In Norway, Value-added tax (VAT), or Merverdiavgift (MVA) in Norwegian language, was introduced on on 19 June 1969 and became effective from 1st January 1970.
Since its introductions only few significant amendments took place, the first in 2001 and the second in 2009 which changed more than 130 articles in the VAT Act.
In Norway, the standard VAT rate is 25%. In case of supply of certain foodstuff the supply is subject of 15% reduced VAT rate. The VAT rate of 6% that was previously introduced ended on 30 September 2021 and from 1 October 2022, the low VAT rate of 12% will come into effect.
This VAT rate will apply to the following services
In Norway a special VAT rate of 11.11% is also applicable for fishermen’s sales exclusive the dealers.
In Norway, the registration under VAT becomes mandatory once the following thresholds are exceeded:
When the Tax Authority calculates the turnover only the goods and services are taken into account which is subject to VAT.
The Tax Authority has introduced a simplified registration to accelerate the process. Applying the new registration procedure the processing time of the VAT registration is decreased to minutes from weeks. Accordingly, the registration form cannot be submitted on paper based only electronically.
In case a foreign company without any fix establishment intends to become Norwegian-registered foreign enterprise (NUF) a tax representative’s assistance will be essential. The agent must have domicile in Norway and the in the possession of the delegated Altinn-roles the registration could be performed on behalf of the foreign company.
All taxpayers with Norwegian VAT ID must file periodic returns. Generally, the frequency is bi-monthly and the submission due date is the 1 month and 10 days following the reporting period. The due VAT liability must be paid by the submission deadline.
VAT liability applies to the following transactions:
Within the scope of the business the supply of goods and services (even self-supplies) within Norway
A registered taxable person shall issue a tax invoice on the taxable supplies performed in Norway. There is only one exception, the supply to private individuals. The tax invoice can be issued electronically or on paper base. There are no strict requirements on the electronic format; only that the authenticity of the origin and the integrity of the content should be ensured. The tax invoices must include the following information:
In Norway, in case the consideration of a supply is less than NOK 50,000 the taxpayer companies are entitled to issue simplified invoices. The invoices shall be kept for a period of 5 years. In such cases the invoice shall include the following information only:
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A new digital SAF-T based VAT return has been introduced in Norway from January 1st 2022. This is part of a new system replaced the previous manual VAT filing, with no transition period or exemptions.
There is an extension from the previous 19 boxes for reporting up to 30 boxes. 25 of these will be mandatory.
The following returns are affected:
Why the change to SAF-T?
There are numerous driving forces behind global tax digitalisation and moves towards SAF-T reporting. With the new SAF-T based VAT return, tax authorities are hoping to decrease the number of potentially erroneous submissions as well as conduct more in-depth analysis on tax reporting.
Will this be mandatory ERP System Reporting?
It is not yet mandatory for businesses to have ‘system-to-system’ reporting capabilities. For businesses without the capability of using an ERP system there will be an online portal (Mine MVA-Meldinger). Otherwise, businesses and advisors can pull VAT returns from their ERP system. Though it is not yet mandatory businesses are strongly advised to begin implementing a secure, adaptable ERP system as soon as possible.
It is hoped that the new VAT return in Norway will also bring a greater simplification to corrections. Now it is sufficient to amend data in ERP systems and submit new returns based on the updated data.
This more flexible return will replace older ones automatically. This will not require manual intervention. If the proper mapping has been applied, when the reporting system is updated there will be no requirement for supplementary returns.
A More Detailed Picture for Tax Authorities
The new returns will use a ‘code based’ approach instead of a ‘form based’ one. The 30 VAT codes will also give tax authority a more detailed picture without any impact on the aggregated level of figures in the VAT return.
The digitalised VAT return will still not be transaction level VAT reporting. This is something that Norwegian tax authorities will seek to amend in future. Already they are considering the introduction of a new Sales and Purchase Report.
In theory, this obligation would come into effect no later than 2024. It would apply to individual purchase and sales transactions. However, it should be noted that this is still in the proposal stage and under review by the Ministry of Finance.
For a deep dive into VAT reporting in Norway, get our free ebook ‘Navigating a Changing Tax Landscape – SAF-T Norway’.
From 1st January 2022, a new digital Standard Audit File for Tax (SAF-T) based VAT return has been introduced by the Norwegian tax office.
This system will replace the previous manual VAT filing form and extend the existing 19 boxes to 30, including 25 mandatory boxes.
Our experts have put together their advice on everything you need to know about the new Norway reporting system.
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