In this page:
Accounting Rules |
Tax Rates |
Intellectual Property |
Legal Framework |
- Tax Year
The fiscal year begins on 1 January and ends on 31 December of the same year.
- Accounting Standards
As a European Economic Area (EEA) member, Iceland applies the European IAS/IFRS regulations.
- Accounting Regulation Bodies
Icelandic Ministry of Finance.
- Accounting Reports
The annual report must contain a profit and loss account, a balance sheet and an annual report.
- Publication Requirements
The Law refers to the notion of "good accounting method" as regards the methods of companies for the elaboration of financial statements.
All capital companies have to send a copy of their annual report to the legal authorities of the country. This annual report must contain a profit and loss account, a balance sheet and an annual report.
The report must be in Icelandic, Danish or English. However, companies registered in Iceland, whose income mainly comes from foreign sources, can present a report in a foreign currency and language.
- Professional Accountancy Bodies
The Institute of State Authorized Public Accountants in Iceland
- Certification and Auditing
Every limited company in Iceland is required to elect an auditor or inspector and have its annual accounts audited. For public limited companies, a state-authorized public accountant must perform a full-scale audit. Publicly listed companies must elect two auditors, one of whom must be a state-authorized public accountant.
You can contact an external auditor: Ernst & Young, Deloitte, KPMG and PricewaterhouseCoopers.
- Accounting News
Invest Iceland: information about accounting standards in Iceland
- Nature of the Tax
virðisaukaskattur abbreviated to VSK (VAT)
- Tax Rate
24% for most products and some services.
- Reduced Tax Rate
7% for food, books, hotels, radio and TV license fees, newspapers and magazines, water and electricity used for domestic purposes. 11% for e-books. No VAT for exports, public health-care services, schools, postal services, insurance and banking services.
- Other Consumption Taxes
Excise duties are levied on certain products such as automobiles, petroleum and diesel fuel.
Learn more about Service Providers in Iceland on Globaltrade.net, the Directory for International Trade Service Providers.
- Company Tax
- Capital Gains Taxation
Capital gains are currently subject to the normal corporate income tax rate.
- Main Allowable Deductions and Tax Credits
Non-resident companies can deduct part of their expenses. For further information visit the Invest Iceland website.
- Other Corporate Taxes
Industrial tax, property tax, social security contributions, stamp duty.
For further information visit the Invest Iceland website.
- Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
Country Comparison For Corporate Taxation
|Number of Payments of Taxes per Year
|Time Taken For Administrative Formalities (Hours)
|Total Share of Taxes (% of Profit)
- Last Available Data.
||Progressive rate from 22.9% to 31.8%
|Up to ISK 2,897,703
|ISK 2,897,703 to ISK 8,874,108
|ISK 8,874,108 and upwards
|Municipal income tax
||Between 12.44% and 14.48%
- Allowable Deductions and Tax Credits
There may be different possible deductions according to situation and income (deduction of payments to obligatory pension funds, personal tax credit for all individual taxpayers).
For further information visit the Invest Iceland website.
- Special Expatriate Tax Regime
There are in general no special provisions for expatriates.
Learn more about Taxes and Accounting in Iceland on Globaltrade.net, the Directory for International Trade Service Providers.
- National Organizations
The organization in charge of the protection of intellectual property in Iceland is the Patent Office of Iceland (Einkaleyfastofan) Iceland signed the Paris Agreement regarding the protection of industrial property and the agreement which established the World Intellectual property Organization (WIPO). As for patents, the country adheres to the Munich Agreement for European patents, as well as to the Patent Cooperation Treaty (PCT). Iceland did not sign the Madrid Agreement concerning the international register of trademarks but adhered to the 1989 protocol , which came into force in Iceland on January 1st, 1997.
National Regulation and International Agreements
- Independence of Justice
The country’s judiciary is independent.
- Equal Treatment of Nationals and Foreigners
The country’s judicial system guarantees equal treatment to foreign nationals.
- The Language of Justice
Icelandic is the judicial language used in Iceland.
- Sources of the Law and Legal Similarities
The main source of the law is the constitution of 1944 which has been amended many times. The legal system is based on a civil law system originating in Danish law. Iceland has not accepted compulsory ICJ jurisdiction.
Learn more about Lawyers and Legal in Iceland on Globaltrade.net, the Directory for International Trade Service Providers.
- National Standards Organizations
IST, Icelandic Standards
- Integration in the International Standards Network
The organization responsible for norms and certificates of compliance is Icelandic Standards (Stadlarad). IST is a member of the European Committee for Standardization (CEN), the European Committee for Electrotechnical Standardization (CENELEC), the European Telecommunications Standards Institute (ETSI), the International Organization for Standardization (ISO), and of the International Electrotechnical Commission (IEC).
- Classification of Standards
The Icelandic standards are the IST. Iceland observes the classification of international standards of the International Organization for Standardization (ISO).
- Online Consultation of Standards
To look up standards on line, visit the website of Icelandic Standards or the website of ISO.
- Certification Organizations
Icelandic Standards: organization for certification and standardization
- General Information
Kwintessential, how to behave when doing business in Iceland
- Opening Hours and Days
Banks open Monday to Friday from 9.15 am to 4 pm; Lansbanki's branch, in Keflavik airport, is open every day from 6.30 am to 6.30 pm.
Shops are open Monday to Friday from 9 am to 6 pm, and on Saturday from 10 am to 4 pm.
Supermarkets open every day from 10 am to 10 pm.
Public Administrations are open Monday to Friday from 9 am to 4 pm.
|New Year's Day
|1st Day of Summer
|Christmas Eve (1/2 day)
|New Year's Eve (1/2 day)
Periods When Companies Usually Close
||Beginning of January
||June, July and August
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Last Updates: February 2015