Norway's tax authority has introduced a new valuation model that is significantly increasing the assessed market value of primary homes for millions of taxpayers. The change, part of the preliminary tax assessment for 2026, is leading to sharply higher wealth tax calculations, particularly for homeowners in urban areas with properties valued above 10 million kroner. Avdelingsdirektør Ove Nyland at Skatteetaten confirmed taxpayers have the right to challenge the figure. 'If you believe the calculated market value is wrong, you can change your tax card. In the tax card, you must state the market value you believe is correct at the end of 2026,' Nyland said in a statement.
A New Model, Higher Bills
The new calculation model aims for more accurate estimates of a home's market value, known as its 'ligningsverdi'. For the 2026 tax year, many homeowners have received notices with substantial upward adjustments. In some cases, the state's estimated value far exceeds what owners believe is an achievable sale price. This valuation forms the basis for calculating wealth tax, directly impacting the preliminary tax deducted from salaries and pensions throughout the year. The shift is most pronounced for properties exceeding the 10 million kroner threshold, where the taxable wealth base has been progressively increased in recent years.
The Mechanics of the Tax Climb
Recent legislative changes have steadily tightened the valuation rules for primary residences. Until 2022, the taxable wealth base was a flat 25 percent of the assessed market value. For the 2022 tax year, this was raised to 50 percent for values above 10 million kroner. From the 2023 tax year, it was increased again to 70 percent for the portion above that threshold. In contrast, the taxable value of secondary homes, meaning property other than a primary residence or holiday home, has been set at 100 percent of its calculated or documented sales value since 2023. The latest update to the valuation model itself is now applying further upward pressure on the starting figure for these calculations.
Retirees and City Dwellers Hit Hardest
The change disproportionately affects homeowners in major cities with little to no mortgage debt. This includes many older pensioners who purchased their homes decades ago and now live in debt-free properties whose market values have skyrocketed. Reports are emerging of pensioners facing significant reductions in their monthly pension payments for 2026 due to the higher tax deductions. Single pensioners are said to be impacted to an even greater degree, as they cannot split the wealth tax deduction with a spouse. For this group, a higher assessed property value directly translates to less disposable income from their fixed pensions.
How to Challenge Your Valuation
The tax authority strongly advises all individuals to check their preliminary tax assessment for accuracy. The process for disputing the new property value differs depending on the timing. Adjustments can be made directly in the current tax card for 2026 on the Skatteetaten website without any immediate documentation requirement. After changes are made, the authority generates a new tax card, which is then automatically fetched by employers or the National Insurance Administration. However, if a taxpayer believes the wealth value is incorrect when the official tax return for 2026 is issued next year, any change must be formally documented. This documentation must date from after July 1 of the 2026 income year.
Navigating the Updated System
This procedural distinction is crucial for homeowners. The current period allows for a correction of the pre-filled value in the tax card based on the taxpayer's own assessment, aiming to prevent over-withholding during the year. It is a proactive measure to manage cash flow. The subsequent, stricter documentation requirement for the annual tax return serves as the final settlement. The system is designed to give taxpayers an initial opportunity to correct what they see as an obvious overvaluation without bureaucratic hurdles, while requiring proof for the formal year-end assessment. The updated tax card, once revised, forms the basis for all salary and benefit payments until a new assessment is made.
The Broader Fiscal Picture
The continued adjustments to property valuation rules reflect a sustained political focus on wealth taxation in Norway, particularly targeting high-value real estate in sought-after urban areas. The cumulative effect of raising both the valuation percentage and refining the underlying model has created a significant policy shift over a short period. While the intent is to align tax assessments more closely with real market values, the practical outcome is a noticeable increase in the tax burden for specific demographics, notably asset-rich but potentially cash-poor retirees. This tension between accurate valuation and taxpayer affordability lies at the heart of the current feedback to Skatteetaten. The authority's reminder to review the tax card is a direct response to the anticipated volume of inquiries and disputes this new model will generate.