New tax scheme in Norway – PAYE
About the PAYE scheme Your income from employment is taxed at a rate of 25 percent. The rate includes national insurance contributions at 8.2 percent. Your employer deducts the tax directly from your salary and the deducted tax is the final payable tax. The 25 percent deduction is made from your gross earnings. It is not possible to claim any deductions under this scheme. There is no obligation to file a tax return and no tax settlement will be issued by the tax administration. The tax deducted by the employer is the final tax settlement. Who can choose to join the PAYE scheme The scheme is meant for foreign employees who work in Norway for short periods of time, and who are not tax residents in Norway. The scheme applies to most foreign workers the year in which they become tax residents in Norway. Persons living abroad and receive director’s fee or similar from a Norwegian company also fall under the PAYE scheme. You cannot join the PAYE scheme if your annual income exceeds the limit set out in the bracket tax step 3 (equal to NOK 617,500 for the income year 2019). You cannot join the PAYE scheme if you have taxable income from:- The Norwegian continental shelf
- Norwegian (NOR/NIS) ships abroad
- Real estate property or moveable property in Norway
- the Norwegian State
- business in Norway
- Gross wages
- Bonus
- Holiday pay
- Any other taxable benefits