How to pay less taxes in Norway?
The income tax can be reduced by deducting mortgage interest (rente) from income.
It is not a secret that people who have mortgage can get a significant tax advantage by doing tax returns (selvangivelse). In this way, you can save several thousand of crowns and you will not need any intermediary agencies assistance.
All monthly interest payments paid during the year may be entered on your tax return sheet paragraph 3.3/4.8 Renter, gjeld, andre kapitalkostnader og fradrag. In this case, the tax relief reaches 28%. It means that over the period of one year can save you a couple thousand crowns. For many workers it is the maximal available tax deduction.
Usually, data about your payments is automatically transferred from your bank directly to the tax authorities (Skatteetaten). However, you should always double check whether the correct data has been entered. You are responsible for the data accuracy in the tax return declaration.
The correct and final amount may be found in the annual report – årsoppgave that bank sends you in the beginning of year. In årsoppgave, paragraph 3.3.1 you will find the total amount of paid interest (sum fradragsberettigede renter), and total loan amount (sum fradragsberettiget gjeld) that has to be equal to amount specified in paragraph 4.8.1 of the tax return.
What if there are two borrowers?
In this case, it is very often that tax authorities automatically enter the amount of the mortgage loan only from one borrower. If you are both listed as a bank loan payers, then both of you have the right to tax incentives.
Unmarried couples have to pay half (50 %) of the loan amount and part of the interest. Sometimes the tax authorities automatically add only one partner as the person responsible for the repayment of the loan. In this case, you should fix this 3.3.1/4.8.1 tax return paragraphs.
According to the law, married couple can share tax benefits with each other at any ratio / percentage.
Is this information how to reduce income tax in Norway useful? Leave a comment.