Foreign Tax Relief in Norway: How to Claim Credits for Overseas Income

Norwegian residents earning income abroad often face the risk of double taxation. Fortunately, foreign tax relief in Norway allows taxpayers to claim credits for income tax paid overseas, reducing or eliminating the possibility of paying tax twice. This guide explains how the system works, eligibility rules, and how to maximize relief under Norway’s tax legislation in 2025 and 2026.

🌍 Why Foreign Tax Relief Matters

As a Norwegian tax resident, you are generally taxed on your worldwide income. If you also pay tax abroad on the same income, you risk being double taxed. To prevent this, Norway offers foreign tax credits and relies on tax treaties to provide relief. These rules apply to income from employment, pensions, capital gains, dividends, and more.

📌 Methods of Relief

There are two main ways double taxation is avoided:

• Credit Method: The most common approach in Norwegian treaties. You pay tax abroad, and the amount is credited against your Norwegian liability for the same income.
• Exemption Method: Less common but still applied in some treaties. The income is exempt from Norwegian taxation, though it may affect your tax rate through progression.

💡 Example of a Credit Calculation

Imagine you are a Norwegian resident working in the U.S. in 2025:

• Income earned: NOK 600,000
• Tax paid in the U.S.: NOK 120,000
• Norwegian tax due on that income: NOK 140,000

Norway will credit NOK 120,000 against your liability, so you only pay the difference of NOK 20,000 in Norway.

📑 Eligible Income Types

Income Source	Treatment under Norwegian Rules
Employment Income	Credit for foreign taxes if taxed abroad under treaty.
Pensions	Often taxable in Norway, but relief may apply if taxed abroad.
Dividends	Withholding tax abroad credited against Norwegian liability.
Capital Gains	Usually taxed in Norway; foreign tax paid may qualify for credit.
Interest	Foreign withholding may be credited; often limited by treaties.

⚖️ Limitations on Tax Credits

The foreign tax credit cannot exceed the Norwegian tax due on the same income. If foreign tax exceeds Norwegian tax, the excess may usually be carried forward for up to five years.

✅ Practical Tips for Claiming Relief

• Always keep foreign tax certificates and payment records.
• Use Skatteetaten’s electronic filing system to report foreign income accurately.
• Check whether a double tax treaty exists with the country where you earned the income.
• If no treaty exists, unilateral relief rules may still provide a credit.
• Consult a tax advisor for complex cases such as dual residency or mixed sources of income.