Iceland

Iceland scraps e-book VAT 2019

April 10th, 2018

Iceland’s Ministry of Finance and Economic Affairs is to reclassify electronic books as zero-rated for Value Added Tax from 1 January 2019. E-books are currently subject to the reduced VAT rate of 11%. Iceland is a member of the EEA, and not a member of the European Union where countries are obliged to charge the …


Iceland

Icelandic VAT rates and compliance

April 6th, 2018

Icelandic VAT rates There are 2 two VAT rates, plus a nil rating: The current rates are: Icelandic VAT compliance As a tax payer, VAT registered business must comply with the rules and record keeping requirements of the VAT Act. This includes invoice format and records.  VAT invoices and records must be stored for at …


Iceland

Icelandic invoice rules

April 6th, 2018

Invoice date of issue VAT invoices must be issued within 30 days of the provision of a supply. Icelandic invoice requirements Name, including trading name, and address of supplier and customer VAT number of the supplier Date of invoice Description, including quantities/weights etc, of the taxable supplies Taxable amount, VAT added, gross amount Foreign currency invoices …


Iceland

Icelandic VAT returns

April 6th, 2018

VAT registered businesses must file regular returns with the Icelandic Tax Authority. These are usually filed electronically – the exception is the annual VAT return which may be paper-based. What are the deadlines for filing Icelandic VAT returns? VAT returns must be submitted by the 15th of the month following the reporting period end.  Any …


Iceland

Icelandic VAT registration

April 6th, 2018

What are the Icelandic VAT registration thresholds? There is a VAT registration threshold for foreign companies providing taxable goods or services in Iceland. This is currently ISK 2 million annual turnover – calculated on a calendar basis. Businesses may apply for a voluntary VAT registration. Foreign businesses surpassing this limit should register within eight days …


Iceland

Iceland

April 6th, 2018

Iceland introduced Value Added Tax (VAT) in January 1990. The local term is Virðisaukaskattur. Icelandic VAT is generally based on the European Union VAT regime since Iceland is a member of the European Economic Area. It is administered by the Ministry of Finance.   What activities require an Icelandic registration? Non-resident companies providing the following …


Iceland

Iceland considers Occupancy Tax over VAT

December 12th, 2017

The new Icelandic government has scrapped plans to introduce VAT on short-term room and house rentals. Instead, it will review an Occupancy Tax – similar to the nightly fees imposed by many EU cities such as Paris, Brussels and Rome. It is not yet clear if the new levy will be a fixed, per night …


Iceland

Icelandic VAT on digital services

November 9th, 2017

Iceland subjected foreign providers of electronic/digital services to VAT from 1 November 2011. Definition of Icelandic digital services Services delivered via the internet or other electronic networks subject to VAT include: Downloads or streaming movies, music, software and images Apps Automated databased services Online news and journals Website hosting and webpage hosting Remote systems administration Data …


Iceland

Iceland VAT rate to 22.5% 2019

April 6th, 2017

The Icelandic government is planning to reduce its standard VAT rate from 24% to 22.5% from 1 January 2019. The announcement came as part of the 2018 to 2022 fiscal budget plan. Iceland had raised its VAT rate to 25.5% during the global financial crisis in 2010, but cut it to 24% in 2015. Tourism …


Iceland

Iceland doubles VAT registration threshold

January 11th, 2017

Iceland has increased the annual taxable sales threshold for VAT registration from ISK1million to ISK2million. This will apply from 1 January 2017. The threshold only applies to resident businesses.  Non-resident businesses selling taxable supplies locally and who have to register face a nil threshold.