Lodging tax

A lodging tax (IS: Gistináttaskattur) shall be collected on sales of accommodation/lodging tax units and payment thereof remitted to the Treasury.

A lodging tax unit is the sale of accommodation for up to one day, including overnight, i.e., a premise or area, including on board a cruise ship, that is rented out for the purpose of overnight stays, where sleeping facilities are available or can be arranged, and the rental is generally for a period of less than one month.

Amounts

From January 1st 2025 the lodging tax amounts are as follows:

800 kr./lodging tax unit - For hotels, guesthouses and so forth which have a license in categories II-IV, according to the Act on restaurants, lodging facilities, and entertainment.
400 kr./lodging tax unit - For camp sites and parking spots for motorhomes trailers, pop-up campers and caravan sites.
400 kr./lodging tax unit - For cruise ships on domestic voyages.

Registration

Parties subject to lodging tax must send notification of their business activity to Iceland Revenue and Customs and register in the lodging tax register. To log in a taxable party must use the VAT-password issued to submit VAT reports.

Open registration

Reporting

Those liable for lodging tax must pay lodging tax for each accounting period based on the number of units sold. For VAT-taxable parties each settlement period is two months:

January-February
March-April
May- June
July-August
September-October
November-December

The lodging tax along with a lodging tax return shall be turned in no later than on the fifth day of the second month following a settlement period for transactions during that period. Lodging tax reports are submitted electronically.

To log in, a taxable party must use the VAT-password issued to submit VAT reports.

Infrastructure fee

Operators of cruise ships on international voyages are required to pay an infrastructure fee for each passenger on board the ship for each started day the ship remains in a port within the country or elsewhere in the state's customs territory.

Amount

The infrastructure fee shall be 2.500 kr./passenger - For each started day that the ship remains within the state's customs territory.

Reporting

The settlement period for the infrastructure fee is the time the ship is within the state's customs territory on each occasion. The due date for payment is seven days after the ship leaves the customs territory.

The infrastructure fee along with an infrastructure fee return must be submitted no later than on the due date of the fee.