VAT on services to and from abroad – how do you invoice correctly?

It depends on what kind of service it is, where the recipient is resident and who is buying. Where a Norwegian business buys a remotely deliverable service from abroad, the reverse charge normally applies: the buyer accounts for Norwegian VAT itself. Where a Norwegian business sells remotely deliverable services to a recipient outside the VAT area, the supply is zero-rated. Services tied to a place follow different rules.

What is a remotely deliverable service?

A remotely deliverable service is one that by its nature cannot, or can only with difficulty, be tied to a particular physical place. Typical examples are consultancy, IT services, software and SaaS, marketing, legal advice and many other professional services. What decides it is the nature of the service – not necessarily where the person doing the work sits.

When the business buys services from abroad

Where a Norwegian business buys a remotely deliverable service from abroad, the reverse charge normally applies. The foreign supplier does not then charge Norwegian VAT. Instead the Norwegian buyer has to calculate Norwegian VAT itself where the service would have been VAT-liable if sold in Norway. For most ordinary advisory, advertising and IT services the rate is 25%. Example: a Norwegian VAT-registered company buys a SaaS service for NOK 10,000. Where the service is covered and the rate is 25%, the company calculates NOK 2,500 of output VAT. Where it has a full right to deduct, it can claim the same NOK 2,500 as input VAT. The net VAT effect is nil, but the purchase and the VAT still have to be handled correctly in the reporting. That is not the same as leaving it unrecorded.

Businesses that are not VAT-registered can be caught too

The reverse charge can reach businesses that are not entered in the VAT Register. That matters particularly for businesses in areas such as health and finance, which can have turnover outside the scope of VAT while buying software, advice or other remotely deliverable services from abroad. For unregistered businesses and public bodies the duty to pay arises once such purchases together exceed NOK 2,000 excluding VAT in a three-month period. Since the business does not necessarily have a right to deduct, the Norwegian VAT then becomes a real cost – not a pass-through item.

Services tied to a place are treated differently

Not every service can be delivered remotely. Work on real property, certain event services and other services that by their nature are tied to a particular place are assessed under different rules. Where a foreign firm carries out VAT-liable work on a property in Norway, that firm can become liable to register and account for Norwegian VAT. So the customer should not automatically apply the reverse charge simply because the supplier is foreign. See also A foreign company setting up in Norway

When a private individual buys from abroad

On sales of remotely deliverable services from abroad to Norwegian private individuals, it is as a general rule the foreign supplier that has to calculate and pay Norwegian VAT, where the service would have been VAT-liable in Norway. That applies not only to streaming and other automated electronic services. From 1 January 2023 the rules were extended to remotely deliverable services generally. Foreign suppliers can use the simplified VOEC scheme, or register for VAT in the ordinary way.

When a Norwegian business sells abroad

Here the general rule is the opposite. Where the recipient is resident outside the Norwegian VAT area, the supply of remotely deliverable services is zero-rated for Norwegian VAT. That applies both where the customer is a foreign business and where the customer is a private individual. Zero-rating means the supply is covered by the VAT Act but no output VAT is charged – and the right to deduct on the cost side survives. See VAT deductions Different rules apply to services that are not remotely deliverable. They can, among other things, be zero-rated where the service is wholly for use outside the VAT area.

New from 1 July 2026: international businesses and branches

From 1 July 2026 the rules for international businesses changed. A company can now become liable for Norwegian VAT where a remotely deliverable service is bought by a part of the company abroad but used by a Norwegian branch or another Norwegian part of the same legal person. A software agreement entered into and invoiced to a foreign head office can therefore be caught where the service is actually used by the company's Norwegian branch. There are specific exceptions, including for services used entirely in activity that would have given a full right to deduct, and rules to prevent final double taxation where foreign VAT has already been charged. This is a recent change. Where the group has a Norwegian branch and centralised purchasing agreements, check the specific effect against the statute and the preparatory works before changing the routine.

Do not invoice with or without VAT automatically

On international sales of services, first establish what service is actually being supplied, whether it is remotely deliverable, where the recipient is resident, and whether the service would have been VAT-liable in Norway. A foreign customer does not automatically mean the invoice should carry no Norwegian VAT. Equally, a foreign supplier does not automatically mean the purchase falls outside the Norwegian VAT system. We help with the assessment, the bookkeeping and the reporting of VAT on services to and from abroad.

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.

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