Does your company have sales of goods or digital services to Norwegian consumers? If the answer is yes, you may be required to register in Norway through the VOEC scheme. This system is not just a convenience - it is a legal obligation for foreign companies that meet certain criteria. The VOEC scheme simplifies VAT collection for low-value goods and remotely deliverable services, but it is essential to determine whether the company is required to register. Here is what you need to know.
What are low-value goods and remotely deliverable services?
Low-value goods are physical items with a value below NOK 3 000 (excluding shipping and insurance) sold to Norwegian customers. This includes products like clothing, electronics, houseware, and similar goods.
The VOEC scheme does not apply for the sale of food products, tobacco and alcohol as well as other goods that are restricted or prohibited according to Norwegian law, such as antiques, medicine and similar.
Remotely deliverable services are digital products or services that can be delivered electronically, such as software, streaming subscriptions, e-books, and online courses. Even though these services do not involve physical shipment, they still fall under the Norwegian VAT rules when the buyer is in Norway.
Under the VOEC scheme, foreign sellers must charge VAT when the customer purchases the goods and/or services.
Also read: VAT on e-commerce (VOEC) in Norway
Is your company required to register in the VOEC scheme?
It is mandatory for a foreign enterprise to register in the VOEC scheme when selling low-value goods or remotely deliverable services to Norwegian consumers. This legal requirement applies to companies whose total sales to Norway exceed NOK 50 000 in a 12-month period. Sellers of these goods and services can also choose to register in the VOEC system before they reach the threshold of NOK 50 000.
You have an obligation to evaluate your sales to Norwegian customers and determine if you meet this threshold. If so, you must register in the VOEC system and start collecting VAT from your Norwegian customers. Failure to comply with this obligation can result in penalties from the Norwegian tax authorities.
Intermediaries may be liable to register in the VOEC scheme if the intermediary is the deemed supplier of the goods or service.
This means that online marketplaces will be liable to register through the VOEC scheme when facilitating the distance sales of the low-value goods or remotely deliverable services with an electronic interface. The deemed supplier provision is mandatory, meaning the supplier and intermediary cannot choose who shall be VAT liable.
VOEC vs. Ordinary VAT registration
VOEC offers a simplified VAT registration and reporting process compared to Norway’s ordinary VAT registration. Here are the key differences:
VOEC registration
If the company meets the criteria, it is required to register under the VOEC scheme. This is only applicable to low-value goods and digital services sold directly to Norwegian consumers, and it removes the need for a local VAT representative. The VAT reporting is done with quarterly reports.
Ordinary VAT registration
For companies involved in a broader range of sales to Norway, ordinary VAT registration may apply, but it involves more detailed reporting and compliance with Norwegian tax and VAT laws. The VAT reporting is done with bimonthly reports.
The two registration methods are mutually exclusive, so a company can only be registered in one of the registration schemes. If you have the option to choose which registration scheme is most desirable, we recommend assessing the advantages and disadvantages of the two alternatives for your company in advance of submitting the registration application.
Also read: Should your business register for VAT in Norway?
How do you charge and pay VAT under VOEC?
Once registered in the VOEC scheme, your company will receive a unique VOEC identification number, which must be used when dealing with VAT-related matters in Norway.
You will be responsible for collecting Norwegian VAT (typically 25%) on all eligible sales at the time of purchase. This VAT is included in the price paid by the customer, ensuring they will not face additional fees when their goods arrive in Norway.
Registration will entail an obligation to file quarterly VAT returns and remit the VAT collected from the sales to the Norwegian tax authorities.
Shipping goods to Norway under VOEC: No customs duties
One significant benefit of the VOEC scheme is that it eliminates customs duties on low-value goods. Since VAT is collected at the point of sale, the shipments pass through Norwegian customs without additional fees or delays.
In contrast to standard registration, where certain goods such as textiles are subject to customs duties upon import, you gain a significant competitive advantage by using the VOEC scheme as long as each item in the shipment is valued below NOK 3 000.
For shipments that exceed this value, standard customs duties and procedures apply.
Why VOEC is essential for online suppliers
- Mandatory compliance: If your sales to Norway exceed NOK 50 000 within a 12-month period, you are legally required to register in the VOEC scheme. Failing to register can lead to penalties and disruptions in shipping.
- Simplified VAT compliance: VOEC registration is designed to simplify the process of VAT collection and reporting, removing the need for a local VAT representative in Norway.
- No customs duties on low-value goods: By collecting VAT upfront, you eliminate customs duties and ensure smooth delivery of low-value goods to your Norwegian customers.
- Broader market access: VOEC makes it easier for online suppliers to tap into the growing Norwegian market for sales of low-value goods and digital services.
Simplify your VAT compliance with VOEC scheme
If you are selling low-value goods or digital services to Norwegian consumers, the VOEC scheme is not only a legal requirement — it’s also a strategic advantage. By registering through VOEC, you can streamline your VAT compliance, avoid customs delays, and offer a smoother purchasing experience to your customers in Norway.
Is your business approaching or exceeding the NOK 50 000 threshold, then now is the time to act.
Need help navigating VAT compliance in Norway? Don’t hesitate to contact our team for guidance tailored to your company’s situation.