumping into a decision.
The property market in Norway moves fast with a lot more demand than supply, particularly in Oslo and the more populated cities. The standard is minimalistic in this country which often surprises expats who have experienced a different level in other countries. The negotiation process is also different. You may not always get your first choice and owners may not wait around too long for you to decide.
At Ecovis, we have several clients building data centres and construction companies sending workers to Norway on projects. These workers need assistance to get to work and we know how complicated this can be, particularly with BREXIT.
Our company has a large network within the housing industry. This network refers to real estate agents, private homeowners and serviced apartment companies. We also deal with several hotel chains; therefore, you are guaranteed to get the best deal possible with our assistance. We cater for any length of stay and have contacts all over Norway.
From my experience in this global mobility industry, I have noticed more and more how expats appreciate the perks of having an agent/representative throughout the moving process. The more we do, the less they do and the more efficient and cost effective the solution is for the employer. Research shows that it can cost a company three times the yearly salary of an employee when sending him/her on a traditional 3-year international assignment. It is therefore imperative that the expats and their families receive the best possible attention in order to maximise the investment.
When acquiring the services of Ecovis, you are guaranteed experienced professionals with knowledge and enthusiasm. We represent, we negotiate, and above all, we deliver.
Norway has become a hotspot for construction of datacenters.
Norway’s ideal climate, combined with Norwegian authorities’ willingness to facilitate for the construction of datacenters have been tipped to increase the demand for workforce significantly the coming years.
Global companies are now looking towards Norway for their next datacenter projects, leading to an increase of demand for foreign skilled workers.
Due to the high demand of employees linked to these projects, it will also be of high importance for all involved companies to make sure they operate compliantly, both on company and employee level.
ECOVIS have been assisting several foreign companies involved in the construction of different data centers, meaning we are well aware of the requirements for both companies and their foreign employees working on these projects.
For international companies involved in building datacenter projects, many obligations shall be taken care of. A good way to start is to map out a plan of action in regard of complex stautory regulations on registration, tax liability, accounting requirement and other aspects. Depending on the character of proejct, the tax-liability in Norway can vary quite a lot.
We support different companies with facilitating work & residence permits for their employees, company formation, payroll, tax advisory, HSE-cards, potential housing services etc, meaning the employer only have 1 point of contact during the whole process, ensuring these critical topics are covered by a local professional compliance partner.
Foreign companies operating in Norway have many compliance issues to worry about, and the company tax return and annual accounts are two more reports to keep in mind. ECOVIS have the expertise to assist your company with accounting and reporting.
What is the tax return and the annual accounts?
The tax return is a company’s tax assessment for the previous year, and it shows how the taxable profit has been calculated . Together with the annual accounts, it gives a complete overview of status from last year, including profit/loss and balance statement.
Who should submit tax return?
All taxable businesses must submit a tax return including Norwegian branch of a foreign company (NUF). Sole proprietorships and partners in shared liability partnerships must submit form RF-1030 Tax return for self-employed persons etc. Private limited companies, cooperatives and other non-personal taxpayers must submit form RF-1028 Tax return for corporations. The taxpayer is responsible for reporting the taxable income in the tax return, which will be the basis for the tax assessment. The due date for the tax return is the 31st of May.
Who should submit the Annual accounts?
If the enterprise is required to prepare accounts, the enterprise must submit annual accounts and any annual reports to the Register of Company.
Annual accounts must be prepared in accordance with the provisions of the Accounting Act and associated regulations, as well as generally accepted accounting practice. Separate simplified rules have been drawn up for generally accepted accounting practice in small enterprises. The annual accounts should be filed by the 31st of July.
A complete set of annual accounts must include the following:
- Income statement
- Balance sheet
- Cash flow analysis (not small enterprises)
- Audit report (if subject to the audit obligation)
What if I submit the tax return too late?
You may be required to pay additional tax if you do not provide accurate and complete information in your tax return. If you fail to meet the deadline, you risk receiving an enforcement fine. If you still do not submit the information, we may impose a non-compliance penalty.
For the tax return, the rate is half a court fee per day. The maximum limit is 50 court fees. The maximum amount is NOK 58,600.
What is general meeting?
The general meeting is the supreme authority in a company. An ordinary general meeting must be held within six months after the end of each financial year. The Board issues notice to convene the Annual General Meeting, and the shareholders have a right to attend and cast their votes.
The board shall summon shareholders to the general meeting and prepare a proposed agenda in accordance with the applicable provisions laid down in the law and the articles of association. The summons must be sent by the board no later than one week prior to the general meeting. Any attachments to the summons must also be made available to the shareholders no later than one week prior to the general meeting, so that they have sufficient time to familiarize themselves with the matters before they are considered.
What is the Shareholder Register Statement (RF-1086 form)?
The Shareholder Register Statement (RF-1086 Form) is a record of all the active and former owners of a company’s shares. The shareholder register includes details of shareholders, such as their name, ID number, address, how many shares they own, what class, the price paid for the shares, when they became a shareholder and when they ceased to be a shareholder.
Who should deliver it?
All Norwegian private and public limited liability companies and savings banks with equity certificates must submit an annual shareholder register statement.
The shareholder register statement must be submitted in Altinn before the 31st of January each year for the previous year. Deadline for the submission for 2020 is 31st of January 2021.
What are the consequences if it is not approved?
If the shareholder register statement is not approved, the Tax Administration lacks the basis for issuing the Shareholder’s tax report (RF-1088).
This means that taxable amounts are not pre-completed in the shareholders’ tax return. These shareholders cannot make use of the tax return submission exemption, and therefore must submit the report Shares and units in funds (RF-1159) in addition to the tax return.
What are the consequences if it is delivered after the deadline or the information is incorrect?
The Norwegian Tax Administration will charge a continuous coercive fine NOK 1 172 per date from the 01st of February 2021 until the correct shareholder register statement is submitted. The fine can run to an upper limit of 50 days, which means you can risk being charged NOK 58 600 if the reporting obligation is not fulfilled.
We can help!
Please send the information below to firstname.lastname@example.org or fill in the contact form below so we can help you to submit the shareholder register statement!
- The name and organization number of the company
- Your email address and your telephone number
- Total share capital for the company and nominal value per share
- Total property value of the company
- Has there been issued any loan from the company to the shareholders or has there been paid out any ordinary dividend to the shareholders in 2020?
- Have any new shares been issued through foundation, new share issue, transformation or in any other way?
- Have any shares been deleted, for example by liquidation, a taxable merger/demerger, etc.?
- Have there been any reductions for increase in share capital or nominal value?