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The Reykjavík City Council has agreed to make momentary amendments to its invoicing rules in accordance with actions in response to the economic crisis in the wake of the COVID-19 pandemic. These rules apply to households and businesses alike, and will be effective as of 2 April until 31 December 2020.
The goal is to increase the flexibility to respond to the current situation, to ensure fair collection of payments, and make sure that penalty interests and other costs will be minimized, while respecting principles of non-discrimination and maintaining the best interest of the city at the same time.
The main change relates to payment deadlines, as the rules contain new provisions on payment deadlines for general claims, for suspension of real estate fees, both general and specific measures, and on suspension of rental payments. It also contains provisions on the distribution of payments of the general claims that have been deferred, and changes in provisions on penalty interest on general claims.
General claims:
- The deadline can be extended for up to 90 days, for up to three claims in each category during the period that these special rules apply.
o This does not apply to fees that must be paid before certain services can be provided by the Department of Environment and Planning.
o In order to partake in these measures, parties concerned must apply byby the following e-mail addresses: upplysingar@reykjavik.is or innheimta@reykjavik.is, or call 411-1111.
- It is possible to request up to 6 months of distribution of payments on general claims, once deadlines on payments have been prolonged in consultation with Momentum, the billing agency servicing the City of Reykjavík.
o Apply for this measure by sending a request to the following email address: momentum@momentum.is
Real estate taxes and property taxes:
- The remaining payments of real estate taxes and property taxes for residential and commercial property, which are due in May to October, will be distributed in the months of May to December. Payments for real estate fees that are not yeat due, will therefore be distributed to 8 months instead of 6 months.
o These changes apply both to residential and commercial housing
o This will automatically take effect
- Businesses may request to postpone up to three due dates for general property taxes and taxes on commercial properties, due to temporary fall in income, until January 15, 2021. This is in line with new law recently issued by the Parliament on measures to meet the economic impact following the COVID-19 pandemic.
o The same conditions for this deferral apply, as for the postponement of public charges which must be applied for at the Icelandic Tax Authorities.
o Companies and businesses that wish to apply for this postponement must send in their request through the following link: https://reykjavik.is/erindi-vegna-fasteignagjalda
o To qualify for this measure, businesses must hand in their application for postponement of public fees with the Tax Authorities beforehand, and submit a receipt of confirmation with their application.
Postponement of rent payments:
- Those who rent properties from the City of Reykjavík can request a suspension of rent payment of up to four due dates, ie. the rental payments due in March, April, May and June.
o The leaseholders must demonstrate at least one-third of income loss compared to the same period in 2019 and submit the relevant data in accordance with special guidelines.
o Leaseholders should apply for this postponement of payments by sending their request to the following e-mail address: esr@reykjavik.is
Penalty interest:
- Penalty interest is calculated on the principal of general claims from the closing date until the date of payment, if claims are settled after the closing date.
o Until now, penalty interest has been calculated on the principal of general claims from the due date to the closing date of payment, should claims be paid after the closing date.
- Penalty interest is calculated on the principal of real estate debt claims from the due date until the payment date, if claims are paid after the closing date.
This is unchanged from before, as due dates, closing dates, and the calculation of penalty interest on them is fixed by law.
The rules apply from 2 April 2020 to 31 December 2020.