Trading in Norway

Trading in Norway

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This one's a bit out of my normal field ......

I have a client company who do specialist engineering consultancy work in the oil industry.

The company is considering doing a job in Norway for a French company.  If it takes the contract, they have been told that they'll need to register with the Norwegian tax authorities and pay some tax on the Norwegian profits.

Can anyone point me in the right direction here ?  I have to say that Norwegian isn't my best foreign language, to be honest, so some advice in English would be a help.

Also, the company isn't currently registered for VAT and is unlikely to cross the UK threshold of £81000.  Are there any VAT pitfalls ahead ?  I'm conscious that Norway isn't in the EU.

Replies (4)

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By Arniet
16th Jul 2014 21:27

Business in Norway

If they provide a service in Norway, they may have to pay norwegian MVA (eq. to VAT). The limit is 50 000 NOK, roughly 5K £ before they have to register.  If it is on norwegian oil installations/offshore there is an own set of rules/regultations.

If the service is provided from England to a company located in Norway, it will be treated as export from UK , and the receiving part in Norway will have to pay reversed-vat if the service is possible to deliver electronically. If you ship consultants to Norway, and they perform work in norway, you may have to register an NUF (http://www.brreg.no/english/forms/

This is not a complete answer, just some hints to point you in the right directions.  If there is some money at play, it could be wise to adwise your client to contact E&Y or some other company that have branches in both countries - they have the knowledge.

Sorry for the bad English - I'm Norwegian :-) 

Thanks (1)
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By Jim100
17th Jul 2014 00:22

permanent establishment

I think you need to check the DTA between UK and Norway to see if there is a permanent establishment in Norway.  I doubt there is a Permanent Establishment in Norway if it is just consultancy. Secondly, your consultants may have to pay taxes and social security depending if they are deemed to be resident in Norway. In my previous line of work as an accountant for a IT consultancy company, we worked in Norway for a couple of years and there was no PE. Though if you hired a flat for a consultant then that possibly could be deemed as a PE strangely enough.  VAT registration normally follow if there is PE but can recall some vague VAT rules that meant we needed to register and a VAT agent was required. I also recall there is a shortage of tax advisers in Norway and the ones available were so expensive.

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RLI
By lionofludesch
17th Jul 2014 13:48

Thanks to all

Please don't apologise for being Norwegian, Arniet - that's just what I need.

For the avoidance of doubt, the customer will definitely be French.

Thanks to all, including those who responded with pms.

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By refs8
17th Jul 2014 22:16

Strange because I have a client with a similar issue that hit my desk today. Interested to see where this goes.

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