Norway Inheritance and Gift Tax Guide

No Inheritance or Gift Tax — Abolished 2014

• Abolition: From 1 January 2014, no inheritance tax (arveavgift) or gift tax (gaveavgift) is payable on any inheritance or gift received, regardless of the amount or the relationship between the parties. There are no exceptions — large inheritances of NOK 100 million+ pass completely free of inheritance tax. This makes Norway one of the most attractive jurisdictions for wealth transmission in Europe.
• Pre-2014 rules (historical reference): Before abolition, inheritance tax was levied at progressive rates based on relationship. The tax-free threshold was approximately NOK 470,000 for children, with rates of 6–15%. The highest rate was 15% for distant relatives on amounts above NOK 800,000. The abolition eliminated the need for inheritance tax planning entirely for Norwegian residents.
• Countries with inheritance tax: For comparison, many other countries still levy inheritance taxes: the UK (40% above £325,000), Germany (7–50%, depending on relationship and amount), France (5–60%), the Netherlands (10–40%), and the US (40% federal estate tax above ~$13.99 million). Norway's position is therefore highly favourable for wealth transmission.

Capital Gains Tax on Gifts — Deemed Sale Rule

• Deemed sale (realisasjon): When an asset is gifted (given away below market value), the giver (donor) is treated as having sold the asset at its fair market value (omsetningsverdi) for CGT purposes — if the gift constitutes a "realisation event". The key threshold is: if the difference between the market value and the consideration (if any) exceeds NOK 500,000, the gift triggers a deemed sale and the giver must pay CGT on the unrealised gain at 22% (with oppjustering for shares).
• Gifts below NOK 500,000 undervalue: If the gifted asset has an unrealised gain, but the gift's undervalue (market value minus any payment received) is NOK 500,000 or less, no deemed sale occurs. The giver does NOT pay CGT at the time of the gift. Instead, the gain remains "dormant" and passes to the recipient — the recipient inherits the donor's cost basis and will pay CGT when they eventually sell.
• Calculation example: A parent gifts shares to a child worth NOK 2,000,000 with a cost basis of NOK 500,000 (unrealised gain: NOK 1,500,000). No payment is received. Undervalue = NOK 2,000,000 > NOK 500,000 threshold. The parent is deemed to have sold the shares at market value. CGT payable by parent: (NOK 2,000,000 − NOK 500,000) × 22% (adjusted for oppjustering if applicable) = approximately NOK 330,000. The child receives shares with a new cost basis of NOK 2,000,000.
• Planning threshold: Large gifts can be structured by spreading the gift value across multiple years or multiple recipients to stay within the NOK 500,000 limit. For example, giving NOK 490,000 worth of shares each year to the same child avoids the deemed sale trigger. However, this must be done genuinely as separate gifts — a pre-arranged plan to avoid the threshold could be challenged by Skatteetaten.

No Step-Up at Death — Carryover Cost Basis

• Carryover basis (kontinuitet): Norway does not provide a step-up in cost basis at death. The heir inherits the deceased person's original cost basis (anskaffelseskost). If the deceased bought shares for NOK 10 and they are worth NOK 200 at death, the heir inherits the shares with a cost basis of NOK 10. When the heir sells, they pay CGT on the full NOK 190 gain.
• Contrast with the US: The US provides a full step-up to fair market value at death (Section 1014 of the Internal Revenue Code). In Norway, there is no equivalent rule. This means capital gains are never "forgiven" at death — they persist until the heir sells the asset. This is a significant difference and can create large tax liabilities for heirs of long-held assets.
• Inherited property: The carryover basis rule applies to all assets: real estate, shares, collectibles, and business assets. For inherited primary residences, the heir can use the property as their own primary residence for 12 months before selling to qualify for the tax exemption (no CGT on primary residence sales).
• Documentation requirement: Heirs must obtain the deceased's cost basis documentation. For long-held assets, this can be challenging — Skatteetaten recommends keeping records of original purchase prices, share split histories, and corporate actions. In the absence of documentation, Skatteetaten may estimate the cost basis, typically conservatively.

Gift and Inheritance Planning

• Wealth tax planning: Gifting assets during lifetime removes them from the donor's net wealth (formuesskatt base) while they remain in the family. Since there is no gift tax, this is an effective strategy to reduce the donor's annual wealth tax liability. The recipient includes the assets in their own wealth tax calculation.
• Testament (testament): A Norwegian will is recommended to clarify asset distribution (arv). Without a will, the Norwegian Inheritance Act (arveloven) applies: the surviving spouse inherits 50% of the estate; the children inherit the remaining 50% in equal shares. The minimum inheritance for children (pliktdelsarv) is 2/3 of their statutory share — the remaining 1/3 can be freely disposed of by will.
• Cross-border inheritance: For Norwegian residents inheriting assets abroad, or non-residents inheriting Norwegian assets, the inheritance follows the rules of the deceased's country of residence (for movable assets) or the property's location (for real estate). Norway has limited inheritance tax treaties — cross-border planning often requires professional advice.
• Life insurance: Life insurance payouts in Norway are tax-free to the beneficiary. This is a common estate planning tool to provide liquidity for the estate without triggering tax consequences. Insurance proceeds are not included in the probate estate for inheritance purposes.

For capital gains tax on inherited assets when sold, see our Capital Gains Tax Guide →. For wealth tax reduction through lifetime gifting, see our Wealth Tax Guide →. For personal income tax and the skattekort system, see our Personal Tax Guide →.