This article is about the upcoming tax change for Iceland for the year 2016.

As of 1st of January 2016 new types of tourism services including expeditions, bus tours and travel arrangement will be subject to VAT (VSK).

Iceland VAT for the tourism industry is in two levels, 11% and 24%.

To configure and apply the new Icelandic taxes in your booking system use the following instructions.

Start by selecting the "Menu Icon in top left corner" then you select "Taxes" from the drop down list. 

How to define the 11% VAT

  1. On the Taxes page click ADD at the top of the page, next to the heading.
  2. Put the title e.g. VAT 11% in the Title input field
  3. Accommodation may be subject to the 11% VAT. Please get professional help from Tax Advisors to determine the correct VAT for products. Click the input box right next to Default tax for new: Select e.g. Hotel Room and Hotel room rate.

    Please get familiar with the tax rules at
    RSK's website. Bókun is not an expert on taxes and we recommend that you contact someone who is.
  4. Since Icelandc companies are supposed to display their prices inclusive of VAT, select the checkbox This tax is included in price list prices.
  5. Set rounding mode to half up.
  6. Click Add tax component button.
  7. Put VAT 11% in the Title input field.
  8. Put the value 11 in the Percentage field.
  9. Click the Save button.

It should look something like the following screenshot (click to enlarge)


How to define the 24% VAT

  1. On the Taxes page click ADD at the top of the page, next to the heading.
  2. Put the title VAT 24% in the Title input field
  3. Activity tours, reselling, car-rental and many other services may be subject to the 24% VAT. Please get professional help from Tax Advisors to determine the correct VAT for products. Click the input box right next to Default tax for new and Select if applicable: Activity, Car Rental, Pickup, Transport, Car pickup, Drop off, Car drop off, Pickup and drop off, Extra.

    Please get familiar with the tax rules at
    RSK's website. Bókun is not an expert on taxes and we recommend that you contact someone who is.
  4. Since Icelandc companies are supposed to display their prices inclusive of VAT, select the checkbox This tax is included in price list prices.
  5. Set rounding mode to half up
  6. Click Add tax component button.
  7. Put VAT 24% in the Title input field.
  8. Put the value 24 in the Percentage field.
  9. Click the Save button.

It should look something like the following screenshot (click to enlarge)

Apply Taxes

When you save in the previous step you are forwarded to the "Apply taxes" tool. Here you apply the new tax to your existing products.

Future products will get taxed automatically as you defined before.

From this list, select the products that your new tax is applicable to. If you want to select all products select the check box at the top of the list.

On this list you can always manually apply and remove tax rules from your products.

Remember to save your changes.

Please note that you can find further information on these links: 

http://www.saf.is/helstu-breytingar-a-vsk-og-vorugjoldum/

https://www.rsk.is/atvinnurekstur/virdisaukaskattur/ferdathjonusta/

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