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Increased support for R&D

The Icelandic government announces increased support for R&D in its first Fiscal Strategy Plan 2019-2023. Tax concessions will be increased already 2019 and the ceiling on them will be removed later in the period.

Iceland offers incentives for research and development in the form of tax credits for innovation companies. The aid is granted as a reimbursement of the companies´ paid income tax. The tax credit is 20% of the actual R&D cost with a current annual ceiling of a total actual cost of ISK 300 million for internal R&D or ISK 450 million for R&D cooperation between two independent innovation companies. This support will be increased already next year and the ceiling on the reimbursement removed during the Fiscal Plan period as outlined in the published coalition government strategy.

The government has also announced a reduction in payroll taxes and is seeking new measures to further relieve the general tax burden.

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For further information on the benefits of establishing a business in Iceland please feel free to contact us.

Incentives

Iceland focuses on a favorable business environment, including low corporate tax, availability of land and green energy at competitive prices and efficiency within European legislative framework. New direct investment projects can apply for an investment agreement, ensuring generous regional incentives, including a corporate tax rate ceiling of only 15%.

Why Iceland

Along with having one of the lowest corporate tax rate in Europe, Iceland has a highly educated workforce which is ranked among the highest in the world, offers competitively priced renewable energy with an advanced infrastructure making Iceland an ideal location for investors