Tax on Norwegian Pensions: What Retirees Need to Know

Retiring in Norway comes with many benefits, but also with tax responsibilities. Understanding how pensions are taxed in Norway helps retirees plan effectively, avoid surprises, and ensure they receive the maximum net benefit from their retirement income. This guide covers rates, deductions, and strategies for retirees in 2025 and beyond.

📌 How Are Pensions Taxed in Norway?

Pensions with a source in Norway are generally subject to a 15% withholding tax. However, tax treaties or EEA residency rules may reduce or exempt certain retirees from this rate. The taxation applies to:

• National Insurance Scheme pensions (folketrygden).
• Occupational pensions from Norwegian employers.
• Private pension savings drawn during retirement.

💰 Bracket Tax on Personal Income

In addition to the standard 22% general income tax, retirees may also be subject to bracket tax rates on personal income:

• 1.7% for NOK 217,400 – NOK 306,050
• 4.0% for NOK 306,051 – NOK 697,150
• 13.7% for NOK 697,151 – NOK 942,400
• 16.7% for NOK 942,401 – NOK 1,410,750
• 17.7% for income exceeding NOK 1,410,750

For many pensioners, income remains within the first two brackets, but those with additional earnings may fall into higher categories.

🧾 Deductions and Allowances for Pensioners

Retirees in Norway can reduce their tax burden through certain deductions:

• Personal Deduction (Personfradrag): NOK 108,550 in 2025, adjusted annually.
• Minimum Deduction (Minstefradrag): Covers typical living expenses; max NOK 92,200.
• Interest Expenses: Mortgage or loan interest payments are deductible.
• Union Dues and Pension Contributions: Deductible up to certain limits.
• Charitable Contributions: Up to NOK 25,000 annually.

Note that deductions are not available under the PAYE scheme, which applies mostly to non-resident retirees.

🌍 Special Rules for Non-Resident Retirees

Non-resident retirees receiving Norwegian pensions face a flat 15% withholding tax. However:

• EEA retirees may qualify for exemptions if they meet specific conditions.
• Tax treaties between Norway and other countries may reduce the rate or eliminate double taxation.
• Foreign pensioners may need to file to reclaim excess withholding tax.

⚠️ Common Mistakes Retirees Should Avoid

• Not reporting foreign pensions correctly when resident in Norway.
• Failing to apply treaty benefits, resulting in over-taxation.
• Assuming PAYE applies when filing is actually required.
• Missing the April 30 filing deadline for tax returns.

💡 Planning Tips for Pensioners

• Review your tax deduction card (skattekort) annually to ensure correct withholding.
• Consider timing pension withdrawals to remain in lower bracket tax levels.
• Leverage tax treaties if you have pensions from multiple countries.
• Consult a professional for strategies on coordinating pensions with other retirement income.