Tax for foreign workers
When you as a foreign employer bring your employees to Norway to work here, you will generally be obliged to report salaries, payroll withholding tax and employer's National Insurance contributions to the Norwegian Tax Administration. This applies regardless of whether or not any tax is payable in Norway. The tax liability will depend on how long the employee will be in Norway and what tax treaties apply between the employee's home country and Norway.
Simplified tax scheme (payroll withholding tax scheme)
This scheme primarily applies to foreign workers who work in Norway for short periods of time and are not resident in Norway for tax purposes. The scheme also applies to foreign workers in the year in which they become resident in Norway for tax purposes.
Under the scheme, you as employer must deduct 25 percent tax, including 8.2 percent National Insurance contributions, directly from the worker's salary, so that the tax has been settled in full when the worker receives their salary. The worker cannot claim deductions and will not be required to submit a tax return.
Reporting for employees
All employees must be registered with NAV via the a-melding, unless your business is obliged to report the assignment to the tax office. If so, you must declare the workers using form "RF 1198 - Information about contracts, contractors and employees" instead.
Paying tax and duties
If the employee is liable to pay tax to Norway, the tax deduction will be paid every other month. Settlements concerning payroll withholding tax and employer's National Insurance contributions must be paid to the Norwegian Tax Administration. If your business is registered under municipality number 2312, you must make payments to the International Tax Collection Office.
The amount of tax that must be deducted will be stated in the employee's tax deduction card, which you must download from altinn.no.
Tax deduction cards
In order to be allocated a tax deduction card, you must visit the tax office to verify your identity. At the tax office, you must submit an application for a tax deduction card, present valid identification and an employment contract/confirmation which documents the work assignment. If the employee comes from a country outside the EU/EEA, he or she must document that they are entitled to work in Norway.
On the tax deduction card, the workers must tick the box to indicate whether they wish to be taxed according to the ordinary tax rules. If the employee does not indicate an option and the other tax-related circumstances facilitate it, the worker will be taxed according to the rules of the simplified scheme.
Exemptions from deductions
If you have reason to believe that the salary income will not be taxed in Norway, you can contact the employee's tax office and request a statement of exemption from payroll withholding tax.
Employer's National Insurance contributions
Employer's National Insurance contributions must also generally be paid on the employee's salary. This money is used to help fund the Norwegian National Insurance scheme. If an employee pays National Insurance contributions in their home country and has an A1 exemption form, you as employer may be exempted from paying employer's National Insurance contributions in Norway. The foreign A1 form must be sent to NAV.