It just so happens that Norway, taxes, and investing are new things in my life, and I am sure there are ppl in this subreddit who have some experience with this.

I have recently started looking into various investment options which my Norwegian bank (No\*\*ea) offers, and I was convinced that index funds fit my risk profile best…right until I started thinking about taxes. This [Skatteetaten page](https://www.skatteetaten.no/en/person/taxes/get-the-taxes-right/shares-and-securities/about-shares-and-securities/share-savings-account-ask/) helped to answer the basic question of *”how much is taxed?”*, but I still have the following questions:

1. In general, if one gets an index fund and leaves it there for 5 years, *when is it taxed*? Every year based on the gain? Or when it is sold based on the gain?
2. Given the Norwegian tax rates, is there any investment product type (e.g. ETF, index fund) that is more tax efficient than others (given that my intention is hands-off long-term investment)?
3. Is the above-mentioned bank considered convenient for such type of investing? Only used their app for basic payments, seems quite user-friendly so far. I am aware that Nordnet is quite popular but I cannot see too much of an advantage over what my current bank offers.

Thank you!

3 comments

  1. You get taxed based on the gains when you sell, but not before that.

    Different types of investment products are taxed mostly the same. In my opinion it doesn’t matter much which one you pick. It also doesn’t matter much which bank you use, as long as you make sure to compare prices and make sure you are not being fleeced on the fees.

  2. https://www.skatteetaten.no/en/person/taxes/get-the-taxes-right/shares-and-securities/about-shares-and-securities/share-savings-account-ask/

    If you register your (index fund or other stock fund) investments to an Aksjesparekonto (AKS, or Share Savings Account) you will be taxed when you sell. If you sell and reinvest in other investments in the AKS account, the taxation will be delayed until you withdraw the investment from the AKS.

    All banks etc offer AKS accounts, and they’re often cost free.

    There are two types of taxation for investments in funds:

    >1) Investment gains after selling will be taxed as capital income. It’s not taxable income if a index fund increases in value from January 1 to December 31.

    >2) There’s also wealth tax, and index fund investments may indeed be taxed for this, gains or losses. However, the tax rate is low and the threshold for taxation is at a level where rather few individual tax payers actually pay this tax. There’s no taxation for combined net wealth (assets) below 1,7 mill NOK.

    https://www.skatteetaten.no/en/rates/wealth-tax/

    For long term investments, you could also look into the tax rebates for certain typed of pension savings: https://www.skatteetaten.no/en/person/taxes/get-the-taxes-right/employment-benefits-and-pensions/pension-and-disability-benefit/a-new-scheme-concerning-tax-favourable-individual-pension-saving/

    Banks, insurance companies etc could give you more information about the IPS pension savings with tax rebate. Basically, you can save up to NOK 15.000 per year in an IPS account (for example to be used in an index fund) and get a tax defuction of up to NOK 2.000,- for the tax year the investment was made. The investments can be sold when the investor is 62 years or older, over a period of at least 10 years. Some more terms and conditions apply.

    I short, the more tax efficient investments, would be the ones put into IPS pension savings, and investments with AKS stock savings account.

    The alternative to an AKS is a regular investor account. You might want one even if you have an AKS, as a regular investor accounts can be used for more types of investments. If you have investments in a regular investor account, you will still be taxed (for capital gains) only when you sell. The difference is that within the AKS scheme, you could reinvest without capital gains tax.On the other hand, if you sell a losing investment from a regular investor account, or from an AKS account without reinvesting, you could have a tax deduction that year for your financial loss.

    I believe one reason why Nordnet became popular, was their low fees. As fees and other costs may change over time, you may want to compare the fee levels and fee structure from different providers from time to time.

    Finally, for those under 34, there’s the popular BSU scheme for bank account savings with a tax deduction; for saving to buy a house/flat: https://www.skatteetaten.no/en/person/taxes/get-the-taxes-right/bank-and-loans/bsu—young-peoples-housing-savings/

    https://www.nordea.no/privat/vare-produkter/sparing-og-investering/sparing-pa-konto/bsu-konto.html
    There’s also this related type of bank account for saving to buy a house/flat, but without the tax deduction:
    https://www.nordea.no/privat/vare-produkter/sparing-og-investering/sparing-pa-konto/boligsparekonto.html

  3. 1. Taxed only when you sell or get dividends, or if you leave Norway, then there is this thing called “exit tax” for unrealised gains. I believe it also works the other way around if you have unrealised losses.
    2. As far as I know, not really. Unless you want to invest into something that is available on Norwegian stock exchange, then the AKS that was mentioned above could be better. On the other hand, if you plan to invest into a broad index fund and not sell and buy different kinds of stocks, then I also dont see how this AKS is useful. Its basically more for active investors, not for passive index funds investors.
    3. I personally just use international broker, such as Interactive Brokers. Dont know what’s your personal situation, but if you ever move out of Norway I believe its easier when your stocks are on one of these brokers that work globally.

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