On 19 April 2016, the Norwegian tax authority (Skatteetaten) issued its interpretation on whether the country's tax exemption for dividends and capital gains applies when received from investment funds. In particular, investment funds in Denmark, Germany, Ireland and Sweden.
Under Norway's participation exemption regime, dividends received from EEA countries are 97% exempt (100% if holding more than 90% of the capital) and capital gains from the sale of shares are fully exempt. However, the entity from which the dividends or capital gains are received must be comparable to a qualifying Norwegian entity, which means the entity must be fully liable to tax. Based on this, the exemption does not apply for dividends or capital gains from Danish, German and Irish investment funds, because the funds are generally exempt from tax on their income. However, a Swedish investment fund is liable to tax, and therefore the exemption for dividends and capital gains applies.
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