The Iceland Revenue and Customs has released the key rates and amounts for 2024, which provides individual income tax changes in 2024.

The key changes in the monthly brackets and rates involving personal income taxes are as follows:

  • Income from ISK 0 – 446,136 per month – 31.48%
  • Income from ISK 446,137 – 1,252,501 per month – 37.98%
  • Income exceeding ISK 1,252,501 per month – 46.28%
  • Children (born 2009 or later) with income exceeding ISK 180,000 per year – 6%
  • Personal tax credit per month – ISK 64,926
  • Personal tax credit per year – ISK 779,112

The above rates also include an average municipal tax rate of 14.93%.

The corporate tax rate changes include the following:

  • The corporate income tax has been adjusted and increased from the standard corporate tax rate of  20% to 21%.
  • The corporate tax rate on entities such as partnerships has been increased from 37.6%  to 38.4%.
  • The tax rate on interest paid to non-residents has been increased from 12% to 13%.

All these tax rate adjustments are temporary and only apply for the 2024 fiscal year and 2025 assessment year.

On 27 December 2023, the Iceland parliament introduced the personal income tax and corporate tax changes in the Act to amend various laws for the 2024 budget (Law No. 100 of 27 December 2023).