Accounting for consultants and freelancers – what do you have to watch?

Start with the classification: are you an employee, a freelancer or self-employed? Under the presumption rule from 2024 the engager has to make it clearly more likely than not that it is a genuine engagement. Then the NOK 50,000 VAT threshold, income earned but not invoiced at the year end, the NOK 30,000 fixed asset threshold, and the rules for services to and from abroad.

Employee, freelancer or self-employed?

This is decided by how the arrangement actually works, not by what the contract is called or by your having an organisation number. From 1 January 2024 a presumption rule applies: an employment relationship is presumed unless the engager makes it clearly more likely than not that the engagement is genuinely self-employed. Pointing towards self-employment are responsibility for the result, a duty to put defects right at your own cost, your own equipment, independent organisation and real economic risk. The whole assessment is in Freelancer, contractor or employee? The burden therefore sits with the engager – and the assessment should be written down when the agreement is made.

Sole proprietorship or limited company?

For a consultant with low risk a sole proprietorship can be both cheap and practical, even at high turnover. A limited company becomes more relevant where the profit exceeds the private need, where capital is to be reinvested, or where you want to be a paid employee of your own business with the rights that brings. There is no turnover threshold at which a company suddenly becomes right – see Sole proprietorship or limited company

The VAT threshold

Ordinary consultancy services in Norway normally carry 25% VAT. The business registers once taxable turnover exceeds NOK 50,000 in a twelve-month period – a rolling period, not per calendar year. Keep the records from the start-up: VAT on costs from before registration can in many cases be recovered through a retrospective VAT settlement – see VAT registration

Earned but not invoiced

Work done in December can be December income even though the invoice goes out in January. For a consultant invoicing in arrears that is the most important year-end item, and the one most often missing. Fixed-price work has to be assessed on the contract – not with one universal percentage-complete formula. See Accruals

Bad debts

An unpaid invoice is not automatically a loss. To correct the VAT the debt has to be finally established as lost because of the customer's inability to pay – an unwillingness to pay or a contractual dispute is not enough. The conditions and documentation requirements are in Bad debts

Home office, computer and phone

Home office: the standard deduction in 2026 is NOK 2,240 a year, and the room normally has to be used exclusively for earning income. Where your own company rents a room from you, the tenancy has to be genuine – and it can affect a later sale of the home. See Home office Computers and equipment: the old NOK 15,000 threshold is gone. From 2024 the threshold is NOK 30,000. A depreciating asset under NOK 30,000, or with a useful life under three years, can normally be expensed directly – see Depreciation Phone and internet: in a sole proprietorship the business's relevant communication costs are expensed, while private use is handled through an income addition of up to NOK 4,392 under the current rules.

Cars, courses and entertaining

Cars: where you own the car privately and use it for work, the withholding-free mileage rate is NOK 3.50 per kilometre in 2026 – see Expense claims, subsistence and mileage. Where the company is to own it, the arithmetic is different – see Company car or private car Courses: maintaining existing expertise is treated differently from education giving new expertise. Entertaining: the general rule is that the cost is not deductible, and input VAT is blocked. A limited exception applies to simple refreshments where the conditions are met – check the current limit with Skatteetaten.

Consultancy to and from abroad

Where the recipient is resident outside the Norwegian VAT area, remotely deliverable consultancy is normally invoiced without Norwegian VAT. Where you buy services from abroad – software, advertising, advice – the reverse charge normally applies: you calculate the Norwegian VAT yourself. Where the business is not VAT-registered, the duty can still arise once such purchases exceed NOK 2,000 in a quarter. The whole picture is in VAT on services to and from abroad

Common mistakes

The classification is taken for granted because there is an organisation number. December work is invoiced in January and recognised in January. Unpaid invoices are written off without the conditions being met. The old NOK 15,000 threshold is applied to equipment. Foreign software purchases are booked without the reverse charge. Entertaining is booked with a VAT deduction. We can handle the accounts, the VAT and the accruals, and assess the tax side of the classification.

This is general guidance, not advice on your specific case. Deadlines, rates and amounts change – always check the current rules, or get in touch with us.

Is it urgent?

We can work out what actually has to be done, what documentation exists and how quickly it can be sorted. You can also reach us in the evenings and at weekends.

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