NORWAY Law and Practice Contributed by: Harald Sætermo, LexOslo
Registration of a transfer of title to Norwegian real estate is normally subject to stamp duty of 2.5% of the property’s sale value at registration. The duty is calculated on the higher of the purchase price and market value at the time of registration and is pay - able upon registration with the Norwegian Map - ping Authority. Certain exemptions apply, including transfers carried out as part of qualifying mergers or demergers under the Companies Act. Share deals involving property-owning companies are commonly used because the transfer of shares does not trigger stamp duty, although other tax and commercial impli - cations should be assessed. Pillar Two Norway has implemented Pillar Two through the Glob - al Minimum Tax Act, effective from 1 January 2024, for groups within the OECD/GloBE scope. Norway has introduced a domestic minimum top-up tax. The OECD central record lists Norway’s domestic mini - mum top-up tax as having QDMTT safe harbour sta - tus, effective 1 January 2024. 5.3 Available Tax Credits/Incentives Norway has relatively few broad tax incentives. The main generally available tax incentive is the Skatte - FUNN research and development scheme. Norwegian companies and Norwegian branches of foreign com - panies may apply for a tax deduction of 19% of quali - fying R&D project costs approved by the Research Council of Norway. The deduction applies to quali - fying project costs, subject to the applicable annual cost cap, currently NOK25 million. If the company has no taxable income, the tax value may be refunded. The scheme is rights-based and available across sec - tors, provided the project qualifies as research and development and the applicant is subject to Norwe - gian tax. Where R&D services are purchased from a third-party provider, the deduction only applies to costs incurred with providers established in the EEA or in countries with which Norway has concluded a tax treaty or tax information exchange agreement. Norway also has a special tonnage tax regime for qualifying shipping companies. Companies within the regime are not taxed under the ordinary corpo - rate income tax rules. Tax liability is instead calculated
based on the net tonnage of relevant vessels and days in operation, irrespective of actual profits or losses. The regime is intended to provide predictable taxation for qualifying shipping activities. There are also favourable tax rules for employee share options in qualifying start-up and growth companies, intended to support recruitment and retention of key personnel. The scheme generally defers taxation until the shares are sold, at which point any gain is normally taxed under the rules for share income rather than as salary. The scheme is subject to detailed conditions, including requirements relating to the company, the employee, the option terms and the timing of exercise and sale. 5.4 Tax Consolidation Norway does not have a formal tax consolidation or fiscal unity regime under which group companies are taxed as a single taxpayer. Each company is taxed separately. In practice, tax equalisation within Norwegian groups may be achieved through group contributions. A Norwegian company may generally deduct a group contribution to another Norwegian group company, provided the recipient includes the contribution as taxable income. The rules require, broadly, more than 90% common ownership and voting control, directly or indirectly, at the end of the income year. Group contributions are commonly used to offset taxable profits and losses within Norwegian groups. The contribution must be lawful under company law, including rules on distributable equity, and must be properly approved and documented. The rules also contain limited EEA-related excep - tions, but the practical scope is significantly narrower than for domestic Norwegian group contributions and depends on detailed conditions. For most foreign investors, the key point is that Norwegian subsidiaries are taxed separately, but Norwegian group companies can often achieve tax equalisation through deductible group contributions.
795 CHAMBERS.COM
Powered by FlippingBook