Iceland Tax Agency Announces Individual Wage Withholding Tax Rates for 2026

The Icelandic Directorate of Internal Revenue Jan. 5 announced the individual wage withholding tax rates for 2026. The announcement includes the withholding rates of: 1) 31.49 percent on income up to 498,122 Icelandic kronur (US$3,946); 2) 37.99 percent on income between 498,123 kronur (US$3,947) and approximately 1.4 million kronur (US$11,094); 3) 46.29 percent on income over approximately 1.4 million kronur; and 4) 6 percent for children born in or after 2011, on annual income over 300,000 kronur (US$2,376). The announcement also includes the 869,898 kronur (US$6,892) personal tax credit for 2026, 6.35 percent social security tax, and 5.5 percent financial ...