If you’re a distance seller or online marketplace, then your business (or least its tax department) will need to have a firm understanding of Norway’s new VAT on e-commerce (VOEC) scheme in order to remain compliant in Norway. April 1st is around the corner and you’ll need to be paying the Norway tax man by then.
From 1 April 2020, all foreign sellers and online marketplaces will be obliged to declare and pay VAT on low-value goods (below NOK 3,000 per item, excluding shipping and insurance costs) sales to Norwegian consumers (B2C).
The new VOEC scheme applies to goods purchased on or after 1 April 2020. It will not apply to sales made earlier (unless VAT applies under existing rules) even if the goods do not reach Norway until after 1 April 2020.
What Should Your Business do to Ensure it’s VAT Compliant in Norway by April 1st
Step 1: Register for VAT
You need to register for VAT. We recommend you register with the VOEC scheme as it is easier than the Norwegian VAT register. Vatglobal is also able to provide you with assistance with registration.
According to the Norwegian VAT Authority website, the VOEC scheme will not be available if the goods’ value is at or above NOK 3,000 or are foodstuffs, restricted goods, and goods subject to excise duties. These goods will be subject to border collection of VAT, excise duties and customs duties. Carriers might also charge the consumer an additional fee for calculating and paying the duties.
Step 2: Charge Norwegian VAT
Your business will have to start charging the 25% Norwegian VAT to its customers on the point of sale.
Step 3: Ensuring Customs Clearance
To secure swift border crossing and avoid the risk of double taxation, the suppliers of VOEC-goods must ensure that relevant information about the parcel and its contents is available to the transporter and/or shipping agent and the Norwegian Customs. The relevant information is as follows:
- The supplier’s registration number (VOEC-number), which the supplier will get upon registration in the VOEC scheme. This unique number must accompany the shipment as described below.
- The contents of the parcel, including value, description and quantity of goods.
Step 4: Report and Pay VAT
Your business will need to report and pay VAT to the Norwegian VAT Authority on a quarterly basis. The quarters run according to an annual calendar and commences on the 1st Jan, 1st April, 1st July and 1st October))Authorities. The deadline for the submission of reports and payments is 20 days after the end of the quarter.
Vatglobal is able to offer assistance in both your VOEC Norwegian Registration as well as your reporting and filing of VAT.
VAT on Electronic Services in Norway
Suppliers of e-services are obligated to register for the simplified VAT scheme when the total value of services to recipients in Norway exceeds NOK 50 000 during a period of 12 months.
Norway defines e-services as the following:
- Capable of delivery from a remote location;
- Delivered over the internet or any other electronic network;
- Impossible to deliver in the absence of information technology; and
- Are of a nature which renders their supply essentially automated.
All the above requirements have to be fulfilled in order to be considered as e-services.
Are you already Registered for VOEC?
Foreign sellers and marketplaces that are registered in the VOEC scheme already can use their current registration to report and pay VAT on low-value goods. If you only sell electronic services and are registered in the VOEC register, you do not need to take any further action.