Wealth tax and emigration – important clarification from the tax Appeal Committee

In case of emigration, a special issue arises because there may be a period from actual moving to the time the taxpayer has emigrated for tax purposes according to NTA section 2-1. Individuals who have lived in Norway more than 10 years will not be considered emigrated until 3 years have passed from moving. In addition, certain conditions need to be met. In each of the three years, the taxpayer may not be in Norway for more than 61 days in the fiscal year. In addition, the taxpayer cannot dispose of permanent housing in Norway. If these conditions are met for each of the three years, the residence will terminate at the “expiration of the third fiscal year” after the fiscal year in which the person moved from Norway. For example, if the taxpayer has lived in Norway more than 10 years and moves abroad 1 July 2021, he will first be considered emigrated at the end of 2024. However, he can be considered emigrated under applicable tax treaty earlier, but this does not have to be decisive for the wealth tax. If the tax treaty does not include wealth tax, the internal provisions apply.

According to the seventh paragraph of the NTA section 2-1, the obligation to pay wealth tax is conditional on the taxpayer living in Norway 1 January of the year the tax is determined. In the example above, the question will be whether the taxpayer should pay wealth tax for the last income year he is resident in Norway, i.e. the income year 2024.

In a recent decision, the Tax Appeals Committee has decided that wealth tax for the last income year in the 3 years period should not be paid if the condition in section 2-1 is met. This is because in such cases the tax payer will not be “resident” in Norway“ 1 January of the year in which the tax is determined”, i.e. 1. January 2025 in the example. Consequently, this means that he should not pay wealth tax for the “last” year of the 3-year “waiting period”.

Although this has not been disputed in parts of the academic community, there is now a legal clarification from the Tax Appeals Committee. Individuals who have moved out should therefore check whether wealth tax has been calculated for the last year of the 3 years period. If so, there may be necessary to amend the previous tax assessment under the rules on self-correction or requesting the tax office to make corrections.