The Norwegian Tax Administration has published a 2018 ruling concerning the carry forward of losses following a demerger that was performed as part of an agreement to discontinue cooperation between certain parties. In general, if the primary motive of a restructuring, such as a demerger, was the utilization of the loss carryforward, then such utilization may be denied. Where the primary motive is a business motive, then the utilization of the loss carryforward should be allowed. In the ruling, it was found that although the business motive - discontinuing cooperation - objectively appeared to be limited, it did not appear to be outweighed by a motive of utilizing the losses. As such, the ruling recommends that the utilization of the tax position was not the primary motivation for the transaction and therefore the utilization of the loss carryforward should be allowed.
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