A VAT refund guide to Iceland
Which countries have reciprocity with Iceland?
Learn more about how reciprocity works within VAT by clicking below.
What expenses are claimable in Iceland?
Entertainment
Events
Travel Related
General Expenses
Additional Information
| Current VAT Rate | 24% |
| Categories | Entertainment, Events, Travel Related, General expenses |
| VAT in local language | Virðisaukaskattur (VSK) |
| VAT number format | IS123456 (IS followed by 5 or 6 digits) |
| Exemptions | Entertainment, Food, Drink and Restaurant Services, Hiring of means of transport, Fuel, Public Transport |
| Key Deadlines | 30th June |
| Threshold |
Non-Simplified: More than EUR 40 (including VAT) Simplified: EUR 40 or less (including VAT) Super Simplified: Not applicable to this VAT scheme |
| Electronic Invoicing | Currently, electronic invoicing is mandated for B2G transactions and voluntary for B2B transactions at the buyer’s request |
Frequently Asked Questions
1. What is the typical processing time for a VAT refund in Iceland?
Processing times for a Iceland VAT refund can vary. Businesses reclaiming a VAT refund in Iceland can expect it to take anywhere from a few months to a year, depending on the claim complexity and submission accuracy.
2. Will original invoices need to be submitted in a VAT refund claim in Iceland?
Yes, only original invoices are allowed for an Iceland VAT refund and copies of invoices are not accepted for a VAT refund in Iceland.
3. By when should VAT refund claims be submitted in Iceland?
The deadline for annual Iceland VAT refund claims is 30 June. However, the Iceland VAT Authority allows for claims to be made for a period of 2 months, which must be submitted at least 15 days after the end of the relevant period. Additionally, invoices can be claimed in a VAT refund in Iceland for a period up to 6 years from the invoice date.
4. Should the VAT refund claim in Iceland exceed a threshold before it can be submitted?
Iceland VAT refund claims made during the year should exceed ISK 71,500.00 (approximately EUR 400.00), whilst annual Iceland VAT refund claims should exceed ISK 13,900.00 (approximately EUR 77).
5. Can a businesses reclaim VAT in Iceland on all goods and services?
Businesses that are not established in Iceland, and is not registered for VAT in Iceland (thus not having an Iceland VAT number) that also does not make taxable supplies in Iceland would be eligible for a VAT refund in Iceland. The following goods and services can be claimed in an Iceland VAT refund: taxi fares; accommodation expenses; admissions to and participation in fairs and exhibitions and other general business expenses (e.g., office expenses, marketing costs etc).
6. Which documents need to be submitted as part of VAT refund claims in Iceland?
Along with the copies of the invoices, an Iceland VAT refund application should also include documents for your appointed agent (if applicable – e.g., if you have appointed VAT IT as your agent), a completed claim form and a valid tax certificate.
Explore VAT reclaim opportunities in
Nearby Countries
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Ireland
Norway
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