Limited right to use private VAT motor vehicles
The owner of operations or staff is permitted to use the private use of a VSK automobile if the operator notifies the Icelandic Tax on the intended private use before it begins. If this is done, the operator's tax permission will not be affected when acquiring the vehicle.
The term "restricted personal use" consists merely of driving between the home of the holder of the right of use and the place of business.
The following conditions must be met for the exemption:
The right of use of an owner or employee is fully included in the tax assessment of tax-related turnover at the tax price due to the limited use of the wage payer's vehicle by a wage earner.
Before private use begins, or changes in such use occur, the operator notifies the Icelandic Tax on the intended use.
On deduction and remittance of withholding of public levies, the operator (employer) considers to the employee the benefits provided by the right to use.
Service provider
Iceland Revenue and Customs