Iceland

Overview

Last reviewed - 05 February 2020

Iceland, a European island, is a country located in the North Atlantic Ocean. The Icelandic population is about 330,000, and the capital city is Reykjavík. The currency is the Icelandic króna (ISK), and the official language is Icelandic.

Althingi, Iceland’s present-day parliament, is one of the world’s oldest existing national assemblies. Founded at Thingvellir in 930 AD, the country’s democratic system of government was completely unique in its day. In 1262, Iceland came under the Norwegian king and, later, at the end of the 14th century, Iceland was brought under Danish rule. Throughout the next two centuries, Iceland was crippled by rampant foreign profiteering, beset by international pirates, and subject to an increasing number of natural disasters. The 18th century marked the most tragic age in Iceland's history. The population sank to about 35,000. The 19th and 20th centuries are marked as stepping stones towards independence, and by 1918 Denmark had recognised Iceland as a fully sovereign state united with Denmark under a common king. Finally, Iceland became an independent republic on 17 June 1944 and has remained as such to this day. Its sovereign is the president, who is voted in general election every four years. The parliament, Althingi, is comprised of 63 individuals voted in general election every four years.

The fish industry (fishing and processing) and the tourism industry are the main economic activities in Iceland. Other important activities include aluminium smelting and agriculture.

PwC Iceland offers a full range of audit and assurance services, tax consulting services, and business advisory services. PwC Legal ehf. provides legal services to clients requiring legal assistance. Our local offices are based in Reykjavík, Akureyri, Húsavík, Selfoss, Hvolsvöllur, and Reykjanesbær.

Quick rates and dates

Corporate income tax (CIT) rates
Headline CIT rate (%) 20
Corporate income tax (CIT) due dates
CIT return due date 31 May
CIT final payment due date 1 November and 1 December
CIT estimated payment due dates Advance tax is due on the first day of every month, except January and October.
Personal income tax (PIT) rates
Headline PIT rate (%) 31.8, plus municipal tax
Personal income tax (PIT) due dates
PIT return due date 10 March
PIT final payment due date Any deficit is collected on five due dates each year (first day of July to December).
PIT estimated payment due dates Monthly
Value-added tax (VAT) rates
Standard VAT rate (%) 24
Withholding tax (WHT) rates
WHT rates (%) (Div/Int/Roy) Resident: 22 / 22 / 0;
Non-resident: 20 / 12 / 20
Capital gains tax (CGT) rates
Corporate capital gains tax rate (%) Capital gains are subject to the normal CIT rate.
Individual capital gains tax rate (%) 22
Net wealth/worth tax rates
Headline net wealth/worth tax rate (%) NA
Inheritance and gift tax rates
Inheritance tax rate (%) 10
Gift tax rate (%) Gifts are taxable as ordinary income.

NA stands for Not Applicable (i.e. the territory does not have the indicated tax or requirement)

NP stands for Not Provided (i.e. the information is not currently provided in this chart)

All information in this chart is up to date as of the 'Last reviewed' date on the corresponding territory Overview page. This chart has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this chart, and, to the extent permitted by law, PwC does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.