Norway Crypto Tax

Donations to charitable institutions provided the donation amounts to at least 500 NOK approx. 43 EUR per charity being pre-approved by the Norwegian tax authority; the upper ceiling being 25,000 NOK – approx. 2,000 EUR annually.

Corporate Income Tax

In Norway, the standard Corporate Income Tax rate amounts to 22%. The tax is levied on the income derived both in Norway and abroad by the Norwegian tax residents, while non-residents are obliged to pay tax on the income sourced as a result of business carried out in or from Norway. According to the law, any company incorporated according to Norwegian law is deemed a tax resident. However, if such a company is considered a tax resident in another country, it is not considered a tax resident in Norway. If the place of effective management of a foreign company is based in Norway, such a company is considered a tax resident in Norway.

The Corporate Income Tax is payable in advance in two instalments. The first payment falls due on the 15th of February and the second payment on the 15th of April. Normally, a tax assessment is issued during the month of October. Any final tax due has to be paid within three weeks from the issue of assessment. Any late or missed payments may entail enforcement fines.

Other crypto-related economic activities are taxed according to the general rules of Corporate Income Tax. Normally, trading in cryptocurrencies and various types of crypto-related products and services are treated as income and, therefore, should be included in annual tax returns. On the other hand, crypto mining is taxable if it requires investments in mining rigs and regular administrative activities. The value of the mined cryptocurrencies is considered income at market value in Norwegian kroner when it’s received. In another case, if the mining rig doesn’t require a follow-up of a continuous administrative nature, then, as a rule, this is not considered to be an economic activity.

Withholding Tax

In Norway, the withholding tax rate is normally 15%. The tax is intended to avoid and decrease profit-shifting to countries with low or without taxation and ensure fairer taxation in Norway. The rate is probably reduced under the rules for tax exemption or under the applicable double taxation treaty. The exemption is granted to those recipients of dividends who, as investors in corporate form, are residents in the EEA and can fulfill additional requirements.

In general, Withholding Tax may be deducted when a Norwegian company or branch pays interest, royalties, and lease payments to foreign companies in low-tax countries. The paying Norwegian company or branch is obliged to withhold, report, and remit the Withholding Tax to the tax authorities in Norway. If it fails to withhold enough tax from the tax-deductible payment, it will be subject to fines and other penalties.

Capital Gains Tax

The general capital gains tax rate in Norway is 22%, and it’s levied upon the income or gains of cryptocurrency dealing. Actually, that means selling some kind of cryptocurrency, exchanging, crypto mining, purchasing a product or service with it, and even NFT trading may be subject to taxation in Norway. Every citizen of the country has to report each transaction to the national tax authorities to avoid penalties or any other consequences provided by tax legislation.

It also provides that capital gains derived from crypto-related economic activities by enterprises constitute taxable income. Section 6-2 of the Norwegian Taxation Act provides that acquired losses because of the realization of a capital asset shall be deductible. Capital gains are calculated on the basis of the principle that acquisitions and sale prices must be established and documented uniformly and in a clear way. Acquisition costs for cryptocurrencies are all those related to buying, including any fees.

Wealth Tax

The Wealth Tax rate in Norway is 0.3% and is calculated for assets that exceed a net capital tax basis of 1.7 mill. NOK (approx. 150,000 EUR) for unmarried individuals and 3.4 mill. NOK (approx. 300,000 EUR) for married couples. In case the taxpayer is in possession of cryptocurrencies, they have to be declared in the tax returns for Wealth Tax purposes. Therefore, it would also be required to monitor the value of each dispersed crypto transaction, as well as regular trading.

Value-Added Tax

The standard VAT rate within Norway is 25%. It has to be determined and be collected from consumers and must be paid to the tax authority by any business with selling products and services in Norway. Companies should register at the Value Added Tax Register before triggering the first taxable event. The annual VAT returns are to be filed and paid on or before the 10th of March of the year succeeding the income year, whether or not any sales have been effected during that taxable period.

Although most crypto-related goods and services are subject to value-added taxation, such exchange of cryptocurrencies is exempt under sections 3-6 of the VAT Act in regard to financial services. This follows the decision of the CJEU that exchanging cryptocurrencies for fiat money constitutes a financial service and thus falls under exemption from VAT, similar to banknotes and coins legal tender.

Importantly, some crypto activities need to be assessed case by case for VAT purposes in view of the fact that there can be great variations of the same product or service type. For example, an Initial Coin Offering can be completely unique with different characteristics; thus, such would trigger different taxable events.

How do I pay taxes on crypto in Norway in 2024?

Taxation for income from the revenues of the cryptocurrencies in Norway is governed by the stipulations set forth by Skatteetaten in 2024. According to the Norwegian government, a cryptocurrency cannot be considered a legal means of payment but rather a means of investment that is subject to various tax implications for its investors and users.

Cryptocurrency Classification for Tax Purposes

In Norway, digital currencies are regarded as financial property; therefore, any income from the sale, exchange, or use of such property for payment against goods and services is considered a capital gain and is thus taxable. Additionally, if any interest or remuneration results from staking or mining activities, it becomes taxable as regular income.

Income Declaration

All cryptocurrency transactions must be recorded and reported in the annual tax return. Taxpayers are required to detail the date of the purchase and sale of the cryptocurrency, the purchase and selling prices, along with the overall profit or loss from each transaction.

Capital Gains Tax

Profits from the sale of cryptocurrency are subject to capital gains tax at the standard rate of approximately 22% in Norway for the tax year 2024. If the transaction generates losses, such losses can be deducted against the taxable income base of other capital investments.

Taxation of Mining and Staking Income

Income derived from mining or staking cryptocurrency is considered ordinary income and is taxed at the same rate as other forms of income. This includes rewards from mining and staking as well as interest on deposits in cryptocurrency.

VAT and Other Taxes

In Norway, no VAT is levied on the sale, purchase, exchange, or use of cryptocurrency for the consideration of goods and services. However, if goods and services are sold for cryptocurrency, their value must be included in the total VAT base at normal VAT rates.

Conclusion

Norwegian taxpayers involved in cryptocurrency transactions should carefully log and document all their transactions for reportable tax purposes. Occasional consultations with a tax expert or the use of professional cryptocurrency accounting tools would be beneficial to ensure that tax obligations are met and to optimize tax liability positions. It is imperative to note that the Norwegian government may update tax legislation in response to new developments in cryptocurrencies and various regulatory positions across multiple countries.

Table of Main Tax Rates in Norway

These rates reflect Norway’s tax policy in ensuring fair and sustainable financing of public services. It has a progressive personal income tax system, a competitive corporate tax rate, and a universal VAT system at different rates to incentivize certain sectors in the economy.

If you are determined to develop your crypto business in one of the most innovative and prosperous countries in the world, then the team of dedicated and quality-focused legal consultants here at Regulated United Europe (RUE) will be in a position to offer you tailored, value-added support related to the optimization of your taxes in full compliance with the applicable legislation. Besides that, we also provide full-service Norwegian crypto company formation, crypto licensing, and financial accounting. Feel free to contact us right now for personal consultations and set up for long-term success.

Also, lawyers operating under Regulated United Europe provide legal support for crypto projects and help with adaptation to MICA regulations.