Private pension savings for property purchases or loans

No, the allocation of private pension savings under this program is not limited to the applicant's first property. It allows for tax-free allocation of private pension savings towards a loan and tax-free withdrawal for property purchases.

However, for comparison, see the similar program offering support for first-time homebuyers.

The private pension fund must make payments at least four times a year in accordance with the application. Generally, contributions are paid towards the loan within 40 days after they are received by the fund. However, this may vary between funds, and shoud contact the pension fund if there are any questions about payments and their frequency.

Skatturinn does not have information on where or whether individuals are contributing privat pension savings contributions.

Check if this is indicated on your payslip or contact your employer.

The Loans that appear on the list are those included in section 5.2 of the most recent tax return.

Section 5.2 on the tax return is for loans taken to acquire a residence for personal use.

• If your loan is not on the list, it is because it was not reported in section 5.2 of the most recent tax return.

• If the loan was taken during the current year, it might not appear on the most recent tax return.

• If the loan was taken for renovations to the property or for purposes other than acquiring a residence for personal use, it should be listed in section 5.5 of the tax return.

You can manually register a loan to the list by selecting "Skrá lán" a loan in step 2/3 of the application.

No, when utilizing this general program to allocate private pension savings contributions towards a loan, it is only possible to do so by reducing the loan principal. (Reducing the principal will then affect future payments.)

However, it is permitted to make payments towards installments of non-indexed loans in connection with the purchase of a first home.

For more information about purchasing a first home.

Yes, it is possible. Individuals can make payments towards a loan held by their partner if the cohabiting partners meet the conditions for joint taxation.

You can therefore use your private pension savings to make payments towards a loan taken by your partner for property purchases, even if you are not listed as the property owner or as the borrower of the loan.

There can be various reasons why monthly allocations stop. Common causes include:

• The loan was rejected by the lending institution.

• You have reached the maximum amount for the year; allocations will resume in the new year.

• You have changed jobs, and the new employer is not contributing to the private pension fund.

• The allocation was not renewed.

An application for utilizing private pension savings towards a loan only applies to savings contributed after the application is submitted. If you are no longer making monthly contributions, private pension savings will not be allocated towards the loan under this program.

Only savings accumulated during the period from July 2014 to December 2025, when the applicant does not own a property, may be withdrawn. If you have been a property owner for a long time, it is possible that you may not be eligible to withdraw accumulated private pension savings.

The purchase of a housing right is considered the acquisition of a residence under the law. Therefore, it is always possible to withdraw accumulated private pension savings for the purchase of a housing right, subject to other conditions.

If you wish to make additional payments towards a loan for the purchase of a housing right, the loan must be secured by a mortgage on a property.