Norway is one of the strongest economies in the world but has a population of just around 5 million. Yet it holds the 9th rank of the Ease of Doing Business List. The country’s stable government consistently introduces schemes and policies for smoother business. It also helps encourage entrepreneurial interests and enterprise-laced spirit in the country.
Norway leads in growth across tech, communications, innovation, maritime and energy sectors. No wonder close to 35,000 businesses start up annually in Norway. Over the last few years, businesses in Norway have also witnessed a reduction in their carbon footprint.
Establishing a proprietorship in Norway offers a suitable mode for expanding businesses globally. Check the process to register a sole proprietorship in Norway below.
Who can be a Sole Proprietor in Norway?
The rules around a sole proprietorship are more straightforward than those applicable to other business forms. Entrepreneurs, business owners, freelancers, residents, and non-residents can register a self-employed Norway business by following a simple set of rules.
- Nationality is not a constraint to establishing a sole proprietorship in Norway. However, foreigners must have a Norwegian address to register a self-employed Norway business.
- The main category to tick for opening a sole proprietorship in Norway is registering with the Company Registrar and the Tax Department.
Benefits of Sole Proprietorship in Norway
When you want to register a self-employed Norway business (known as enkeltpersonforetak), you get to enjoy several advantages-
- Sole proprietorships in Norway follow personal tax slabs.
- There is no difference between the business and the personal income of a proprietor.
- A sole proprietorship is considered an individual instead of a separate legal entity.
- Proprietorships in Norway do not need establishment via a fixed capital or shares.
- Auditing is not a compulsion when maintaining the administration of a proprietorship in Norway.
- The business culture in Norway is relaxed, and the hierarchical structure is flat. It gives businesses registered as sole proprietorships impetus to operate well.
- The government provides ample funds and innovative programs that act as support systems for sole proprietors in Norway.
- Even as a foreigner in Norway, doing business is seamless thanks to programs like Invest In Norway that help entrepreneurs establish their own companies.
- It is viable to register a self-employed Norway business. This is because the country has gender equality, least bias, good work-life balance, and encouragement for innovative business ideas.
Documents Required for Registering Your Business in Norway
Check the documents you require to register as a sole proprietor as follows-
- Business address
- Residential permit based on address
- Norwegian registration certificate from the Central Coordinating Register for Legal Entities. It involves no charges.
- Proof of age (must be a minimum of 18 years)
- Registration with the Register of Business Enterprises is the norm if the proprietorship hires above five employees and is engaged in the resale of goods bought. For this purpose, you must pay a fee of around NOK 2,250.
- Passport for proof of age and identity to register a self-employed Norway business.
Other Criteria for Registering a Sole Proprietorship in Norway
To begin work as a sole proprietor in Norway, you must ensure the following is in order-
- A local bank account
- Registered tax number
- Annual financial record for record purposes
- Foreigners can look up rules for getting a Norwegian permit on the UID or Norwegian Immigration site.
- Those above 15 can register a self-employed Norway business as a sole proprietorship with permission from the County Governor and guardian.
Post-registration compliances
- Ensure having an electronic signature in place to complete the application online.
- Foreigners need a local Norwegian ID and an address in the format of Street Name, Area Name, and district. A PO box is not considered valid.
- After company registration is complete, open a bank account with a bank in Norway.
- If you want to bring on any change in the business address, you need to make a new application.
Taxation
The main business and personal taxes for a sole proprietorship in Norway are listed below-
- Corporate tax
Norway’s Corporate Tax rate is 22%.
- VAT
A 25% VAT applies to goods and services in Norway. Two reduced VAT slabs are 11.1% and 15% for certain sectors.
- Personal income tax
- A flat rate of 22% applies to general income.
- For those living in Nord Troms and Finnmark, this rate stands at 18.5%.
- However, a further bracket tax is applicable on income at a progressive scale in Norway.
INCOME RANGE | TAX RATE |
NOK 190,350-NOK 279,150 | 1.7% |
NOK 279,150-NOK 644,700 | 4% |
NOK 644,700-NOK 969,200 | 13.4% |
NOK 969,200 and NOK 2 million | 16.5% |
Above NOK 2 million | 17.5% |
How to Register a Sole Proprietorship Company in Norway?
As a foreign entrepreneur, registering a sole proprietor in Norway is easy yet time-consuming. However, the right guide on how to register a sole proprietorship in Norway can help you sail through the process smoothly.
Step 1- Name selection
- Visit the website navnesok.no and enter the name for your sole proprietorship in Norway. See if the same is available.
- You need to register a domain name, enterprise name, and, finally, the trademark using the same name. The enterprise name and marketing name could be different.
- The former must have at least three Norwegian letters and never include a country or county name.
- The name must include the proprietor’s surname and business name. The latter can be descriptive or abstract.
Step 2- Registration
- Registration of any sole proprietorship in Norway is quick once the signed online application is submitted and the Registrar approves the same.
- The portal for the online application is the Bronnoysund Register Centre. You can view a list of forms here, which are all in Norwegian.
- Click on “Coordinated register notification – Registering a new entity or changing information regarding an existing entity.”
- To register with the Central Coordinating Register for Legal Entities, log in using your National ID number or Enterprise Name as available.
- Once the information regarding company type, activity, local business address, and age proof is updated, you need to sign the same digitally.
- The same person can sign the undertaking on your behalf if you have an accountant.
- Once the Register receives the submission, you will receive a notification with an Organization number.
- Track the status to see when the approval occurs.
Step 3- Banking account
- Next, apply to open an account at a local bank in Norway.
- Establishing an account for a sole proprietor in Norway requires certain documents. Those documents are the company registration number, enterprise name certificate, and a local address that doubles as a residence permit.
Conclusion
Multiplier is a reliable global employment solution that helps businesses to set up a company abroad. It steps in when you begin to register a self-employed Norway business. One must understand the registration formalities, rules, and compliances early. You can outsource the same to Multiplier to gain help with the sole proprietorship formation.
When you begin any business operations in Norway, Multiplier provides EOR solutions for easing all those recruitment and structuring worries. Businesses can negate the requirement of setting up a business but still enjoy the perks offered by the mentioned company type in more than 150 economies.