Currency and salary
Taxes
The currency in Iceland is the Icelandic króna (ISK)
1 EUR = 123,53 ISK (21.02.18)
Personal identification number:
Each individual working in Iceland needs a personal identification number (kennitala), this number will be provided to you by our company either upon your arrival or about 1-2 days after your arrival.
In order to receive your salary, you are required to have an Icelandic bank account.
One of our employees will arrange for you to be taken to the bank and assist you with setting up your bank account.
When you have set up your bank account it is important to write down the account details and send it to us as soon as possible via email.
An individual has to pay tax on income arising from sources in Iceland although he still has unlimited tax liability in another country. Taxable income includes, for example cash payments, wages, fees, sickness allowance and benefits in kind.
For the income year 2018 the rate of income and municipal tax is calculated in two steps;
ISK 0 - 893.713 pr. month 36,94%.
Income exceeding ISK 893.713 pr. month 46,24%
Each employee has a personal tax credit of 53.895 ISK per month.
4% of gross income is deducted for private pension insurance and around 1% is deducted for union.
The standard rate of value-added tax is 24% with a reduced rate of 11% for some products.