SkatteFunn is a Norwegian government initiative to support innovation through tax deduction for R&D-projects.

SkatteFunn will grant tax deductions for R&D projects that either aim to develop a completely new product or service, or to projects that have a production method which greatly improves an existing one. To be eligible, your company must be incorporated and liable to pay corporate tax in Norway. The project needs to generate new knowledge, capabilities or skills within the company. Your application needs to clearly state how the project will benefit the company and how it will generate value.

If the project expenses are greater than the company is liable to pay in tax, the remaining amount will be paid out in cash. If your company does not generate any taxable income, the entire SkatteFunn credit is paid out in cash. All applications are processed and evaluated by the Research Council of Norway. In order to claim R&D tax credit, the project needs to be pre-approved by the Council. A distinction is made between SMEs and large corporations. SMEs may be granted deductions up to 20% of the total cost of the R&D project. Larger corporations may be eligible for deductions up to 18% of the total cost.

• The cost ceiling for R&D projects using in-house resources is 20 million NOK per year
• The cost ceiling for projects also using external pre-approved resources is 40 million NOK
• A maximum of 1850 hours annually per employee is accepted in the cost plan for the R&D project. The hourly salary must nok exceed 0.12% of the employees annual salary with a cap of 600 NOK
• Your company may submit multiple SkatteFUNN applications but the cost ceilings apply per company per year

For more detailed info on eligibility, click here

Application process

For your project to be approved as an R&D project eligible for tax deduction through SkatteFUNN, you need to clearly state your project objectives and define goals, milestones and how you plan to overcome obstacles.

• Although its possible to submit your application anytime throughout the year, submitting an application before September 1st will guarantee that your application will be processed within the year you submitted.
• Those submitting applications after September 1st risk losing the opportunity to deduct R&D costs accrued in the submission year from their corporate tax.

For more detailed info on the application process, click here.