Inheritance and Estate Tax in Norway

Did Norway ever have an inheritance tax and when was it abolished?

Norway levied inheritance and gift tax (arveavgift) for decades under the Arveavgiftsloven. The Norwegian Parliament (Storting) voted to repeal that law entirely, and the repeal took effect on 1 January 2014. Any inheritance where the death occurred on or after that date, and any gift made on or after that date, is free of inheritance and gift tax. Estates where death occurred in 2013 or earlier remain subject to the old rules, which imposed rates of up to 15 percent on inheritances to close family and up to 20 percent for more distant recipients above certain thresholds. Since 2014, no notification to the tax authorities is required for inheritances or gifts received, and no Norwegian inheritance or estate tax return must be filed for transfers in scope of the repeal. Skatteetaten (the Norwegian Tax Administration) confirms this position on its official guidance page [1].

What is the continuity principle (kontinuitetsprinsippet) and how does it affect heirs?

Because abolishing inheritance tax removed the mechanism that used to reset the tax basis of inherited assets to market value, the legislature introduced the continuity principle as a replacement. Under this rule, confirmed by Skatteetaten [2], the heir or gift recipient takes over the deceased person's or donor's original acquisition cost (input value) for the transferred asset. The heir does not receive a stepped-up basis. Instead, any capital gain that accumulated while the deceased held the asset passes silently to the heir, to be taxed when the heir later disposes of the asset.

Example: a parent bought shares in 1995 for NOK 200,000. At the time of death in 2025 those shares are worth NOK 2,000,000. Under the continuity principle the heir inherits the original NOK 200,000 basis. If the heir sells the shares five years later for NOK 2,500,000 the taxable gain is NOK 2,300,000, not merely NOK 500,000. Norway's standard capital-gains rate on share income under the shareholder model (aksjonormodellen) is 22 percent of income grossed up by a factor of 1.72, giving an effective rate of approximately 37.84 percent on the full gain from the original basis.

This design means the abolition of inheritance tax did not eliminate the tax on inherited wealth. It deferred it, shifting the liability from the event of inheritance to the event of future sale. Families holding highly appreciated assets -- farms, shares in closely held companies, investment properties -- carry the largest latent exposure.

Exception for primary residence and holiday homes. The continuity principle contains an important carve-out for residential and holiday property that the deceased could have sold tax-free immediately before death [1][2]. Under Norwegian law an owner who has lived in a home for at least 12 of the last 24 months can sell it tax-free. If the deceased met that test, the heir's input value is set to the market value at the date of acquisition by the heir (i.e., stepped up), not carried over from the deceased's original purchase price. For farms and forestry the step-up is capped at three-quarters of estimated sales value. This carve-out prevents heirs from inheriting a large tax liability on a family home the deceased could always have sold without tax.

Is gift tax also abolished in Norway?

Yes. Gift tax was repealed alongside inheritance tax on 1 January 2014. There is no Norwegian gift tax, no annual gift exemption limit, and no requirement to notify Skatteetaten about gifts received after 31 December 2013. Gifts given before that date must still be reported if a notification has not yet been submitted. The continuity principle applies equally to lifetime gifts: the recipient takes over the donor's original acquisition cost, so the latent capital gain transfers to the recipient and is taxed on future disposal [1].

This means Norwegian residents can transfer large amounts of money, property, or shares to family members during their lifetime with no immediate tax cost. There is no equivalent of the UK's seven-year potentially exempt transfer rule, no German ten-year aggregation window, and no Swedish restriction. That said, a gift made shortly before a donor emigrates from Norway can interact with exit tax rules if it involves substantial shareholdings.

What wealth tax applies to an heir's inherited assets?

Although there is no inheritance event tax, heirs who accumulate net assets above the threshold become liable to Norway's annual wealth tax (formuesskatt). For the 2026 tax year, based on data published by Skatteetaten [3], the combined municipal and state wealth tax rates and thresholds are:

For married couples and registered partners assessed jointly the thresholds double (NOK 3,800,000 at the lower band). Taxable wealth is not the full market value of all assets: Skatteetaten applies valuation discounts to unlisted shares, operating assets, and certain primary residential property, which can meaningfully reduce the wealth tax base below gross market value.

The practical effect: an heir who inherits a share portfolio worth NOK 5,000,000 will pay approximately NOK 31,000 per year in wealth tax on that portfolio (rough estimate at the combined 1.00 percent rate on the amount above the single-taxpayer threshold). Over a decade of holding, wealth tax alone represents a significant cost on top of the latent capital-gains liability that will crystallise on sale.

Is there political debate about reintroducing inheritance tax in Norway?

Yes -- this is an active and unresolved political debate. The current position is that Norway has no inheritance or gift tax and no legislation to reintroduce one is in force. However, left-of-centre parties including the Red Party (Rodt) have proposed a new inheritance tax with a basic deduction of NOK 5,000,000 and progressive rates above that threshold. Following the 2021 election the Stoere government commissioned a formal tax commission (skatteutvalget) to review the Norwegian tax system. That commission has been tasked with delivering recommendations by 1 July 2026. Reintroduction of inheritance tax -- potentially combined with reductions in wealth tax -- is among the issues the commission is examining. No legislation has been tabled in the Storting as of the date of this review, and any proposal that emerges from the commission would still require a parliamentary majority to become law [4]. This remains a proposed policy direction under deliberation, not enacted law.

For individuals managing significant asset transfers in Norway, developments from the tax commission are worth monitoring. Consult a Norway country overview for broader jurisdiction context and speak with a qualified tax professional about timing of any planned intergenerational transfers in light of this ongoing debate.

What are the practical steps for an heir in Norway today?

For deaths occurring on or after 1 January 2014, no inheritance tax return is filed and no notification is sent to Skatteetaten solely because of the inheritance. The heir should:

1. Record the deceased's original acquisition cost for each inherited asset, since that cost becomes the heir's basis under the continuity principle.
2. Check whether any residential property meets the primary-residence criteria for a stepped-up basis.
3. Include newly inherited assets in the heir's annual wealth tax return if total net assets exceed the threshold.
4. Report inherited real property and other assets exceeding NOK 100,000 in value in the year-end tax return as instructed by Skatteetaten [5].

The absence of an inheritance tax return does not mean no ongoing tax obligations arise from an inheritance. The latent capital-gains position and the annual wealth tax exposure together make professional review worthwhile for any estate involving significant appreciated assets. The information on this page is a factual summary of publicly available rules; for personal circumstances, a qualified tax professional can assess which rules apply and how they interact.