November is Half Tax Month
There are many things that are done to prepare for the Christmas season – even the government in Norway gets in on the action. One unusual tradition in Norway is the November tax break. All earnings in November are taxed half the regular amount. As most employers pay wages around the middle of the following month, it means the extra money in November comes in right before Christmas in December. So November is the time when employees make the most of their work hours and might even put in a little over time (very unusual!). The purpose of the tax break is to give Norwegians a Merrier Christmas and a Happier New Year.
Posted 27.11.2009 by
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My husband found your blog a few months ago and we have been reading it regularly. We both are involved in Norwegian heritage things here in the U.S. and we have friends and family living in Norway. We particularly love all the detail about life in Norway from the perspective of a foreigner in your blog. We have learned a ton. The photos, of course, are the best!
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from L-Jay:
Vær så god
Well, the tax in Norway is based on the annual earnings, and you have to pay the same tax if you earn it in November or any other month. It’s usual to pay half tax for your earnings in November, but you actually just pay more the other months. If you work a lot extra in November you might have to pay more tax to the government later, bacause you didn’t pay enough during the year.
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from L-Jay:
Everyone we know in Norway tries to work extra in November because most peoples pay/taxes are done monthly. This means you can work extra in November and not be affected. Those who are on a salary, it’s too bad, but most people in Norway are on wages.
It dosen’t matter if you are on wages, you pay tax after how much you made that year. You pay an amount of money in taxes during the year, and it will be corrected in the spring the nest year, and if you have payed to much or not enough in taxes the year before, you either have to pay the government or they will pay you back some money. You pay tax after every month, out from how much you made, and you usually pay half tax in desember (from what you earned in November), but that’s because you pay extra the other months. I know this 100% since I study a lot of economics and taxes in school. If the people you know work a lot in November bacause of this, they should read some more about it. It only gives them more money in Desember instead of June, when the tax corrections are out.
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from L-Jay:
I think you are missing the point – they might pay more or less tax when everything is evened out in Spring like you said for the previous year but thats ok isn’t it? The point is….
If you work in November you will get that extra money (because only half-tax taken out!) in December. You might pay the extra tax on it later – but for Christmas you have a little more extra cash in hand than usual. It’s like giving you the next months pay in advance so you can use it for Christmas. I’d say that’s not too bad.
I work and live in Norway. I worked hard November last year and had absolutely huge salary which I received in December. I did not pay extra tax the following year after assessment of taxes….and so on. I got some money back actually.
Can you tell me based on which law (rules) are we entitled to receive this ‘half tax ” ?
I have a problem with my employer-I get payed in November for what I am working in September, so in December for what I was working in November.Which payment should be taxed half???
Thanks a lot !
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from L-Jay:
You get half tax for all of November and then it is paid to you in December.
Thank you very much, L-Jay !
In the meaning time I’ve got the same answer from somebody working as “euro-adviser”.
Første posten på Reddit… Kommer bli noen besøk på denne siden tror jeg. God Jul :p
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from L-Jay:
Yes, our stat numbers have at least doubled (well, more like quadrupled by 100,000…lol)
Gul jul!
I just want to point out that Marius is right, there really is no “half tax” in December, it’s just that less taxes are deducted from your salary this month. This helps with liqiidity (i.e. you have more a higher amount of kroner to spend), but that is only because you have already had this portion of the taxes deducted from your salaries the rest of the year. It doesn’t matter if you are paid by the hour or not.
This means that if you have already paid the exact amount of taxes you should, during the rest of the year, you will have to pay “restskatt” the next year, which is you have to pay more taxes to cover the part not deducted from your salaries the previous year.
In my opinions this is one of the larger, collective “scams” in this country, because a lot of employers don’t know how this works either, and tell their worker that “Hey, you should work really hard and take all the extra shifts you can in November, cuz half tax is free money, right?” In reality, this mentality could really fuck up your taxes.
What Maria say happened to her, still happens a lot of the time. The most likely explanation is that she didn’t earn enough to put her in a negative “tax-state”, but she would have gotten more money returned to her if she had worked like normal.
All that being said, this is still a good idea, just not mistake it for actual “free money”.
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from L-Jay:
‘Half tax month’ is what Norwegians call November – it is not something I have made up. Of course, you will always pay the tax you are supposed to in a whole year – if you pay a little less in November you will pay a little more over the other months to even it out. But the fact still remains that because of the ‘half tax month’ Norwegians enjoy getting a little extra wage in December and that amounts to half the tax you would have normally paid for that month. It doesn’t matter that it has been taken off from the other months – they know it always evens out but just the fact that at a time when you want more of your wage, you get a little more for Christmas.
I have worked in Norway for many years and I enjoy getting more of my wage in time for Christmas. This is the time when I want more of my money than any other time of the year. Having it available is really nice. I know a lot of Norwegians who appreciate it (even the ones would don’t like socialism…lol). Who wouldn’t want access to more of their wage at Christmas?