Working in Iceland

 

Iceland is a Nordic island nation nestled in the middle of Norway and Greenland that runs entirely on renewable energy. Despite the significant hit it took during the 2008 worldwide financial crisis, it remains one of the most favoured destinations of expats who want to work in Europe. 

This small Nordic country remained resilient and managed to slowly, but surely recover from the severe 2008 financial blow, finishing off with a total Gross Domestic Product of USD 20 billion in 2016.  From being reliant to the fishing and export industry, Iceland shifted its gears to geo-thermal and hydropower sources which captured the attention of foreign investors. Furthermore, compared to other nations, Iceland also has a free-market economy and low taxation rate; two of the desirable reasons why expats choose to seek employment in its lands. 

Iceland’s Major Industries 

The leading industry in Iceland is the fishing sector that contributes about 40% of the total export earnings and is responsible for about 5% of the country’s overall workforce. 12% of Iceland’s total GDP comes from the fishing sector while another 5.4% comes from the agriculture industry that produces major products such as potatoes, dairies and green vegetables. 

Iceland is reputed as one of the largest providers of electricity in the world which focuses primarily on the utilisation of hydroelectric and geothermal power. Expatriates who have work experience in the manufacturing sector, particularly on the production of power-intensive products, have high employment chances in Iceland. Other growing industries in the country that foreign assignees will find interesting are: 

  • Service
  • Software production
  • Biotechnology
  • Finance
  • Banking
  • Healthcare
  • Tourism

Average Salary and Work Hours 

As of 2015, wages in Iceland increased to USD 4,880 (553,000 ISK) from USD 4,510 (511000 ISK) last 2014. The monthly (gross) minimum wage in the country for a full-time adult employee that is aged 23 years and above should be USD 1,888.04 (214,000 ISK). As with other countries, the average salary varies depending on the company, sector or industry and skill set of the employee. Below are some of the jobs in Iceland along with their average monthly wages: 

Health and Medical

ISK 350,000 or USD 3,200

Food/Hospitality/Tourism

ISK 380,000 or USD 3,470

Engineering

ISK 512,450 or USD 4,680

Information and Technology

ISK 590,000 or USD 5,400

Science and Technical Services

ISK 500,000 or USD 4,600

Factory and Manufacturing

ISK 720,000 or USD 6,575

In Iceland, work hours are long compared to other European countries where employees tend to work on an average of 1,697 hours in a year. Men usually spend 47 hours weekly on work while women are on an average of 37 hours to be able to meet the country’s expensive cost of living. However, according to Iceland’s labour law, no employee shall exceed 48 hours per week (including overtime) and should be entitled to 11 hours of continuous rest during every 24-hour period. 

Income Tax in Iceland 

All individuals residing and have gainful employment in Iceland are subject to having their income taxed. Expatriates must have a Kennitala or a unique, national identification number as well as a tax card from the Directorate of Internal Revenue. Income tax in Iceland is levied at Workers in the small European state are taxed under a progressive tax system where higher income-earners pay a higher tax rate. Below are the income tax rates that are currently being implemented in Iceland: 

Taxable Income in Iceland Krona (ISK)

Tax Rate (%)

0-241,475

37.32

241,426-739,510

40.22

739,510 and above

46.22

 

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