In Iceland, all employees are subject to state and municipal income taxes. Residents are also subject to contributions to the Construction Fund for the Elderly and a specific charge to the Icelandic National Broadcasting Service.
Residents are taxed on worldwide income but can apply for credit for taxes paid to other countries. Non-residents are taxed on Icelandic-source income only.
Income earned in the 2010 calendar year is assessable in the 2011 taxation year.
The official currency of Iceland is the Icelandic Krona (ISK).
Herein, the host country refers to the country to which the employee is assigned. The home country refers to the country where the assignee lives when he/she is not on assignment.