Transfer pricing in Norway at a glance
|Are there specific transfer pricing regulations?||Yes|
|Submission deadline upon request||45 days|
|Annual update required||Yes|
|Official language requirements||Norwegian, Swedish, Danish and English|
|Potential impact of penalties||Up to 30% of the tax adjustment|
Norwegian tax law
Rules for transfer pricing in Norway are based upon:
- General Tax Act section 13-1
Norway follows the OECD Transfer Pricing Guidelines.
Accepted methods are:
- the comparable uncontrolled price method
- the resale price method
- the cost plus method
- the profit split method
- the transactional net margin method
- other methods that provide an arm’s length result
Priority of methods
Rules for transfer pricing in Norway do not prescribe any priority of methods. However, the traditional methods are generally preferred over the transactional methods
- Key financial figures on all transaction parties to the Norwegian entity
- Description of how the transfer price on a transaction is actually computed
The level of detail required depends on the complexity of the transaction, and in particular, if the transaction is of high value, intangibles are involved, and/or there may be a tax motivation for pricing the transaction on non-arm’s length conditions.
Requirements to prepare documentation annually
Rules for transfer pricing in Norway prescribe that documentation should be prepared contemporaneously.
Submission deadline upon request by tax authorities
Rules for transfer pricing in Norway prescribe that documentation should be provided to the tax authorities 45 days after a request for documentation has been made.
Advance Pricing Agreements
Rules for transfer pricing in Norway generally do not provide Advance Pricing Agreements (APA) oppertunities, unless it is for the pricing of natural gas.
Rules for transfer pricing in Norway do not provide regulations for terms for natural gas APA’s.
The transfer pricing penalty, for failing to comply with the Norwegian transfer pricing documentation requirements, is 30% of the tax adjustments.