Payments in kind

‘Payments in kind’ are benefits an employee receives from their employer in any form other than money. They are sometimes also known as ‘perks’. The general rule is that all benefits that an employee receives are taxable.

Valuation of payments in kind

The employer must include the value of taxable payments in kind when calculating payroll withholding tax and employer's National Insurance contributions. It is not always easy to determine the value of a payment in kind. Normally, the sales value can be used. For practical reasons, alternative methods for determining the value of a benefit are given in some cases.

The Tax Act on payments in kind (in Norwegian only)

The Tax Regulations on payments in kind (in Norwegian only)

Payments in kind can be valued in one of three ways:

  • In accordance with a rate
  • Determination by the employer
  • The tax office's valuation

Examples of taxable payments in kind:

  • Free use of a car
  • Mobile telephone/internet
  • Free board and lodging
  • Private use of frequent flyer points and similar bonus points earned on job travels
  • Low-interest loans from an employer
  • Personal gym membership

Tax-ABC on private use of motor vehicle (in Norwegian only)

The Norwegian Tax Administration – Car rates – company cars

Tax-ABC on electronic communication (Ecom services) (in Norwegian only)

The Norwegian Tax Administration – Normal interest rate for the taxation of low-cost loans from an employer

The Norwegian Tax Administration on taxation of electronic communication services (telephone etc.) (in Norwegian only)

The Norwegian Tax Administration – board and lodging – rate for beneficial taxation (in Norwegian only)

Tax-ABC on gyms, health clubs etc. (Norwegian Tax Administration) (in Norwegian only)

The Norwegian Tax Administration – guide to reporting and taxing payments in kind (in Norwegian only)

Tax-ABC on payments in kind (in Norwegian only)

However, there are some exceptions for some types of payment in kind.

Some tax-free payments in kind


As a general rule, gifts to employees are taxable, but there are some exceptions:

  • Gift of up to NOK 8,000 for long service in the business. First applies after 20 years of service, and thereafter every ten years.
  • Gifts of up to NOK 4,000 can be given when: 
  • a) the recipient gets married
  • b) the recipient reaches the age of 50, and thereafter every ten years after that
  • c) the recipient retires or leaves for other reasons after at least ten years with the business 
  • d) the business reaches has been in existence for 25 years or a number of years which is divisible by 25, e.g. 50 years.
  • Gifts to employees of up to NOK 5,000 per year (e.g. Christmas presents). 

It is not permitted to give gifts in the form of cash. However, gift vouchers that cannot be exchanged for money will be acceptable.

Tax-ABC on gifts in employment arrangements (Norwegian Tax Administration) (in Norwegian only)

Staff discounts

Staff discounts, including a 100 percent discount, on goods and services produced or sold by the business are not taxable as long as the total discount per employee does not exceed NOK 8 000 per year. Discounts that an employee receives through the employer's suppliers must also be included in the overall discount. It is the turnover value in the end-user market that must be used as a basis when calculating the value of the discount.

When combining the rules for staff discounts and tax-free gifts, employers can provide payments in kind of up to NOK 13,000 per employee per year without triggering a tax obligation. Tax-free gifts can be added to this.

The difference between the rules of staff discount and the gift rule is that for gifts there is not a condition that the goods or services provided are sold by the company providing the gift.

Tax Act on staff discounts (in Norwegian only)

Tax-ABC on staff discounts (in Norwegian only)

Bank cards/credit cards

If an employee, when conducting business travels or for other purposes, needs a bank card or credit card, the employer can reimburse the annual fee without triggering any tax obligation.

Tax-ABC on bank cards (Norwegian Tax Administration) (in Norwegian only)

Reasonable welfare measures

Payments in kind which can be considered to be 'reasonable welfare measures' for all or a high proportion of the employees are not considered to constitute taxable income. An example of this could be a joint gathering with the aim of improving well-being at the workplace.

Tax-ABC on welfare measures (in Norwegian only)

Company holiday accommodation

If holiday accommodation is available to all employees or a significant group of employees, with equal entitlement for everyone to use it, this will normally be considered a tax-free benefit for the employees.

Tax-ABC on company holiday accommodation (Norwegian Tax Administration) (in Norwegian only)

Overtime subsistence

The employer can cover the cost of a meal tax-free up to a value of NOK 200 when the employee works continuously for at least 10 hours. This assumes that the employer buys the food, or that the employee documents the cost through receipts.

Board – Rate for food in connection with overtime work (overtime subsistence)

Free newspaper

Private access to newspapers or news services covered by the employer is not considered taxable for the employee if there is a professional need for such access is considered necessary because of their work.

Tax-ABC on free newspapers and news services (in Norwegian only)


No tax obligation will be triggered for an employee when their employer purchases, and requires an employee to wear, a uniform or special protective clothing.

Uniforms are characterised by a consistent appearance and a uniform-like style, often with a logo, and are unsuitable for private use.

Protective clothing is often used due to high levels of wear or dirt or for hygienic reasons. Examples of this include boiler suits at car repair workshops or overcoats in the health service.

Tax-ABC on work clothes (in Norwegian only)

Payments in kind and employer's National Insurance contributions

If a payment in kind is taxable for the recipient, the employer must calculate and pay employer's National Insurance contributions on the amount concerned. If a payment in kind is paid tax-free for the recipient, the employer will also not be required to pay employer's National Insurance contributions.

Salary reporting obligation (salary reporting)

All taxable payments in kind must be reported to the authorities via the a-melding. Payments in kind which are tax-free do not need to be reported.

Contact and help:

The Norwegian Tax Administration

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