Iceland — Property: Property Taxes

Why this matters

Understanding the associated fees is crucial for budgeting and financial planning.

Key facts

• Stamp duty is 0.8% of the registered property valuation for an individual buyer and 1.6% for a legal entity, and a first-time residential buyer pays half.
• Documents must be registered with the District Commissioner within two months of signing, or a stamp fine of up to 10% of the duty is added; appeals go to the State Internal Revenue Board within three months.
• The registration fee is ISK 3,800 per document, and two witnesses must certify the date, signatures and the parties' financial competence.
• The property valuation (fasteignamat) combines land and house values based on market data from February of the prior year, and owners are notified in June through island.is.
• Municipalities use the valuation to calculate property taxes, the District Commissioner uses it for stamp and inheritance tax, and owners can request a revaluation, normally decided within 5 business days.

Steps

1. Registering Property — Ensure all necessary documents are gathered and submitted to the Land Registry Office.