Do you need to declare foreign property to the Norwegian tax authorities?
The tax implications of owning property abroad can be complex, so it's important to read up on the rules to make sure you end up on the right side of the tax laws.
If you're a tax resident in Norway, you're generally subject to Norwegian taxation on gains made from the sale of real estate and rental income derived from property abroad.
That means that you typically need to declare any foreign property with the Norwegian tax authorities.
READ MORE: Which municipalities in Norway charge the highest property tax?
However, if you have limited tax liability in Norway (you can find more details on when you become liable for tax and when the tax liability ceases upon moving in to and out of Norway here), you won't be taxed on foreign property, nor will you be eligible for deductions related to losses or deficits.
While it is recommended that you seek professional advice and consult the tax authorities (Skatteetaten) if you have any concerns or particular complexity regarding your property situation, The Local has compiled an overview of essential things you should know from official sources.
How Norway calculates the tax value of foreign property
The Norwegian Tax Administration caps the tax value of a property abroad at 30 percent of its market value or 30 percent of the construction costs, including the plot of land, as stated by the tax information service Nordisk eTax, a collaboration between the tax administrations of Denmark, Iceland, Norway, Finland, and Sweden.
It's important to note that Norwegian tax authorities calculate this value according to Norwegian rules, disregarding any assessments made abroad. However, you are responsible for disclosing the property's location and purchase price information.
Exceptions may apply if a tax treaty between Norway and the country where the property is located exempts the property's tax value from Norwegian taxation (more on that later).
Rental income and gains from selling a property abroad
Rental income from foreign property is typically taxable in Norway, with corresponding deductions available for deficits.
Similarly, gains from the sale of foreign property are subject to Norwegian taxation, and losses from such sales are deductible.
However, certain scenarios exempt gains from Norwegian taxation, such as using the property as a primary residence or holiday home or if it falls under the provisions of tax treaties.
Can you claim tax credits for foreign taxes paid?
If you've already paid taxes on the same wealth or income abroad, you can claim a deduction from your Norwegian tax liability for the amount paid.
Proper documentation of foreign tax payments is necessary when claiming this deduction, so make sure to enter all the relevant information in your tax return.
Furthermore, as Norway has tax treaties with several countries (which aim to prevent double taxation), your foreign property income may be exempt from Norwegian taxation.
READ MORE: What to expect if you’re buying a home in Oslo
However, if your property is situated in a country not covered by a tax treaty, it will be subject to Norwegian taxation, with deductions available for debt and interest on debt.
For a full list of countries with tax treaties with Norway, consult the Norwegian Tax Administration website.
Tax residency and commuting to Norway for work
If you commute to Norway for work while residing with your family in another country, your tax residency may vary based on applicable tax treaties.
In such cases, Norway's taxation rights on foreign income may be limited by the terms of the tax treaty between Norway and your country of residence. Contact the Tax Administration to find out which rules apply in your specific situation.
As March has several key dates in Norway's tax return season, make sure to check all the tax deadlines in 2024.
Also, these are the key things you need to know about Norway's tax deduction cards.
Wealth tax considerations
Owning property abroad may also mean you may have to consider potential wealth tax obligations. Norway's wealth tax is the sum of one's global net wealth, so minus any debts, loans of mortgages.
The tax rate ranges between 1 and 1.1 percent of one’s net wealth above 1.7 million kroner (or double that for married couples).
Therefore, any property you own abroad - especially outright - will be included into your wealth tax calculations.
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If you're a tax resident in Norway, you're generally subject to Norwegian taxation on gains made from the sale of real estate and rental income derived from property abroad.
That means that you typically need to declare any foreign property with the Norwegian tax authorities.
READ MORE: Which municipalities in Norway charge the highest property tax?
However, if you have limited tax liability in Norway (you can find more details on when you become liable for tax and when the tax liability ceases upon moving in to and out of Norway here), you won't be taxed on foreign property, nor will you be eligible for deductions related to losses or deficits.
While it is recommended that you seek professional advice and consult the tax authorities (Skatteetaten) if you have any concerns or particular complexity regarding your property situation, The Local has compiled an overview of essential things you should know from official sources.
How Norway calculates the tax value of foreign property
The Norwegian Tax Administration caps the tax value of a property abroad at 30 percent of its market value or 30 percent of the construction costs, including the plot of land, as stated by the tax information service Nordisk eTax, a collaboration between the tax administrations of Denmark, Iceland, Norway, Finland, and Sweden.
It's important to note that Norwegian tax authorities calculate this value according to Norwegian rules, disregarding any assessments made abroad. However, you are responsible for disclosing the property's location and purchase price information.
Exceptions may apply if a tax treaty between Norway and the country where the property is located exempts the property's tax value from Norwegian taxation (more on that later).
Rental income and gains from selling a property abroad
Rental income from foreign property is typically taxable in Norway, with corresponding deductions available for deficits.
Similarly, gains from the sale of foreign property are subject to Norwegian taxation, and losses from such sales are deductible.
However, certain scenarios exempt gains from Norwegian taxation, such as using the property as a primary residence or holiday home or if it falls under the provisions of tax treaties.
Can you claim tax credits for foreign taxes paid?
If you've already paid taxes on the same wealth or income abroad, you can claim a deduction from your Norwegian tax liability for the amount paid.
Proper documentation of foreign tax payments is necessary when claiming this deduction, so make sure to enter all the relevant information in your tax return.
Furthermore, as Norway has tax treaties with several countries (which aim to prevent double taxation), your foreign property income may be exempt from Norwegian taxation.
READ MORE: What to expect if you’re buying a home in Oslo
However, if your property is situated in a country not covered by a tax treaty, it will be subject to Norwegian taxation, with deductions available for debt and interest on debt.
For a full list of countries with tax treaties with Norway, consult the Norwegian Tax Administration website.
Tax residency and commuting to Norway for work
If you commute to Norway for work while residing with your family in another country, your tax residency may vary based on applicable tax treaties.
In such cases, Norway's taxation rights on foreign income may be limited by the terms of the tax treaty between Norway and your country of residence. Contact the Tax Administration to find out which rules apply in your specific situation.
As March has several key dates in Norway's tax return season, make sure to check all the tax deadlines in 2024.
Also, these are the key things you need to know about Norway's tax deduction cards.
Wealth tax considerations
Owning property abroad may also mean you may have to consider potential wealth tax obligations. Norway's wealth tax is the sum of one's global net wealth, so minus any debts, loans of mortgages.
The tax rate ranges between 1 and 1.1 percent of one’s net wealth above 1.7 million kroner (or double that for married couples).
Therefore, any property you own abroad - especially outright - will be included into your wealth tax calculations.
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