Property rates

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Property rates are levied annually on all real estate property, unless exempt by law, and the current owner is always responsible for their payment. Real estate property is considered to be a restricted part of land, together with its organic and inorganic parts, the rights attached thereto, and the structures permanently attached to the land.

About property rates

Property rates comprise property tax, land rent, waste collection fees, and recycling center fees. The City of Reykjavík's Department of Finance and Risk Management handles the assessment, invoicing, and collection of the fees.

Until 2010, water and sewerage fees were collected as part of property rates, but Veitur is now entirely responsible for their assessment and collection.

Calculation of property rates

  Residential housing Commercial properties
Property tax 0.18% of the property valuation of the house and land 1.60% of the property valuation of the house and land
Land rent 0.20% of the land valuation 1.00% of the land valuation

Information

The City of Reykjavík's Department of Finance and Risk Management provides information on the assessment of property rates and changes to them by calling 411 1111. Simple enquiries can be sent to fasteignagjold@reykjavik.is. You can also submit a case concerning property rates.

Please note that owners can access assessment notices on Reykjavík Online or Ísland.is. Assessment and amendment notices are not mailed out due to an amendment made to Act No. 4/1995 that went into effect on January 1, 2019, allowing municipalities to deliver assessments for property tax electronically.

Property tax assessment

The property tax assessment is carried out according to Chapter II of Act No 4/1995 on Municipal Revenue. Municipalities are required to levy property tax on all properties valued as a part of the property valuation on December 31 of the preceding year according to the Register of Properties. Property tax is levied on new plots of land and structures in proportion to the annual assessment from the end of the month after they are registered and assessed in the Register of Properties, unless they are specifically exempted from property tax by law. Property tax is waived at the end of the month after the structure is deregistered from the Register of Properties.

The basis for the assessment of real estate tax is the property valuation. Property tax is calculated as a percentage of the property valuation based on the registered use of the property.

Property valuation

The property valuation includes both the house and the land, and is divided into house valuations and land valuations. Registers Iceland reassesses the registered valuation of all properties on May 31, each year. This price is considered the property appraisal value from and including December 31 of that year until the same time the following year, unless a special appraisal is made.

Registers Iceland is required to inform each municipality and owner of the results of the reassessment no later than June each year. The owner has one month from the announcement of the decision to provide comments. Both current and planned property valuations can be viewed on the website of Registers Iceland.

Property registration

Properties, their parts, and individual structures must be recorded in the Register of Properties according to law. Changes in the registered use of the property require a building permit from the Office of the Building Commissioner. You can request a building permit on the website of the Building Commissioner.

A-tax category 0.18% of property valuation

Dwellings and residential buildings with land rights, rural copyholds and land holdings, outbuildings and structures on agricultural holdings, stables, all benefits, and summer cottages as well as land rights.

B-tax category 1.32% of property valuation

Medical institutions under the Health Service Act, schools, dormitories, preschools, gymnasiums, and libraries.

C-tax category 1.60% of property valuation

All other real estate property, such as industrial, office, and commercial buildings, aquaculture installations, hunting lodges, and structures used for tourism.

Land rent

Land rent is charged on all leased lots as a percentage of the lot share assessment. The rental fee for residential land is 0.2% of their land valuation and 1.0% for commercial land.

The Office of Property Management and Industrial Development, Reykjavík City Hall, Tjarnargata 11, provides all information on the renewal and changes to land leases by phone at 411 1111. You can also get information by sending an email to info@reykjavik.is.

Waste management fee and recycling facility fee

A waste management fee and recycling facility fee is imposed in accordance with Article 11 of Act No 55/2003 on Waste Management and Article 25 of Act No 7/1998 on Hygiene and Pollution Prevention. The fee is based on the number and size of containers per building, how often they are emptied, and the type of waste. In multi-owner buildings, the fees are divided according to the ownership percentage of the joint holdership in question cf. Articles 43 and 45 of Act No 26/1994 on Multi-Owner Buildings.

 

Inquiries

Simple inquiries can be sent to fasteignagjold@reykjavik.is.