– I expect that when the interest rate increases, I will work myself to death alongside my studies to be able to keep that mortgage. Solveig Marie Hokland Larssen from Harstad is studying to become a teacher. She lives in Oslo where she has bought an apartment. Which means that she has a loan of over three and a half million kroner. Right now, she has fixed the interest rate at 1.79 per cent, but that agreement expires in the spring. Larssen currently has a 20 percent permanent position as BPA alongside his studies. It has been a few long days with normal working days in practice, and then working until 10pm in the evening to make ends meet. – The interest deduction is what makes it go round. I think it will be very difficult to combine more work with a full-time study when the interest rate is so high. But, when the interest rate goes up, you also get more back in tax. Update your tax card From today you can go in and make changes to your tax card for 2023. It may be a good idea if you do. Because there is a good chance that the changes that have taken place in the last year are already affecting your finances. When we entered 2022, just before the extreme weather Gyda swept across the country and Nils Arne Eggen died, the key interest rate at Norges Bank was a paltry 0.5 per cent. Just over a year later and the same interest rate is 2.5 per cent. And on Thursday the message came that it will go up another notch to 2.75 per cent. The actual interest that your bank charges you will be even higher. This means you have to pay them even more for lending you money. Most people get a floating interest rate on their home loan of between 4 and 5 per cent when we enter the new year. And this is where your tax card comes into play. Because with an interest rate more than twice as high as the last time you (perhaps) came in and adjusted, there is also significantly more to collect in interest deductions. Norway gives 22 percent of what you pay in interest back to you. This means that you can calculate the actual sum you will pay in interest in 2023 and enter this in your tax card. If you have a loan of NOK 3 million and an interest rate of 4.5 per cent, you will pay NOK 135,000 in interest in one year. This means that you get NOK 2,475 back on tax every month. – The most important thing you can do – As the situation is now, it is extra important that you enter correct information. That’s what Marta Johanne Gjengedal says. She is a divisional director at the Swedish Tax Agency and is concerned that people pay the correct tax, because here there is money to be made in the everyday economy. Marta Johanne Gjengedal at the tax office says they are very concerned that people check that the correct information is on the tax card. Photo: Private – If you have financial challenges, having a correct tax deduction is the most important thing you can do. Then you know what money you have to deal with, says Gjengedal. If you go in and change your tax card now, before the New Year, you will get the full effect of the changes as early as the first payment of salary or pension in January. She recommends everyone to get checked. – There have been such big changes in 2022 that we probably won’t be able to take account of them in our calculations, says the director. Stupid to deduct too much in tax Hallgeir Kvadsheim is Norway’s private finance expert. He is, among other things, chairman of the board and the founder behind the Debt Collection Register. He has a good overview of how the private economy is affected by price increases. – It is stupid if you already have tight finances that too much is deducted in tax, he says. He points out that there is no problem if you can live well with a slightly high tax deduction, because you will get the money back in the tax settlement the following year. Hallgeir Kvadsheim is known to many from Luksusfellen on TV3. He says it is very easy to change the tax card, and that your bank can help you get the right information. Photo: Rolf Petter Olaisen / news – But many people need the money now and do not want to wait a year and a half to get it. And then it is very smart to adjust your tax card so that you get lower tax deductions. Kvadsheim explains that the Tax Agency takes the figures on your previous tax return as a starting point when they make their calculations. It is based on your finances in 2021. – Last year was a year of record low interest rates for the vast majority. Now 2023 will be a year with fairly high interest rates if you compare with the last ten years. This causes your tax card to be incorrect. He says the start of the new year is going to be a bit tight for many. It is only now that the effect of the previous interest rate hike is fully kicking in. – Then there are a number of bills that are due in January. The electricity bill is also typical, which is often much higher than at other times of the year, says Kvadsheim, who believes that January and February can be tough for many. More conscious spending Back in Oslo, Solveig Marie Hokland Larssen is well aware that prices have risen a lot recently. Because in addition to the interest rate increase, the prices of most things have risen sharply. – The housing association has increased the joint costs, and I have also noticed that food has become more expensive, says Larssen. She says she realizes that she needs to be more conscious when she shops. – I can’t go out to do as many fun things now as before. I need to be more aware of when I draw the card.
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You can get more money a month to spend if you remember to adjust the interest deduction on the Tax Card – news Trøndelag
