The representative shall keep complete VAT accounts for the foreign company's supply in Iceland (both purchases and sales), and is obliged to keep these accounts, sales documents, vouchers etc. Payment may be made directly to the foreign business. It is not necessary for the payment from an Icelandic customer to be made through the foreign company's representative in Iceland. The foreign taxable company and its representative are both responsible for the collection and payment of VAT. If a foreign company selling taxable services in Iceland does not have a permanent establishment in Iceland, it must entrust an agent domiciled in Iceland to serve as its representative, including sending notification of its activities to the RSK, collecting VAT on taxable services and remitting it to the Treasury. busses or car rentals, must register for VAT, charge and deliver VAT to the extent that their activities are VAT-related. For example, foreign companies involved in commercial transportation in Iceland, e.g. Registration of a foreign taxable persons in the VAT register carries the same rights and obligations as registration of an Icelandic company. Foreign taxable personsįoreign taxable persons selling taxable goods and services in Iceland are liable for VAT according to the same rules and regulations as Icelandic companies and shall be registered for VAT if the conditions for registration are met. The registration duty does not apply to employees. Is available to certain foreign companies.Įxempt from the obligation to register for VAT are those who sell labor and services that are exempt from VAT and those who sell taxable goods and services for 2.000.000 ISK or less in each twelve-month period from the beginning of their business activity (was 1.000.000 ISK before January 1 st 2017). VOES (VAT on Electronic Services) is a simplified VAT registration that Once they have registered they will be given a VAT registration number and a registration certificate. They are obliged to complete a registration form RSK 5.02 and submit it to the Directorate of Internal Revenue. In general, all foreign as well as domestic companies and self-employed business owners selling taxable goods and services in Iceland needs to register their business for VAT. Those who are selling goods and services in Iceland must declare and pay VAT, 24% or 11%, which must be added to their price of the goods and services they are selling.
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