Norwegian Tax
Administration
Guidelines to completition of form RF-1147 Deduction for tax paid abroad
by a person (credit) 2012
Adopted by the Directorate of Taxes
INTRODUCTION
The rules concerning credit for tax paid abroad
are set out in the Taxation Act section 16-20 ff,
and in the Ministry of Finance’s Regulations No
1158 of 19 November 1999 supplementing and
detailing the implementation etc. of the
Taxation Act section 16-28 relating to deduction
in Norwegian tax for tax paid abroad and the
duty to provide documentation. The rules also
apply to credit pursuant to a tax treaty. The
form does not apply to claims for credit
pursuant to the Taxation Act section 16-30.
Credit can be claimed by persons who are
deemed to be tax resident in Norway pursuant
to Norwegian domestic law and, if applicable,
pursuant to a tax treaty. If an income or capital
item from a foreign source is taxed both in
Norway and abroad, a deduction can be claimed
from the assessed Norwegian tax for the tax
paid abroad. When tax has been levied in a
country with which Norway has a tax treaty
and the income is covered by the treaty, credit
can only be granted when it follows from the tax
treaty that the income/ capital is taxable in that
other country and that Norway shall grant a
deduction from assessed tax in Norway for the
tax paid abroad.
Persons who, in addition to income covered by
the credit method, also have income covered by
the alternative exemption method and/or the
exemption method with progression, must
complete both form RF-1147 and form RF-1150
‘Nedsettelse av inntektsskatt på lønn’
(Reduction in income tax on pay – in Norwegian
only). The same applies to persons who, in
addition to income covered by the credit
method, have wage income earned during
periods of work abroad of more than 12 months’
duration and who are claiming a reduction in
tax.
The credit is limited to the lower of:
 the Norwegian tax calculated on the total
income abroad and/or capital abroad
(calculated maximum credit), and
 the amount actually paid in tax abroad for the
same income year as the income/capital is
taxable in Norway.
The credit shall be divided between the
following income categories:
- income from activities in low-tax countries, cf.
the Taxation Act section 10-63, and income
taxed under the provisions of the Taxation Act
sections 10-60 to 10-68,
- income from petroleum recovery abroad,
- other income from abroad.
Persons who have income in more than one
income category, must submit one form for
each category.
The credit for foreign withholding tax on
dividend, interest and royalties etc. is limited to
the amount of withholding tax that the source
country can levy pursuant to the tax treaty with
Norway. If the amount of withholding tax
withheld exceeds the amount that can be levied
RF-1148E
pursuant to the tax treaty, a refund of the
excess withholding tax must be applied for from
the country in which the payment was received.
Credit for foreign income tax is offset against
Norwegian tax on personal income and/or
general income depending on which tax basis the
foreign income is part of. Credit for wealth tax
paid abroad is offset against Norwegian wealth
tax. No credit is granted for National Insurance
contributions.
Credit is calculated automatically as part of the
tax assessment. Calculation of the maximum
credit requires income, expenses, capital and
debt to have been allocated between Norway
and abroad. This form is used to specify which
income and expenses in your tax return can be
allocated to abroad. This form is a mandatory
enclosure with your tax return if you are
claiming credit. Your personal allowance and
any tax deductions shall not be entered in this
form, but will be taken into account when your
maximum credit is calculated. Tax deductions
will be allocated between your income from
abroad and your other income in a manner that
reduces the maximum credit as little as possible.
Information relating to spouses
Spouses who both have income that falls under
the scope of the credit method must fill in and
submit separate RF-1147 forms. Spouses who
are assessed separately or jointly and whose tax
is allocated between them are considered
separately when the maximum credit is
calculated.
Information about business income
When specifying a sole proprietorship’s business
income from abroad in accordance with the
direct method, you must use form RF-1149
Næringsinntekt skattlagt i utlandet 2012 ( in
Norwegian only). See also the guidelines to item
2.5 and the guidelines included in the
supplementary form.
Partners in businesses assessed as partnerships
Businesses assessed as partnerships are obliged
to fill in and submit form RF-1145 ‘Fradrag for
skatt betalt i utlandet av selskap – kreditfradrag
2012 (Deduction from Norwegian tax for tax
paid abroad (credit) for limited liability
companies etc. and businesses assessed as
partnerships – in Norwegian only) together with
their partnership statement, and to inform each
individual partner about his/her share of the
company’s foreign income and capital. If the
partner is a natural person, he/she must claim
credit by filling in items 5.1 and 7.4 in the form.
See the guidelines to item 2.1 for more details
about a partner’s calculated personal income
and remuneration for work in a business assessed
as a partnership.
Documentation
If you are claiming credit, you must submit
documentation with your tax return to show
that the amount for which a deduction is
claimed:
 is foreign tax that is deductible from
Norwegian tax,
 has been paid abroad, and
 is the final tax resulting from the ordinary tax
assessment abroad.
The tax office can request more detailed
documentation of income, expenses and capital
abroad, including accounts for business
activities abroad. The tax office can also require
documentation to be submitted in a copy
confirmed by a notary public and/or together
with a translation into Norwegian by a
government authorised translator.
Conversion of foreign currency into Norwegian
kroner
All amounts entered in the form shall be stated
in Norwegian kroner (NOK). Income and capital
in foreign currency shall be converted into
Norwegian kroner before they are entered in the
tax return/income statement.
Persons who do not have a statutory obligation
to keep accounts can use the exchange rate on
the transaction date or an average exchange rate
for the year.
As a rule, those with a statutory obligation to
keep accounts shall convert their income and
expenses using the exchange rate on the
transaction date. They can choose to use
monthly average exchange rates instead insofar
as this is in accordance with Norwegian
accounting legislation.
The exchange rate as of 1 January in the year
following the income year shall be used to
convert the value of capital and debt.
If it is documented that a substantial part of the
income from abroad was exchanged at another
time and at a different rate than results from
conversion in accordance with the above rules,
the tax office may accept the use of a different
exchange rate.
Monthly and annual average exchange rates can
be found at www.norges-bank.no
Deadlines
If the right to credit cannot be substantiated
before the expiry of the deadline for submission
of the tax return in the year in which the income
and/or capital abroad is liable to tax in Norway,
the claim must be submitted no later than six
months after the final tax has been stipulated
abroad. A claim for deduction for tax abroad
cannot be filed later than 10 years after the end
of the year in which the income/capital abroad
was liable to tax in Norway.
Filling in the various fields in form
You provide the following information in the
fields in the form:
‘Amount’
- The amount of foreign tax, income
or capital.
’Currency’ - The foreign currency in question.
’Exchange rate’ - The exchange rate used for
conversion into Norwegian
kroner. When several amounts
have been converted together, the
date on which the conversion was
based shall be stated in the field
using one of the following letters:
- the letter T for the exchange rate
on the transaction date,
- the letter M for monthly average
exchange rates,
- the letter Å for the exchange rate
at year end, and
- the letter D if branch accounts are
kept in a foreign currency.
‘Which item’- The tax return/partnership
statement/income statement item
under which the
income/expense/debt was entered.
‘The amount in NOK’
- The amount of the
income/expenses/capital as stated
in the tax return/partnership
statement/income statement.
Use of information provided in RF-1147 by other
public agencies
In order to coordinate and simplify reporting
from business and industry, information
provided in this form can be used in whole or in
part by other public agencies authorised to
collect the same information, cf. the Act relating
to the Register of Reporting Obligations of
Enterprises sections 5 and 6. Information about
any such coordination can be obtained from the
Register of Reporting Obligations of Enterprises
by calling +47 75 00 75 00, or from the
Directorate of Taxes by calling 800 800 00.
Information about the use of plus and minus
signs in front of the figures in the form
The main rule
In principle, all figures shall be reported without
the use of signs if it is clear from the heading
whether they should be added or subtracted
given the context in which they are entered. In
other words, the figure should not be preceded
by a minus sign if the text states that the figure
concerns an expense, a deficit etc. and,
conversely, a plus sign should not be used where
the text states that the figure concerns income,
profit etc. An exception from this rule can be
illustrated by the following example:
During the income year, the letting of a
property has resulted in expenses that exceed
the income:
Income
Expenses
Loss
30,000
35,000
- 5,000
In order to transfer this loss of NOK 5,000 to an
item entitled ‘Income from letting’, it must be
preceded by a minus sign so that it can be
deducted – it is, after all, an expense (and not
income as the heading would indicate).
Specification
If a field contains a pre-printed sign (plus or
minus), the reported figure shall be written
without a preceding sign. A preceding sign shall
only be used for reporting amounts with the
opposite sign to the pre-printed one. In fields
showing totals and results, a minus sign shall
always be used when the sum total is negative.
I: CLAIM FOR DEDUCTION FOR
INCOME TAX PAID ABROAD
Income tax paid abroad and what parts of the
income and expenses entered in your tax return
and income statement can be allocated to
abroad is specified in Part I. By income from
abroad is meant income from a source abroad
that is liable to taxation in Norway pursuant to
Norwegian domestic law and any tax treaty,
and that is taxed abroad. Any income that is
exempt from Norwegian taxation pursuant to a
tax treaty because the exemption method is
applicable, shall not be included in the income
from abroad, even if the income is taxed abroad.
Item 1 Specification of income tax paid abroad
Here you specify the amount of income tax paid
abroad. (Wealth tax paid abroad is specified
under item 6 in Part II.)
Information shall be provided about what
country the tax was assessed in and paid to, the
types of income and tax concerned, the amount
of tax in foreign currency, the exchange rate
used for conversion into Norwegian kroner and
the amount of tax in Norwegian kroner. Details
regarding documentation of tax paid and
currency conversion are provided above.
Item 2 Income directly allocated to abroad
In principle, income items shall be attributed to
a source abroad in accordance with the so-called
direct allocation method, i.e. that income shall
be attributed to your income from abroad or
your Norwegian income according to where it
was earned. Income attributable to foreign
sources shall be entered under items 2.1-2.5.
Item 2.1 Calculated personal income and
remuneration for work relating to activities
abroad
Item 2.1.1 Calculated personal income from
businesses assessed as partnerships and sole
proprietorships
Here, you must enter that part of your
calculated personal income under item 1.6 in the
tax return that is attributable to abroad and has
been allocated to the owner of a sole
proprietorship.
For owners of sole proprietorships, calculated
personal income under item 1.23 in form RF1224 Personal income from sole proprietorship
2012 shall be divided proportionately between
income in Norway cfr. item 9930 in Income
statement 1 (RF-1175) or item 0999 in Income
statement 2 (RF-1167), and income abroad cfr.
item 4 in form RF-1149 Næringsinntekt
skattlagt i utlandet 2010 (Business income taxed
abroad in 2010 - in Norwegian only).
Item 2.1.2 Remuneration for work paid to
partners in businesses assessed as partnerships
Here you enter the share of the remuneration for
work, cfr. RF-1221 The partner statement to
partners in businesses assessed as partnerships
2012 item 1160 and 1162 that is to be allocated
to abroad. Remuneration for work must also be
entered under item 5.
Item 2.1.3.Total
The amount in item 2.1.3 is included in the
personal income to be allocated to abroad that
will be taken into consideration in the
calculation of the maximum credit for surtax.
Item 2.1.3 is not to be added together with the
items below.
Item 2.2 Income from employment etc. earned
abroad
Item 2.2.1 Pay etc.
Here you enter pay, fees, payment in kind and
other forms of remuneration received for work
carried out abroad that is entered under item 2.1
in the tax return and that is covered by the
credit method.
Item 2.2.2 Pensions etc.
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Here you enter gross pension income and
National Insurance benefits from abroad that
are included under item 2.2 of the tax return.
Item 2.3 Maintenance payments received etc.
Here you enter maintenance payments received
and non-employment-related annuities etc.
entered under item 2.6 of the tax return. Any
back payments of pay and pension shall be
entered in items 2.2.1 and 2.2.2 of the form.
Item 2.4 Other income from abroad
Item 2.4.1 Share dividends
Here you enter share dividends from foreign
companies that are entered under item 3.1.7 in
the tax return. Dividends for which a risk-free
return is granted shall be entered as the gross
dividend.
Item 2.4.2 Other capital income
Here you enter, e.g., taxable gains from the
realisation of shares in foreign companies, the
letting of real property abroad, gains from the
realisation of housing and holiday properties
abroad etc. Specify what the income concerns,
and in which item in the tax return the income
has been entered.
Item 2.5 Business income/ loss from selfemployment
Here you enter business income/ loss from selfemployment that can be allocated to abroad,
transferred from item 4 in ”Næringsinntekt
skattlagt i utlandet" (RF-1149 – Business
income taxed abroad – in Norwegian only). If
there is more than one business income, each one
must be entered separately in item 2.5.
Item 3 Costs directly attributable to income
entered under item 2
Costs directly attributable to income earned
abroad are entered under items 3.1 and 3.2. This
is called the direct allocation method. That a
cost is directly attributable to an income item
means that the cost has been necessary in order
to obtain the income. Such costs shall be
deducted from the income from abroad.
If the cost is directly related to income both in
Norway and abroad, the deduction shall be
divided proportionately between the income
from abroad and the income in Norway, see
guidelines to item 3.1. For other costs, for
example additional costs of living away from
home, it must be assessed whether they are
related to the income from abroad, the income in
Norway or the total income. If the cost is not
directly related to your income in Norway or
abroad, it shall be divided proportionately
between the net income in Norway and abroad,
see the guidelines to item 4.
Item 3.1 Minimum standard deduction
The purpose of this item is to establish how
much of the minimum standard deduction is to
be deducted from the income from abroad.
In principle, the minimum standard deduction
shall be divided proportionately between income
from abroad and income in Norway. Exceptions
apply to pay and pensions from other EEA
states, see below. The minimum standard
deduction is found in item 3.2.1 of your tax
return.
The amount is arrived at by multiplying the
minimum standard deduction by the income
from abroad in item 2.2.3 of the form, and
dividing this by the sum total of tax return
items 2.1, 2.2, 2.6.1 and 2.6.3. Remember that
any corrections to the tax return must be done
before the calculations under item 3.1 are carried
out.
Pay and pension etc. for which a minimum
standard deduction is granted pursuant to the
Taxation Act 6-31, and which was earned in
other EEA states, are treated in the same way as
Norwegian income. Such income must therefore
be deducted from the amount in item 2.2.3 when
calculating the share of the minimum standard
deduction to be deducted from the income from
abroad. If 90 per cent or more of your pay or
pension is earned in one other EEA state, the
amount must be included under item 2.2.3 in its
entirety. The same applies when the income was
earned in a country outside the EEA area.
Item 3.2 Other costs
In this item you enter other costs directly
attributable to your income from abroad. Such
costs include actual job-related expenses,
expenses relating to travel to/from work,
additional costs of living away from home,
including travel in connection with home visits,
occupational pension insurance premiums, union
dues and seafarers' allowances. Special
allowances for disability pursuant to the
Taxation Act section 6-81 first and second
paragraphs shall be attributed to the income
from abroad in their entirety if the disability
pension is paid from abroad. Special allowances
relating to a Norwegian disability pension shall
not be entered in the form. State the type of cost
concerned and under which item in your tax
return the cost has been entered.
If a standard deduction for foreign employees is
claimed (item 3.3.7 on the tax return), this
deduction shall be allocated proportionately to
wage earnings abroad and wage earnings in
Norway. This is calculated by multiplying the
standard deduction amount by the wage
earnings earned abroad and dividing the result
by the total wage earnings (the sum total of pay
in Norway and abroad) as shown below:
standard deduction x wage earnings abroad
total wage earnings
When a standard deduction is claimed, most
other deductions except for the minimum
standard deduction will not apply. The
deductions that do not apply shall not be
included in this form.
From and including the income year 2008, a
person who is self-employed or engaged in
business in another EEA state can allocate
interest expenses using the direct method,
provided that the interest expenses relate
exclusively to either activity in Norway or the
enterprise’s activity in the EEA state.
A loss carryforward from self-employment etc.
shall be allocated using the direct allocation
method and allocated to abroad if the loss
lawfully arose there.
Item 3.3 Net income abroad before deduction of
costs that cannot be attributed to a specific
income
The amount in item 3.3 is the net income to be
used as the basis for the allocation of costs that
cannot be allocated to a specific income in item
4.
Item 4 Costs that cannot be attributed to a
specific income
If the cost cannot be attributed to a specific
income, the deduction must be divided
proportionately between the net income in
Norway and abroad.
This is calculated by multiplying the cost by the
total net income in item 3.3 of the form and
dividing by the corrected net income.
Cost x item 3.3 in the form
Corrected net income
The corrected net income is determined on the
basis of the amount 'total basis for income tax'
from the tax return. This is your net income. If
you have made corrections to your tax return,
you must use the net income after corrections as
the basis. The net income must also include the
income abroad.
The net income must then be corrected. This is
done by attributing all costs that cannot be
attributed to a specific income to the net
income.
Example:
Payments made into individual pension
agreements is an example of a cost that cannot
be attributed to a specific income, and they shall
therefore be divided proportionately between
the net income in Norway and the net income
abroad. If the payment is NOK 30,000, the net
income abroad is NOK 100,000 (item 3.3 in the
form) and the Norwegian income is NOK
150,000, i.e. a net income of NOK 250,000, the
following calculation will be made in the form:
Corrected net income: 250,000 + 30,000 =
280,000
Allocation of payment into an individual
pension agreement: 30,000 x 100,000
280,000
The result is NOK 10,714. This amount is to be
entered under item 4.2.
If the corrected net income is negative or smaller
than the income abroad, for example the
Norwegian income is negative (a deficit), all
costs shall be attributed to the income from
abroad.
The tax office can permit the use of other
allocation ratios in exceptional cases for costs
other than interest on debt. In such cases,
documentation must be enclosed to show that
using a different allocation ratio will produce a
reasonable result in accordance with generally
accepted commercial and business economy
principles, and that this allocation ratio is used
consistently.
Item 4.1 Interest expenses
Here, you enter the allocation of interest
expenses. Interest on debt that is deductible in
Norway shall be allocated to Norway or to
abroad in proportion to where the net income
has been allocated; see, however, the exception
below concerning pay and pension from abroad
that is to be treated in the same way as
Norwegian income when the interest expenses
are allocated. See also the exception for interest
expenses that relate to either an enterprise in
Norway or in another EEA state as described
under item 3.2.
Married couples can choose which spouse will
claim a deduction for interest expenses. The
allocation of interest expenses between spouses
can in some cases have a bearing on the
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calculation of the maximum credit when only
one spouse claims a credit.
The total of the amounts in items 3.3.1 and 3.3.2
in the tax return constitutes the total interest
expenses. These expenses are multiplied by item
3.3 in the form and divided by the corrected net
income. (See, however, the exception below
concerning income from employment and
pension.)
Cost x item 3.3 in the form
Corrected net income
Exception: when interest on debt is allocated,
income from employment or pension earned
abroad shall be treated in the same way as
Norwegian income. This means that, in such
cases, the net income from abroad in item 3.3 in
the form shall be reduced by the income from
employment and pension. The same applies to
unit owners' shares of the costs in housing
cooperatives, cf. the Taxation Act section 7-3
fifth paragraph b.
Item 4.2 Other costs
Here, you enter other costs than interest on debt
that cannot be attributed to a specific income,
such as payments made into individual pension
agreements, child-care deductions, maintenance
payments, special allowances for major sickness
expenses or contributions to research.
State the expense concerned and under which
item in your tax return the expense has been
entered. These expenses shall be divided
proportionately between the net income in
Norway and abroad, (See, however, the
exception below.)
Cost x item 3.3 in the form
Corrected net income
If another allocation ratio is used, this must be
stated in the form, and such documentation as
mentioned in the guidelines to item 4 must be
enclosed.
Exception: if pay, pension or income from an
enterprise come from other EEA states, the
following deductions shall be made from the
amount in item 3.3 of the form in connection
with allocation: child-care deductions,
maintenance payments and special allowances
for minor impairment of earning capacity and
major sickness expenses. This shall not apply,
however, in cases in which 90 per cent or more of
pay and pensions come from one other EEA
state.
As regards unit owners' share of costs in housing
cooperatives, see the last paragraph of the
guidelines to item 4.1 of the form.
Item 5 Share of business income/loss from
businesses assessed as partnerships
Here, partners in businesses assessed as
partnerships enter their share of the enterprise's
business income or loss that can be allocated to
abroad. The enterprise can provide information
about the amount.
The share of the remuneration for work that can
be attributed to abroad is also to be entered
here.
II CLAIM FOR DEDUCTION FOR
WEALTH TAX PAID ABROAD
In Part II, you specify wealth tax paid abroad
and what parts of the capital and debt entered
in your tax return/income statement are in or
are attributable to abroad. By capital abroad is
meant assets abroad that are liable to taxation
in Norway pursuant to Norwegian domestic law
and any applicable tax treaties, and that are
taxed abroad. Assets abroad are valued in the
same manner as assets in Norway. Capital
exempted from Norwegian taxation because the
exemption method is applicable, shall not be
included in the capital abroad, even if the
capital is taxed abroad.
The amount in aggregate item 7.2 shall be used
as the basis for the allocation of debt in item 7.3.
Item 6 Specification of wealth tax paid abroad
Here, you specify the amount of wealth tax paid
abroad. (Income tax paid abroad should be
specified under item 1 in Part I.)
Information must be provided about what
country the tax was assessed in and paid to, the
type of asset and tax, the amount of tax in
foreign currency, the currency, the exchange
rate used for conversion into Norwegian kroner
and the amount of tax in Norwegian kroner.
Details regarding documentation of tax paid and
currency conversion are provided in the
introduction below.
The debt is multiplied by the net capital abroad
in aggregate item 7.2 of the form and divided by
the total gross capital from the tax return after
any corrections.
Item 7 Capital and debt abroad
Item 7.1 Capital taxed abroad
Here you enter capital taxed abroad and entered
under item 4.6 in your tax return.
Item 7.2 Aggregate item
Item 7.3 Debt
All debt entered under item 4.8 in the tax
return is to be entered under this item. The debt
shall be divided proportionately between capital
abroad and capital in Norway.
Item 7.4 Partners' share of capital/debt in
businesses assessed as partnerships
Here, partners in businesses assessed as
partnerships enter their share of the enterprise's
capital or debt that can be allocated to abroad.
The enterprise can provide information about
the amount.
III CREDIT CARRYFORWARD OR
CARRY-BACK
Item 8 Credit carry-forward
When the credit cannot be deducted in full in
this years’ tax settlement, it can be carried
forward for deduction from tax for up to five
subsequent years within each income category.
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Tax paid abroad in a previous year will be
deducted in full before deductions are granted
for tax paid abroad in a subsequent year. Tax
paid abroad in the year in question is to be
deducted before deduction for tax paid abroad in
a previous year.
The total deduction for each year within each
income category cannot exceed the maximum
credit for the year in question.
Item 9 Credit carry-back
A right to carry back unused credit was
introduced from the income year 2008, cf. the
Taxation Act section 16-22 second paragraph.
This means that tax paid abroad that does not
qualify for a deduction in this year’s tax
settlement can be carried back and deducted
from tax for the previous year within each of the
income categories in section 16-21 first
paragraph a-c. The total deduction for the
previous year within each income category
cannot exceed the maximum credit for the year
in question. Such carry-backs are contingent on
the taxpayer being able to substantiate that
he/she will not become liable to tax in Norway
for such income from a source abroad during the
next five years.