Iceland imposes non-resident VAT registration on electronic services

11 October 2011

From 2012, foreign, non-resident companies supplying Icelandic consumers with electronic supplies will be required to register and charge for local VAT.  Iceland VAT is currently 25.5%.

Services include software and epublishers.  There are moves in the EU to reduce the VAT rate on ebooks and publishing.

This new requirement mirrors a similar policy in Norway.  Traders exceeding Icelandic Krona 1 million turnover per annum will have to register with the local tax authorities.  They will then be obliged to charge, record and settle VAT to the local tax authorities.

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