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Iceland COVID-19 VAT measures

  • Oct 24, 2020 | Richard Asquith

24 Oct, VAT payment deadlines on returns have been delayed: Sept filing payment now due 5 Nov; Sept & Oct bi-monthly filers and Oct filers now due by Dec 7.

31 Aug, The July VAT return payment deadline has been delayed until 7 September. The August return remittance deadline is extended to 5 October. Taxpayers reporting bi-monthly for the two months need not submit a payment until 5 October. There will be no penalites for these delayed deadlines.

9 July, May filings payment deadlines have been extended to first week of August. First week of September for May & June bi-monthly payments. Same for the June filing payments - first week of September.

23 April - VAT on 6 April due returns should be paid by 6 May to avoid interest. No penalties will apply for the rest of the year. VAT deductions on residential constructions or rentals will be 100% deductible. 

19 April - the Jan and Feb return payment has been extended again. This time to 15 May.

6 April update - Iceland has agreed Value Added Tax and other tax benefits for businesses during the coronavirus epidemic.

Measures include: 

  • Update 6 April - the VAT return deadline for January and February payments has been moved from 6 April to 16 April.
  • Deferred tax filings and payments until 15 January 2021 on application
  • Limited any fines or late payment interest
  • 100% VAT refunds up until 31 December 2020 for the building sector
  • Suspension of Accommodation Tax until the end of 2021. Taxes already collected this year are not due until February 2022.

There are a number of other tax reliefs. Follow Avalara’s live global coronavirus Covid-19 VAT measures tracker.

Explore more content like this in our Building for COVID-19 recovery hub

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VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is the former VP Global Indirect Tax at Avalara
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