Fiscal and Tax Environment in Iceland

27 January 2010
by Ina Dimireva -- last modified 22 June 2010

Information about the fiscal and tax environment for international organisations, investing in Iceland.

Tax System

New tax system has been implemented in Iceland since January 1st, 2010 after the government approved a series of reforms. Tax reforms consisted of restructuring of personal taxes from the current flat-rate of 24.1% to a three-tier system, along with increases in capital gains, VAT and tax-free exemptions.

• Tax on earnings less than ISK200,000 per month: 24.1%.
• Tax on earnings between ISK200,001 and ISK650,000: 27%.
• Tax on salaries above ISK650,001: 33%.
• The additional local government tax of 13% remains the same.
• Capital gains tax: 18%

Doing Business in Iceland

Source: Invest in Iceland Agency