Norway can be found on the western portion of the Scandinavian Peninsula. It is the second least densely populated country in Europe. It has the forth highest per capital income in the world, the second highest in Europe. Norway has repeatedly had the highest human development index ranking in the world.
Norway is a founding member of the United Nations, NATO, the Council of Europe, the European Free Trade Association and the Nordic Council aswell as being a member of the European Economic Area, WTO and the OECD. Norway has twice voted not to join the European Union, despite this it does have close ties with the Union aswell as the United States. Norway being a member of the European Economic Area has access to the internal market of the Union providing that they implement Union legislation where it is deemed relevant.
Norway discovered oil and gas in adjacent waters and so has extensive reserves of petroleum and natural gas and is the world’s largest producer of oil and gas outside of the middle east. It has always been a shipping nation and has one of the largest fleets in the world. Its hydroelectric plants generate about 99% of its electric power, which is more than any other country in the world. Norway was the only western country to have a budget surplus after the crisis in 2008. It’s continued high ranking in surveys for wealth, quality of living and development means that it is viewed as one of the world’s most well functioning and stable countries.
If you are a citizen of an EU, EEA or EFTA country then you do not require a residence permit to live in Norway, but you will have to register yourself. Registration must be done with the Norwegian police if you plan on remaining in Norway for more than three months. You must have a basis for residency and will need to prove that you will not be a burden to the public welfare service. If you are not an EEA national you should apply for a residency card. Residency cards are free of charge and are indefinite so subsequently do not need to be renewed. If your application is denied you cannot appeal this decision, you may however register again at a later date providing that you meet all the necessary requirements and have the correct documentation. After five years EEA nationals can apply for a permanent right of residence and if not an EEA national you can apply after three years providing that you have completed tuition in the Norwegian language.
In January 2010 a new Immigration Act came into force in Norway to simplify registration procedures for EU, EEA and EFTA nationals and to make it easier for skilled workers from outside these areas to apply for employment. EEA nationals do not need a work permit to be employed in Norway. Skilled workers not from the EEA who wish to come to Norway before they have been granted a residence permit can apply for an entry visa. You should have a concrete offer of employment from an employer in Norway in order to do so. Whilst the entry visa does not allow you to work in Norway it does allow you to stay whilst your residence application is processed.
Getting to grips with the taxation system in a different country can be very daunting and Norway is certainly no exception with quite a complex taxation system but do not worry Chesterfield is here to assist.
Norwegian tax on ordinary income is 28% although for persons in the areas of Finnmark and Nord-Troms this is 24.5%. If you spend over one hundred and eighty three days in Norway you are classed as resident and have to pay tax on your worldwide income. If you do not reside in Norway for more than one hundred and eighty three days then you are not considered tax resident and only have to pay tax on income earned in Norway. Before starting work in Norway you must apply to your local tax office for a tax deduction card and this will be given to your employer. Every year you must do a tax return which needs to be filed by the 30 April. Aswell as income taxes there are a variety of other taxes that you might be subject to when working in Norway such as top tax which is charged at 9% on income between 490,000NOK and 796,400NOK and 12% on income above 796,400NOK. What you pay generally depends on your tax code and the minimum deductions. Married couples are usually taxed jointly, but can be taxed separately at the request of either spouse.
If you submit a form E101 from the national insurance department of your home country then neither you nor your employer will need to pay a national insurance contribution to Norway. If not however and you are working in Norway you will need to pay a contribution of 7.8% of your salary if you are an employee and 11% of if you are self-employed. Employers usually pay 14.1%, but this can differ depending on the area and branch. The minimum earnings used to calculate contributions for an employed person is 72,881 kroner. If you are self-employed the minimum earnings is 39,600 kroner.
If you are resident in Norway you are entitled to healthcare there is not a qualifying period, this includes free maternity services and hospital care. Employed and self-employed are compulsorily insured for sickness cash benefits.
Norway has an extensive social security system to which the rules are contained in the National Insurance Act 1997.
Norway is very keen to protect employees rights. Most employees in Norway are members of trade unions and most employers are members of employers associations. Collective agreements are regularly used to supplement statutory rules. The Employment Act of 17 June 2005 sets out the minimum requirements for all areas of the work environment. There are also various other legislation to protect things like equality, discrimination and other areas all with employee protection in mind.
Norway has trade unions that represent the employees and trade unions that represent the employers. Both are actively involved in the political and judicial issues. One of their main accomplishments is what is known as the ‘Main Agreement’ this is a general framework agreement which is used in the collective bargaining agreements and is so widely practised that it has been codified in legislation therefore binding the entire workforce.
Norway has rules to stop ‘social dumping’ this is where a foreigner is treated differently to Norwegian workers whether with less wages or worse working conditions. Citizens from EU countries are entitled to work in Norway with all the same benefits as a Norwegian worker so are non EU citizens who have a legitimate work permit to do so.
In order to open a bank account
you must have a Norwegian national identity number or a D-number. Banks in Norway do not generally use cheques. More and more banking in Norway is done online which can be quite daunting if you do not speak Norwegian.
Norges Bank is the central bank of Norway. It also manages The Government Pension Fund of Norway which is one of the world’s largest sovereign wealth funds. The bank has its own security force that is permanently armed with firearms.
In 1875 the monetary unit in Norway was changed to the krone. This was due to their entry into the Scandinavian Monetary Union and the need for a coin that would be a common Scandinavian coin which would be legal tender in the participating countries. The union ceased to be in 1914, but the currency remains.
Norway isn’t a European member so in order to protect its banks it operates a system whereby its banks are required to hold common equity Tier 1 capital of at least 9% of their risk-weighted assets. Some banks have above this and in light of recent global banking problems Norway is looking to increase this to further secure its banks.
We have a number of different Umbrella companies
to choose from depending on your own personal circumstances. The umbrella company essentially acts as an employer. There are various advantages to this including being able to offset certain expenses such as travel and meals. The umbrella company provides payroll services by billing the agency on behalf of the contractor and then distributing the salary back to the contractor.
Chesterfield are able to incorporate companies in a number of jurisdictions in order to suit your needs. It is more expensive to set up and maintain than our umbrella or self-employed schemes, but can have its advantages. For instance once the contract provider or agency has been invoiced for the work and this has been paid into the company bank account the contractor has a choice as to whether they would like to collect their money as dividends or as salary. If they were to choose dividends then in Norway there is no withholding tax on dividends if paid to an EEA resident shareholder and 25% if outside the EEA, but this can depend on whether there are any treaties in place. Individual shareholders resident in Norway for tax purposes are subject to the standard 28% income tax rate in Norway for dividend income exceeding a basic tax free allowance.
Chesterfield and contracting in Norway
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Chesterfield have years of experience with contractors working in other countries and a variety of schemes and solutions in order to make life easier. You will be given a dedicated member of staff who is responsible for all your administration and contact, allowing them to be more in tune with all your needs and assist you in every way possible.