An unintentional error in the electronic completion of the tax return does not constitute grounds for imposing a tax surcharge

A company completed the business income statement accompanying its tax return using a standard annual accounts software program. The employee responsible for the completion clicked the wrong option in a drop‑down menu, resulting in the reporting of income that was too low. The Norwegian Tax Administration accepted that the error was not due to an attempt at tax evasion, but nonetheless imposed a tax surcharge of 20 percent, as the error could not be regarded as an obvious arithmetical or clerical error.

The District Court set aside the tax surcharge decision and – unlike the Tax Administration – found that the error constituted an obvious clerical error. The Court of Appeal reached the opposite conclusion.

The Supreme Court reached the same conclusion as the District Court. Unintentional keystroke errors or misclicks made during electronic completion must be equated with traditional clerical errors. In both cases, the decisive factor is whether the information entered does not correspond to what the person completing the form intended to report. The majority of the Supreme Court found that this was the case here. A minority of two justices, however, considered that the error was due to a misjudgment falling outside the concept of a “clerical error”.

The error also had to be regarded as obvious, since the tax authorities could not avoid discovering that there was an error in the business income statement. It is not a requirement that the authorities understand the precise nature of the error.

As tax surcharges may not be imposed in cases of unintentional and obvious clerical errors, the decision of the Tax Administration was set aside.

Read the judgment from the Supreme Court (PDF)

Area of law: Tax law. Section 14-4 of the Tax Administration Act.

Key paragraphs: 43, 52, 58–59, 65–66

Justices: Bergsjø, Høgetveit Berg, Thyness, Stenvik, Sivertsen