Iceland
Northern Europe · IS · 44 treaties
What are the main tax rates in Iceland?
Iceland has a top personal income tax rate of 46.29%, a corporate tax rate of 20%, and a standard VAT of 24%.
Tax profile
| Corporate income tax | 20% |
| Withholding — dividends | 20% |
| Withholding — interest | 12% |
| Withholding — royalties | 20% |
| VAT / GST (standard) | 24% |
| Personal income (top rate) | 46.29% |
| Capital gains | 22% |
| Tax system | Worldwide |
| Residency threshold | 183 days |
| Exit / departure tax | No |
| CFC rules | Yes |
| Transfer pricing | Oecd Aligned |
| Digital nomad visa | Long-term visa for remote workers |
| Digital services tax | none |
| Global minimum tax (Pillar 2) | None |
Common questions
- How long does it take to become a tax resident in Iceland?
- It takes 183 days to establish tax residency in Iceland.
- What is the capital gains tax rate in Iceland?
- The capital gains tax rate in Iceland is 22%, and cryptocurrency is taxed at this rate.
- Does Iceland have a digital nomad visa?
- Yes, Iceland offers a digital nomad visa.
Tax residency
ModerateWhat makes you a tax resident — and how hard it is to stop being one.
- permanent residence (legal domicile) in Iceland under Article 1 of the Income Tax Act creates unlimited tax liability
- staying in Iceland for more than 183 days in any 12‑month period creates tax residency from the date of arrival
- staying in Iceland for less than six months in a twelve‑month period results only in limited tax liability on Icelandic‑source income
Tax residency normally ends when you leave Iceland, but former residents with Icelandic domicile remain subject to unlimited tax liability for three years after departure unless they prove tax residency in another country, which adds a moderate tail to breaking residency.
Source: Iceland Revenue and Customs (Skatturinn)
Tax treaty network (52)
In-force double-tax treaty partners. Treaty-reduced withholding (dividends / interest / royalties) shown where the official source publishes a rate; otherwise the country's statutory rate applies unless the treaty text provides a reduction.
| Partner | Div | Int | Roy |
|---|---|---|---|
| Argentina | — | — | — |
| Australia | 15% | 10% | 10% |
| Austria | 15% | 10% | 5% |
| Belgium | 15% | 10% | 0% |
| Bulgaria | — | — | — |
| Canada | 15% | 10% | 10% |
| China | 10% | 10% | 10% |
| Czechia | 15% | 0% | 10% |
| Denmark | 15% | 0% | 0% |
| Estonia | 15% | 10% | 10% |
| Finland | 15% | 0% | 0% |
| France | 15% | 0% | 0% |
| Georgia | 10% | 5% | 5% |
| Germany | 15% | 0% | 0% |
| Greece | 15% | 8% | 10% |
| Hungary | 10% | 0% | 10% |
| Ireland | 15% | 0% | 10% |
| Israel | — | — | — |
| Italy | 15% | 0% | 5% |
| Japan | 15% | 10% | 0% |
| South Korea | 15% | 10% | 10% |
| Latvia | 15% | 10% | 10% |
| Lithuania | 15% | 10% | 10% |
| Luxembourg | 15% | 0% | 0% |
| Mexico | 15% | 10% | 10% |
| Netherlands | 15% | 0% | 0% |
| Norway | 15% | 0% | 0% |
| Poland | 15% | 10% | 10% |
| Portugal | 15% | 10% | 10% |
| Romania | 10% | 3% | 5% |
| Russia | 15% | 0% | 0% |
| Slovakia | 10% | 0% | 10% |
| Slovenia | 15% | 5% | 5% |
| Spain | 15% | 5% | 5% |
| Sweden | 15% | 0% | 0% |
| Switzerland | 15% | 0% | 5% |
| Turkey | — | — | — |
| Ukraine | 15% | 10% | 10% |
| United Kingdom | 15% | 0% | 5% |
| United States of America | 15% | 0% | 5% |
| Uruguay | — | — | — |
| Vietnam | 15% | 10% | 10% |
| South Africa | — | — | — |
| Albania | 10% | 10% | 10% |
| Barbados | 15% | 10% | 5% |
| Croatia | 10% | 10% | 10% |
| Cyprus | 10% | 0% | 5% |
| Faroe Islands | 15% | 0% | 0% |
| Greenland | 15% | 0% | 15% |
| India | 10% | 10% | 10% |
| Liechtenstein | 15% | 0% | 5% |
| Malta | 15% | 0% | 5% |