Europe · ISK
Iceland For Solopreneurs - Tax, Immigration, Lifestyle
Reviewed 2026-06-21
Top income tax
46.29%
Self-employed SS
Yes
VAT
24%
Capital gains
22%
Exit tax
No
Nomad visa
Yes
53
/ 100
Tax efficiency29
Ease to enter72
Ease to exit65
Cost of living47
Internet95
English100
Iceland taxes residents on worldwide income with a three-band progressive system that combines national rates with a municipal income tax, reaching roughly 46% at the top. Capital income is taxed at a flat 22%, VAT is high at 24%, and there is no wealth tax, though a 10% inheritance tax applies. Solopreneurs face mandatory pension and social security contributions and a high cost of living, but benefit from fast fiber internet, strong English use, and a remote worker long-term visa for stays up to 180 days.
Personal income tax
Income tax structureProgressive
Top income tax rate46.29%
Entry income tax rate31.49%
Top rate threshold$131,000
Taxation basisWorldwide
Local/state income taxYes
Social security
Self-employed social securityYes
Employee SS rate4%
Employer SS rate6.35%
Indirect & other taxes
VAT standard rate24%
Capital gains rate22%
Long-hold CGT exemptionNo
Wealth taxNo
Inheritance/gift taxYes
Inheritance top rate10%
Property taxNo
Exit & residency
Exit taxNo
EU/EEA deferralNo
Days to trigger residency183 days
Corporate
Corporate income tax rate20%
WHT on dividends22%
CFC rulesYes
Incentives & special regimes
Special expat regimeYes
Expat regime nameExpert/foreign specialist relief (25% of income exempt for first three years)
Immigration & setup
Digital nomad visaYes
DNV monthly income requirement$7,800
Entrepreneur visaNo
Ease of setup4 / 5
Lifestyle
Cost of living index89
Internet speed404 Mbps
English proficiencyHigh
Civil liberties95
Digital nomad visa
Iceland runs the Long-term Visa for Remote Workers, which lets you live here legally while earning from clients or an employer abroad. You need to prove $7,800/mo.
ProgramLong-term Visa for Remote Workers
Income requirement$7,800/mo (ISK 1,000,000/mo (~USD $7,800); ISK 1,300,000 (~USD $10,140) with spouse/dependents)
DurationUp to 180 days per visa (may be renewable)
Application fee$95 (ISK 12,200 (~USD $95) for long-term visa application)
Familyspouse and children under 18
What you need to qualify
- remote work for foreign employer
- minimum monthly income ISK 1,000,000 (~USD $7,800)
- permanent employment with foreign company
- valid health insurance
- proof of monthly income documentation
- application form L-802 submission to Directorate of Immigration
Verified 2026-07-17 · high confidence
Sources
- PwC Worldwide Tax Summaries — Iceland Individual: Taxes on personal income
- PwC Worldwide Tax Summaries — Iceland Individual: Other taxes (VAT, social security, inheritance)
- PwC Worldwide Tax Summaries — Iceland Corporate: Taxes on corporate income
- Directorate of Immigration (Utlendingastofnun) — Long-term visa for remote workers
- SSA — Social Security Programs Throughout the World: Europe, Iceland (self-employed)
Informational only. Nothing here is tax, legal, or financial advice. Tax rules change often and vary by personal circumstance. Verify every figure against an official source and a qualified adviser before acting. Figures are re-expressed from public sources and cited per country.