From 1 January 2017 the reporting procedure for import VAT in Norway changes. Following our neighbours in Sweden and Denmark, Norway is introducing a reverse charge procedure. But are the importers prepared for the change?
The reverse charge procedure will be mandatory for importers that are registered for VAT in Norway. Non-registered and private importers will continue to pay VAT at the time of import.
The new procedure will have a positive cash flow impact for the importers, and we also believe it will be beneficial for businesses that VAT in the future will be handled by one, instead of two, authorities.
However, importers will also face some challenges, at least in the beginning. Currently the customs authorities calculate the import VAT, and the importers can use the monthly invoice from the authorities as basis for deduction of import VAT. In the new system, the importers themselves are given the responsibility to calculate the VAT. This means that they must have:
- Sufficient knowledge of the rules concerning customs valuation and import VAT calculation
- Necessary information to perform the actual calculation
The authorities will publish a monthly summary of import (and export) declarations on the tax reporting web-site Altinn. The summary will also include the declared value of the imported goods, and will be a useful tool in the process of calculating import VAT. Please note however that it does not take into account:
- Products with different VAT rates
- Products that are VAT zero-rated
- VAT on returned goods
- Specific products where the basis for calculating import VAT is not the customs value
Please also note that the quality of the import VAT calculation will rely on the quality of the customs clearance. If an incorrect value is used for the customs clearance, the import VAT will also become incorrect.
We recommend all importers to analyze their imports and VAT reporting procedures, to make sure the company is able to calculate and report import VAT from 1 January.
Mitt navn er Per Kirknes og jeg jobber som advokat i PwC. Mitt arbeidsfelt er merverdiavgift og toll, med særlig fokus på internasjonale forhold og cross border transactions. Jeg har arbeidet i PwC siden 2010, og har også erfaring fra tollmyndighetene.
My name is Per Kirknes, and I am an Attorney at Law working in the indirect tax team in PwC Oslo. I specialize in international trade with goods, including domestic and international VAT issues, as well as customs and excise duties. My work is often related to cross-border transactions, including structuring of supply chains and analyses of intra-group transactions. I also provide advice related to specific customs issues like valuation, origin, classification and customs procedures. I have been with PwC since 2010. Prior to that I worked ten years with development of the Norwegian customs legislation in the Directorate of Customs and Excise.