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The budget proposal for 2016 was announced by the Norwegian government on October 7th 2015. Even bigger changes may come in the future as outlined in the tax reform proposal submitted on the same day:

- Decrease of the ordinary income tax rate from 27% to 25% down to 22% in 2018
- The taxation of dividend income received by an individual to increase from 27% to 28.75% in 2016 and 31.5% in 2018

- A decrease in wealth tax from 0.85% to 0.80% and an increase of the threshold from 1.2 to 1.4 MNOK
- Increase of the taxable values of second homes and commercial real estate from 70% to 80% of market value
- The taxation of “combination funds” (funds investing in securities and bonds) will be amended to better reflect the composition of assets.

In order to reorganise their existing wealth planning structures, many investors are now looking to take out assets from their investment companies and transfer the wealth to more appropriate structures while the dividend taxation is still relatively low.

Capital insurance benefits from the low ordinary income tax rates can complement or provide an alternative to existing holding company structures. Also, it offers a competitive alternative to a combination fund, which as of 2016 will be subject to less favourable taxation.  

Cross-border life

Families are becoming increasingly global. Many now have second homes in southern France and grandchildren studying elsewhere, for example in the UK. As a result, they now need to address tax and succession matters that span over several jurisdictions.

Lombard International Assurance has more than twenty years of experience catering to the needs of high net worth families faced with complex and changeable circumstances. As such, we are well placed to respond to the latest challenges and assist individuals and families in Norway looking for long-term wealth solutions.
 
Lombard International Assurance`s solutions for Norwegian residents offer the following benefits:

  • Single compliant solution with a diverse portfolio of assets
  • Solid structures for multi-jurisdictional families that will meet the needs of the client today and in the future
  • Succession planning with a possibility to transfer the legacy to the next generations living in Norway or abroad.
  • Tailor-made wealth planning solutions taking into account existing structures
  • Tax deferral until pay-out from the policy. The proportional gain is taxed at ordinary tax rates (25% in 2016 and expected to decrease to 22%)
Well known structure benefiting from favourable tax regimes in Europe and beyond
No exit tax when emigrating from Norway
 
The early adopters have already been active in reviewing their existing structures. “Together with the family advisers, we have helped put in place tailor-made wealth planning solutions taking into account  existing structures,” commented Senior Wealth Planner, Emilia Weijola.
 
“As the complexity increases the demand for simple, flexible wealth management solutions for today and future generations will increase,” said Country Manager Marjanne Olesen.

To learn more about our solutions please contact Marjanne Olesen or your usual Lombard International Assurance representative.

Download the article in Norwegian.