Norway will be launching a new, simplified and improved VAT return form. The new VAT return will be called the “Skattemelding for merverdiavgift” and comes into effect from 1 January 2017.
The reason for needing a new VAT return is that instead of paying import VAT to the customs authorities, from 1 January 2017 responsibility for import VAT will shift to taxpayers. The import VAT will be reported in the VAT return, hence the change to it.
The aim of this change is to enable importers of goods to declare and also recover import VAT on the same VAT return. Businesses will still need to complete the normal customs procedures but will not be required to actually pay import VAT at customs. This change will therefore have a positive cash flow effect for businesses.
However, while cash flow risk will be minimised, this simplification also means that all VAT liable businesses in Norway will need to update their VAT codes and ERP systems to manage the new method of accounting for the VAT. The change is not far away and hence steps should be started to be made now to complete these tasks in time.