Do foreign suppliers need to charge VAT for sales to Norway?

New regulations relating to Norway VAT on e-Services (VOES) delivered from abroad to private individuals in Norway entered into force on 1 July 2011.

Since 2001, electronic services have been subject to VAT in Norway, when supplied from vendors established in Norway.

On 10 December 2010, and as part of the 2011 Fiscal Budget, the Norwegian Parliament passed a bill making purchases of electronic services from abroad (import) by consumers in Norway also subject to VAT at the standard rate of 25 percent.

The new legislation seeks to provide a level playing field for established and non-established vendors supplying electronic services to consumers.

More: Check out the homepage of Norway’s VOES here.

Is there a VAT registration threshold?

There is a threshold of 50,000 Norwegian kroner (NOK) sales over a 12-month period. The merchant has to register from the month they exceed the threshold of NOK 50 000.

If the merchant discovers later that they have unexpectedly exceeded the threshold, then they shall backdate the time of registration (from the month they exceeded the threshold limit).

Taxamo have a threshold monitoring service available in the online merchant portal.

What e-services are in scope for VAT in Norway?

Electronic services are defined in the Norwegian Value Added Tax Act section 1-3 first paragraph letter j.

The definition in the Norwegian VAT Act is as follows:

j) electronic services: services capable of delivery from a remote location which are supplied over the internet or other electronic network and which cannot be obtained without the use of information technology, and where delivery of the services is essentially automated.

The definition is based on the EU VAT Directive (2206/112/EU) and the EU VAT Regulation (Council Implementing Regulation NO 2822011 of 15 March 2011). They can be used as guidelines when deciding what is included in the term electronic services.

Examples include the downloading of software, music, films, digital books and other electronic publications.

What is the Norwegian VAT rate?

The standard VAT rate is 25%. Digital products delivered over the internet are considered as services and not goods (cf. Odelsting Proposition number 2 (2000–01) and are liable to VAT.

How do I enable VAT for Norway in Taxamo?

Assuming your product/services qualify as digital goods/services in Norway and you are above the threshold to pay VAT in Norway, then complete the following steps:

  1. Log into the Taxamo Merchant Portal and go to: My account > Tax regions.
  2. Enable in test mode or live mode for the relevant dates.
  3. Enter your Norwegian Organisation number.

If you are using an integration other than the Taxamo API or the Taxamo checkout form, please confirm that your integration type has been upgraded to support Norway.

Is there an online system to submit VAT returns?

As an alternative to normal registration in the Norwegian VAT system, foreign suppliers can use a simplified registration and reporting system when selling services to private individuals.

Sales to businesses and public enterprises (B2B) shall still be dealt with pursuant to the normal reverse charge rules.

Registration, reporting and payment take place by following the instructions at www.voesnorway.com.

The supplier is assigned an identification number and password.

The duty to register arises when the total value of deliveries to recipients in Norway exceeds Norwegian kroner 50,000 during a period of 12 months.

Suppliers who otherwise meet the requirements can nonetheless be registered in the simplified registration system before this amount limit is exceeded.

How often are VAT returns filed?

Taxamo provide a quarterly Tax Settlement report in the merchant portal, providing values for the VAT return.

VAT must be declared and paid by the same deadlines as apply to the EU system, i.e. quarterly, with a deadline for the submission of returns and payment 20 days after the end of the period:

Reporting period VAT declaration/payment due
1 July to 30 September 20 October
1 October to 31 December 20 January
1 January to 31 March 20 April
1 April to 30 June 20 July

In the Norwegian simplified registration system www.voesnorway.com, the supplier must submit a VAT return stating its identification number, the calculation basis and the calculated VAT translated into Norwegian kroner. The amounts must be rounded off to the nearest whole krone.

Bank details for making payments

Payee:

Skatte- og avgiftsregnskap
P.O.Box 38
4891 Grimstad
Norway

Bank:

DNB Bank ASA
SWIFT/BIC: DNBANOKK
IBAN: NO5876940518888

IMPORTANT: It is essential that you use your 7-character scheme identification number (issued at registration) as the payment reference. See reference: http://www.skatteetaten.no/en/voesnorway/Legal-Information/

What documentation and compliance requirements apply?

The merchant must keep a list of transactions that concern the sale of electronic services to Norwegian private individuals.

The list of transactions must be sufficiently detailed for it to be compared with the VAT return and thereby function as a means of control.

According to the Regulation to the VAT Act Section 15-10-1, the transaction record shall at least contain the following information:

  • Documentation reference
  • Delivery date
  • Name and residential address of customer
  • Currency
  • Fee, inclusive of value added tax, where the amount is given in Norwegian kroner, and
  • Value added tax.

The list of transactions must be stored for 5 years and, at the Norwegian tax authorities’ request, it must be made available electronically within three weeks.

As regards compliance with the regulations, merchants in the simplified registration system will be subject to most of the Value Added Tax Act’s general administrative provisions.

Among other things, this means that the merchants will have a general duty to disclose information that has a bearing on VAT control and that the VAT authorities can obtain information about the suppliers from third parties.

It also means that the VAT authorities can stipulate VAT by discretionary judgement and otherwise impose sanctions such as additional tax or penal sanctions if a supplier provides incorrect or incomplete information or fails to submit a VAT return.

What are the invoicing requirements for companies registered with Norway's VOES system?

Norway does not have any invoicing requirements for companies registered with VOES.

VOES-registered companies are only obliged to produce a sales list for their Norwegian B2C sales of e-services.

How are sales in foreign currencies treated?

If you sell to Norwegian customers in currencies other than Norwegian kroner (NOK), the amount needs to be stored in NOK as per the data requirements mentioned below.

A consideration that is stated in a foreign currency shall be converted into NOK at the rate of exchange on the date of supply stipulated pursuant to the Act on Customs Duties and Movement of Goods section 7-19 Regarding invoices, the VAT, if applicable, shall be specified in NOK.

Taxamo invoices will automatically calculate the values in NOK at the rate specified by the Norwegian tax authority.

How are adjustments and credit notes treated?

A merchant can make amendments via the simplified registration and reporting system to a previous VAT submission. This amendment can be positive or negative.

How long should data be retained for audit purposes?

Accounts books, vouchers, correspondence and other documents that can validate the bookkeeping, must be kept for at least 5 years after the end of the accounting year in question.