On 7 October 2020, the Norwegian Ministry of Finance announced the national budget for 2021 proposing 15% withholding tax on interest, royalties, and rent payments for certain physical assets paid by companies operating in Norway to related companies in low-tax countries.
The proposed withholding tax will apply on the payments from entities that are tax resident or otherwise liable to corporate tax in Norway to related parties that are tax resident in a tax heaven. A company will be regarded a “related party” if the payer and the recipient are directly or indirectly under the same ownership and control by at least 50%.
If passed, the effective date would be 1 July 2021.
