Work in Norway
When personnel are supplied to work in Norway, the contractor, the subcontractor and the principal are joint and equally responsible for the withholding of taxes and the payment of contributions to the Norwegian National Insurance Scheme.
To become acquainted with the relevant laws and regulations, involves time-consuming investigations. If you get an audit inspection, even the smallest error can lead to penalties or fines. This applies to both your company and your employees.
When you let Magnus Legal take care of the reporting obligations related to Norwegian activity including payroll services, you are guaranteed a correct assessment for the Norwegian Tax Authorities. You will not need to worry about choosing the correct deductions or about any recent changes in legal regulations.
We also solve legal issues related to Norwegian tax and social security contribution, employment contracts and labour law as well as other relevant areas of commercial law.
Work in Norway - our services
- Employer’s registration of a contract and of an employee
- Employee’s application for a tax deduction card
- Application for a Norwegian ID-number and identity check
- ID-cards for construction workers
- Payroll routines and salary withholding tax compliance
- National Insurance Scheme and social security contribution
- Individual income tax computations and tax equalisation
- Filing of individual tax return
- Labour Law
Work permit in Norway
Do your employees need a work permit in Norway or is it possible for a foreigner to sign a contract and start working in Norway without a work permit?
Work permits are linked to residence permits and are dependant on the person’s competence, citizenship and the type and length of work in Norway.
In this blog we have outlined the main rules related to work permits in Norway.
Work permits for skilled workers
A residence permit for skilled workers is a type of permit that gives access to staying and working in Norway.
Several requirements must be met to qualify for a skilled worker’s permit. The Norwegian Directorate of Immigration will assess the application based on these requirements.
Find our more about the requirements in this blog: Work permits in Norway for skilled workers
RF-1198/RF-1199
When a foreign company has registered a business in Norway, it’s time to report their Norwegian assignment to the tax authorities.
The assignment should be reported electronically through an Altinn-based system called the “Assignment and employee register”. When accessing this system, you fill find two different forms: RF-1199 and RF-1198.
Find out more: RF-1198 and RF-1199 reporting for foreign businesses
Employer’s registration and reporting obligations
- All enterprises that have employees working in Norway, must obtain a Norwegian organisation number. This can be done by registering with the Brønnøysund Register Centre.
- Non-Norwegian employers, that assign employees to work in Norway according to a contract, are normally obliged to report the employees to Norwegian tax authorities. This reporting is done on the so-called RF-1198 form. Likewise, the client awarding the contract to the employer is responsible for filing a report called RF-1199. The reports must be filed within 14 days after the work has started.
- Furthermore, the employer is obliged to file monthly electronical reports to the tax authorities for each employee. This monthly reports relate to the salary payments, the withholding tax deducted, the social security contributions, etc.
- The employer must provide each employee with an annual statement that specifies their total salary, including all benefits and the tax deducted.
- The assignment in Norway may trigger social security contributions and Norwegian corporate tax on the employer’s hand. An assessment of tax liability and social security liability should always be made.
Employees registration and reporting obligations
- The employees must get Norwegian ID-numbers (so-called “D-number”) and tax deduction cards. To get tax deduction cards, the foreign employees should meet at a tax office for an ID-control.
- If the employees are tax residents in Norway, then they are liable for tax on their global income and wealth. In general, persons not resident in Norway are only tax liable for income from sources in Norway. This includes salary from work performed in Norway.
- Based on the reports filed by the employer, the tax office will normally provide a pre-completed individual tax return. This is normally provided in the spring the year after the income year. The employee must review and correct the tax return and claim any relevant deductions.
- In Norway, salary is taxed at progressive rates. However, foreigners who qualify for the Pay As You Earn Scheme (PAYE), may pay a flat tax rate. This rate is either 16,8 percent or 25 percent depending on the social security status of the tax payer.
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Annual wage report
Businesses that have employees who perform work in Norway must remember to file an annual wage report.
All employers and others who disburse salaries, pensions, and other remunerations must provide a yearly summary of reported information to each employee or income recipient.
Find out more about the deadline and which information to include: Annual wage report in Norway
Hiring-out of labour or construction and assembly contract?
To distinguish between hiring-out of labour and a construction and assembly contract is important to prevent unforeseen surprises from the tax office.
In the case of hiring-out of labour, the tax treaties have special provisions allowing the working state to tax the employees’ income from the first working day.
Find out more: Business in Norway: Hiring-out of labour or construction and assembly contract?
Joint and several liability
A client that issues a contract can be held responsible for the obligations the contractors down the contract chain have.
The joint and several liability applies to salaries, tax deductions and employers' National Insurance contributions in cases where the contractors breach their obligations.
Find out more: Joint and several liability
Contact us
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contact@magnuslegal.no
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