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Fund Taxation Alert 2018-07

Fund Taxation Alert 2018-07



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Online Filing and 0% Tax Card

Launch of online tax filing system

In 2017, the Norwegian tax authorities (COFTA) introduced ‘Altinn’, a new web portal designed to enable electronic filing and exchange between tax payers and the tax administration. The use of this portal is COFTA’s and KPMG’s preferred method for filing withholding tax reclaims. Upon submission, a tracking reference for the claim will be issued. However, since the process is web-based, KPMG will continue to require hard copies of documents in order to be able to perform a reliable filing and provide original documentation if requested by the tax authorities.

Relief at source — securities account with reduced or 0% tax rate

Shareholders may obtain securities accounts with a reduced or 0% tax rate. To benefit from such accounts, the shareholders should either submit to the VPS account operator/custodian a refund decision from the prior years or obtain an advanced approval from COFTA. Other documents such as a certificate of residence (COTR) and a statement that the recipient of the dividends is the beneficial owner must be provided and renewed every three years.

Application for advanced approval from COFTA

To obtain advanced approval, shareholders should file an application containing key elements such as:

  • Documentation that the conditions are met to benefit from a reduced or 0% tax rate
  • Full name and address of the beneficial owner
  • For application under a Double Tax treaty (DTT) , a COTR issued by the tax authorities of the country of which the shareholders claim to be resident with reference to the DTT with Norway; certificate to be issued within six months prior to the application
  • For application under the Norwegian exemption method, a detailed description of the foreign entity's legal structure, comparability analysis and COTR to be provided.

Updated obligations for existing nominee account operators

Entities allowed to hold nominee accounts with a reduced or 0% tax rate will have to renew this authorization by filing a new application with COFTA as existing accounts were discontinued as of 1 January 2018. In the absence of a renewed application, each VPS account shall be considered as a 25% withholding tax account.

KPMG recommendation

To ensure a beneficial taxation of your investment funds in Norway, the relief at source documentation should be reviewed and updated if relevant. KPMG can help put the necessary procedures in place.

Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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