Iceland Online VAT Registration Now Available via Tax Authority Website

April 12, 2025

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At the end of March, the Icelandic Tax Authority announced that the online VAT and payroll registration is available through the Tax Service website. The announcement on the Tax Authority website includes essential information for individuals and businesses that want to register for VAT, such as where they can access the application and which documents are needed to complete registration.

After releasing the regulation on the obligation of digital platform operators to report on the rental of real estate and movable property and the sale of goods and services, this is the second important announcement in the past month, which showcases the government's efforts to modernize tax-related services and the overall tax system.

Implications for Taxable Persons

Individuals who want or need to register for VAT can access the application on the dedicated Tax Service website after logging in with their electronic ID or web key. Businesses can acces the registration portal by logging in using the website or the delivery key of the company, or by using the electronic credentials of someone who holds power of attorney for the company.

Newly established companies that do not have access to the login credentials may submit a request for a web or delivery key by contacting the Tax Authority.

Taxable persons must provide reports and returns for the overdue periods if the application refers to retrospective registration, that is, registration with a backdated effective date. Additionally, if expenses in the first 12 months are higher than income, the taxable persons must submit an itemized operating budget with the application as supporting documents.

Conclusion

The online VAT and payroll registration system should simplify the registration process for individuals and businesses. However, taxable persons, especially those who submit backdated registration, must be aware of the requirements to provide supporting documentation for overdue periods. All taxable persons who complete the online registration process will receive a confirmation in the government portal's Digital Inbox.

Source: Iceland Tax Authority, VATabout

Who can use the Iceland online VAT registration system?

Both individuals and businesses can use the system, provided they have the necessary electronic credentials or delivery keys to log in.

Where do I access the online VAT registration for Iceland?

You can access the application through the Icelandic Tax Authority's website by logging in with your electronic ID, web key, or delivery key.

What documents are required for VAT registration in Iceland?

Applicants must provide supporting documents like an itemized operating budget if expenses exceed income in the first 12 months or if applying retrospectively.

What is retrospective VAT registration, and how does it affect me?

Retrospective registration means registering with a backdated effective date. This requires submitting reports and returns for any overdue tax periods.

How do newly established companies register if they lack login credentials?

They must request a web or delivery key by contacting the Icelandic Tax Authority directly.

How will I know if my VAT registration in Iceland is approved?

Once the registration is completed, a confirmation will be sent to the applicant's Digital Inbox on the government portal.

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