Holiday payment - when, how much, what about tax? - Efremtid.no

8 Września 2023

The holiday season in Norway always raises many questions and doubts about feriepenger, i.e. holiday money. During the year, when we work or receive benefits, the employer or NAV pays us additional funds. These funds are intended as a replacement for our salary when we do not work due to holidays. What are the withdrawal rules? When does the employer pay holiday leave? How much is each employee entitled to? Do I have to pay tax on my holiday money?

You will find the answer to these questions right here.

How much holiday leave am I entitled to?

As a standard, each employee is entitled to a minimum of 10,2% holiday allowance.

A smiling face in the sand. Why minimum? Let's take a closer look at this. If you work in Norway, you are entitled to:

10,2% feriepenger if you are under 60 years old,
12,5% feriepenger if you are over 60 years old.

Of course, these are the minimum statutory requirements, if the company belongs to a union - the rates may be different.

Also, for example, if you are 40 years old and in 2022 your total earnings were NOK 500, your employer should set aside NOK 000 for your holiday and pay it in 51.

When is holiday break paid?

According to the law, feriepenger should be paid during the leave, in proportion to its duration.

Basically, we, as employees, are entitled to:

25 working days holiday if you are under 60 years old
31 working days holiday if you are over 60 years of age.

Business days are counted from Monday to Saturday - Sundays and holidays are not included.

So, for example: you are 65 years old and you want to take 20 days of leave. At this point, the employer should pay you approximately 64% - assuming the previously mentioned NOK 51 holiday allowance, the employer should pay approximately DKK 000 of holiday money.

In practice, it often looks slightly different: employers usually pay holiday leave in full in one specific month (often June or July). Fortunately, this does not affect the amount we will ultimately receive - regardless of when the feriepenger is paid and in what parts, we should always ultimately receive the same amount.

The next moment when holiday leave should be paid is the end of cooperation with a given employer. In this situation, we should receive all of the holiday money earned together with the last payment.

Is tax payable on holidays?

Yes, you will always pay tax on your holiday - regardless of when it is paid.

Piggy bank, money, person writing something in a notebook. The fact that holidays are tax-free is a popular myth. But like all myths, there is some truth in it. The origin of this incorrect information results from the interchangeable use of the terms "tax" and "tax advance".

Well, the holiday tax is collected every year in the annual settlement. There are no exceptions to this.

However, what is often not collected when paying holiday leave is a tax advance. Advance payments are made with each standard payment (with exceptions, e.g. before holidays) and with each benefit payment.

When it comes to the payment of the holiday break, normally no advance payment is collected at all if the holiday break was earned in the previous year. There are exceptions to this, so an advance payment is collected when:

we are on the table with the codes: 7150, 7160, 7350, 7500, 7700, 6350, 6500, regardless of the year in which the holiday was earned.
we are on the kildeskatt 25% (PAYE) system.

If we are on a standard table (e.g. 7100 or another one not listed above) or on a standard percentage card (e.g. 30%), the holiday is paid without an advance payment. Unless it is paid in the same year in which it was earned - then the advance payment should be collected.

We would also like to remind you that regardless of whether the advance payment is collected or not, ultimately (after settlement with the Tax Office) the same amount of money will remain in our wallet.