We are not currently operating in this jurisdiction.
For a full list of countries where we operate, please click below.
For a full list of countries where we operate, please click below.
Iceland
Legal
When looking for a jurisdiction in which to incorporate, the first thing to look at is the legal code. The body of law in Iceland is civil law (german) law. You will want to get some local advice as to how to best structure a company in Iceland. E-signatures are allowed.
The country code IS is for Iceland and the most common legal entity structure in Iceland is a LLC.
The amount you'll have to wait is about 2 weeks to put together the paperwork and file a LLC in IS. The types of consideration you can use to setup your company is most commonly ISK, EUR, USD, and Any legal tender.
Yes, one is allowed to re-domicile a LLC from IS. You are usually allowed to change the jurisdiction of the company, pending certain procedures.
There must be at least 1 shareholder. This makes it possible for you to own a LLC in IS by yourself. Corporate Shareholders are allowed, meaning you could have a company as a shareholder. Foreign ownership is tolerated, up to 33% of the total shareholding.
A company is only required to have 1 director on the board. Moreover, corporate directors are permitted. Directors are disclosed publicly. There is a body of law which requires companies to hold an annual meetings of shareholders.
A registered legal firm must be retained for an address, paid by the company on an annual basis, for a legal services company which can receive litigation or other legal process on behalf of the registered legal entity. Furthermore, a company secretary is not a requirement.
There is an obligation to file yearly tax returns. However, there is oftentimes a requirement to have these accounts audited.
The country code IS is for Iceland and the most common legal entity structure in Iceland is a LLC.
The amount you'll have to wait is about 2 weeks to put together the paperwork and file a LLC in IS. The types of consideration you can use to setup your company is most commonly ISK, EUR, USD, and Any legal tender.
Yes, one is allowed to re-domicile a LLC from IS. You are usually allowed to change the jurisdiction of the company, pending certain procedures.
There must be at least 1 shareholder. This makes it possible for you to own a LLC in IS by yourself. Corporate Shareholders are allowed, meaning you could have a company as a shareholder. Foreign ownership is tolerated, up to 33% of the total shareholding.
A company is only required to have 1 director on the board. Moreover, corporate directors are permitted. Directors are disclosed publicly. There is a body of law which requires companies to hold an annual meetings of shareholders.
A registered legal firm must be retained for an address, paid by the company on an annual basis, for a legal services company which can receive litigation or other legal process on behalf of the registered legal entity. Furthermore, a company secretary is not a requirement.
There is an obligation to file yearly tax returns. However, there is oftentimes a requirement to have these accounts audited.
Taxes
If you want to do business in Iceland, you have to know about taxation for a LLC, which is the most common company type in Iceland.
Iceland taxes corporate income on a worldwide basis. The predominant approximate percentage for income earned abroad, from our research, and this is not personal tax advice, is 20%. IS doesn't have known exemptions to bring in foreign earned profits remitted back. Taxes are reasonable in Iceland because the income corporate tax rate is 20%. This ranks Iceland as 70th overall with regards to corporate tax rate worldwide.
The VAT rate in Iceland is 24.00%, that ranks Iceland as 168th when compared to value added tax rate worldwide. In terms of other taxation, an employer will contribute at least in 15.35% to the equivalent of a social security fund and an employee will contribute 4.00%. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 60 hours. Contributing to this is the number of yearly labor tax payments, which is 13 in IS.
Thin cap rules are not officially enacted. This refers to any type of restrictions on companies' debt-to-asset ratios. Dividends paid to residents are subject to a withholding tax of 20%. However, tax may be reimbursed under certain requirements. Dividends are payments of company profits, passed by the board, to shareholders. Dividends can be issued as stock, cash, or property. Capital Gains are treated as ordinary income and subject to 20% corporate income tax. However, gains derived by a corporation from the sales of shares are not taxable. A capital gains tax is levied on the profits that a corporation or natural person realizes when he or she sells sells a capital asset for a price that is higher than the purchase price.
The interest withholding tax rate is estimated at 10%. This means that the tax authorities expects legal entities to automatically withhold 10% of interest payments to non-residents. The dividends withholding tax rate is 18%. Which means that the relevant tax authorities expects legal entities to automatically withhold 18% of dividend payments offshore. Withholding tax on dividends paid to EEA resident companies may be reimbursed. The royalties withholding tax rate is 20%. Which means that the relevant tax authorities expects entities to pay tax on at least 20% of money remitted abroad on royalty payments. Withholding taxes may be reduced under a tax treaty.
There is no known tax on wealth in Iceland. There are inheritance and real estate taxes in Iceland. We are aware of widely used research and development tax relief in this country.
The above is not tax or legal advice for your company situation. We are able to refer you to a tax advisor in Iceland who can properly advise you. Ready to get started? Click incorporate now if you are in a hurry, or press the free consultation button above.
Iceland taxes corporate income on a worldwide basis. The predominant approximate percentage for income earned abroad, from our research, and this is not personal tax advice, is 20%. IS doesn't have known exemptions to bring in foreign earned profits remitted back. Taxes are reasonable in Iceland because the income corporate tax rate is 20%. This ranks Iceland as 70th overall with regards to corporate tax rate worldwide.
The VAT rate in Iceland is 24.00%, that ranks Iceland as 168th when compared to value added tax rate worldwide. In terms of other taxation, an employer will contribute at least in 15.35% to the equivalent of a social security fund and an employee will contribute 4.00%. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 60 hours. Contributing to this is the number of yearly labor tax payments, which is 13 in IS.
Thin cap rules are not officially enacted. This refers to any type of restrictions on companies' debt-to-asset ratios. Dividends paid to residents are subject to a withholding tax of 20%. However, tax may be reimbursed under certain requirements. Dividends are payments of company profits, passed by the board, to shareholders. Dividends can be issued as stock, cash, or property. Capital Gains are treated as ordinary income and subject to 20% corporate income tax. However, gains derived by a corporation from the sales of shares are not taxable. A capital gains tax is levied on the profits that a corporation or natural person realizes when he or she sells sells a capital asset for a price that is higher than the purchase price.
The interest withholding tax rate is estimated at 10%. This means that the tax authorities expects legal entities to automatically withhold 10% of interest payments to non-residents. The dividends withholding tax rate is 18%. Which means that the relevant tax authorities expects legal entities to automatically withhold 18% of dividend payments offshore. Withholding tax on dividends paid to EEA resident companies may be reimbursed. The royalties withholding tax rate is 20%. Which means that the relevant tax authorities expects entities to pay tax on at least 20% of money remitted abroad on royalty payments. Withholding taxes may be reduced under a tax treaty.
There is no known tax on wealth in Iceland. There are inheritance and real estate taxes in Iceland. We are aware of widely used research and development tax relief in this country.
The above is not tax or legal advice for your company situation. We are able to refer you to a tax advisor in Iceland who can properly advise you. Ready to get started? Click incorporate now if you are in a hurry, or press the free consultation button above.
Country details
Iceland
ISK
Reykjavik
Europe
Icelandic, English, German (Standard), Danish, Swedish, Norwegian
308,910
Tax treaties
Tax treaties Map
Disclaimer
Although we use our best efforts to keep the information of this site accurate and up-to-date, we make no
representations or warranties with respect to the accuracy, applicability, fitness, or completeness of the contents of
this website. We disclaim any warranties expressed or implied, merchantability, or fitness for any particular purpose.
We shall in no event be held liable for any loss or other damages, including but not limited to special, incidental,
consequential, or other damages. The contents of this website are just for illustrative purposes and are NOT to be
considered as a legal opinion or tax advice and should not be relied upon as such. Far Horizon Capital Inc., and any
associated company, is not engaged in the practice of law or tax. If you wish to receive a legal opinion or tax advice
on the matter(s) in this website please contact our offices and we will refer you to an appropriate legal practitioner.
Use of our websites FlagTheory.com, Incorporations.io, Residencies.io, Passports.io, is subject to our
terms and conditions.