Payments shall amount to 80% of the average of the total wages or salary or the calculated consideration for a given period. However, payments may not exceed ISK 600,000. Information on minimal payments.
Payments can be estimated by calculating through Parental Leave Fund calculator.
The first payment shall take place at the beginning of the month after parental leave starts.
Employees
Payments amount to 80% of the average total wage.
The period used for calculations is a 12-month period ending six months before the child's birth month or the month when the child enters the home at the time of initial adoption or permanent foster care.
Example:
The date of birth of a child is 1 December August 2022. The period for calculating maternity/paternity leave payments shall then be 1 June 2021 to 31 May 2022.
Self-employed
Payments amount to 80% of the average calculated consideration on which an insurance premium has been paid.
The period used for the calculations is the income year preceding the year of the child's birth, or the year when the child enters the home at the time of initial adoption or permanent foster care.
Example:
The date of birth is 1 December 2022. The period used in calculating maternity/paternity leave payments is 1 January 2021 - 31 December 2021.
Employees who also work independently
Payments amount to 80% of the average total wages and calculated remuneration of which a security tax has been paid.
If a worker has a job proportion of 50% or higher, the calculation shall be based on the worker's reference period.
If a worker has less than 50% employment, the calculation shall be based on the reference period of self-employment.
Impact of other benefits on maternity/paternity leave payments
The following rules apply to the rights of expecting parents:
A parent who receives payments from the Unemployment Insurance Fund under the Unemployment Insurance Act may not, during the same period, exercise his/her right to a maternity/paternity grant, payments from the Maternity/Paternity Leave Fund or parental leave under the Act.
A parent who receives per diem benefits under the Social Security Act on accidents, per diem benefits under the Health Insurance Act or rehabilitation pension under the Social Assistance Act may not during the same period exercise his/her right to a maternity/paternity grant or payments from the Maternity/Paternity Leave Fund under the Act.
A parent who receives payments under the Act on Payments to Parents of Chronically Ill or Severely Disabled Children may not, during the same period, exercise his/her right to a maternity/paternity grant or payments from the Maternity/Paternity Leave Fund under the Act.
A parent who receives holiday pay or payments due to retirement cannot exercise his/her right to a maternity/paternity grant or payments from the Maternity/Paternity Leave Fund under this Act during the same period as those payments apply.
Payments from other countries in connection with the same birth, adoption or permanent foster care of a child and for the same period shall be deducted from payments from the Maternity/Paternity Leave Fund and from payments of maternity/paternity grants. The application must be accompanied by documentation confirming the rights, payment periods and amounts.
Service provider
Directorate of Labor