You can register your own company in Norway under various legal forms. The one-person company is the most popular, as we wrote about here, while the capital company enjoys the greatest trust, as we wrote about here (link after the publication of the previous post). Entrepreneurs who already have an active activity in another country, wishing to run a business in Norway, can only register a branch.
What is it and what are the types?
NUF (short for Norskregistrert utenlandsk foretak) is nothing else than a registered branch of a foreign company in Norway. There are two options for NUF registration: with a VAT representative or a contact person.
NUF with a VAT representative
NUF with a VAT representative is necessary when the company conducts business in Norway. Its turnover exceeds 50 Norwegian kroner. In such a case, the owner of such a company must register as a VAT payer and send reports to the Tax Office. It's worth knowing that Norwegian government has signed an agreement with some countries under which it is possible to avoid double taxation of goods and services. Then such an entrepreneur will have two options settlement of this tax – either in Norway or in your home country.
With a contact person
This type of branch of a foreign company applies to those entities that are engaged in hiring employees to work in Norway. The obligation to register this legal form is connected with the fact that the company is obliged to maintain contacts with Norwegian institutions. In case of any questions, irregularities or doubts, there is a contact person with whom everything can be clarified.
Benefits of NUF registration
The registration of a foreign branch is quite smooth. It is enough to submit an application to Bronnoysundregistrene with the necessary attachments. The advantages of such a solution also include the fact that Norway is legally operating without the need to register an additional entity and the possibility of avoiding double VAT taxation.
Disadvantages and Limitations
Apart from the advantages, running a NUF in Norway has quite significant disadvantages and limitations. These include, first of all, lower trust of potential contractors in such companies. Additionally, during the performance of the contract with Norwegian companies, the entire process is burdened with numerous administrative formalities.
Limitations also include the following:
- double withholding income tax - in the home country and in Norway
- keeping double accounting
- numerous controls from the tax office and the state labor inspection
- double financial and fiscal responsibility - in the home country and in Norway
NUF in Norway - is it worth it?
Registering a foreign branch in Norway is not one of the most profitable forms of doing business. However, in some cases it is unavoidable - especially when the owner wants to provide services or sell goods in Norway, but cannot or does not want to register there. Whenever possible, a more profitable legal form is a sole proprietorship or setting up a capital company. Both from a business point of view and in the context of financial and tax settlements.
