The Icelandic Krona
The Icelandic krona is the sole legal tender in Iceland. Iceland is a member of the European Economic Area. Iceland is not a member of the European Union and does not use the euro.
Cards vs Cash
Roughly 97 to 98 percent of transactions in Iceland are made electronically rather than in cash, according to the European Payments Council. Visa and Mastercard are accepted at the large majority of shops, restaurants, fuel stations, and tour operators across the country. American Express is accepted at many larger hotels and restaurants in Reykjavik but is not universally accepted outside the capital. Contactless card and mobile wallet payments are widely supported at point-of-sale terminals in Iceland.
ATMs and Getting Cash
Iceland has approximately 200 ATMs nationwide, concentrated in Reykjavik and larger towns such as Akureyri, Selfoss, and Egilsstadir. ATM withdrawals in Iceland typically carry a fee, charged either as a flat amount or a percentage of the withdrawal.
VAT and Tax-Free Shopping
Iceland applies a standard VAT rate of 24 percent on most goods and a reduced rate of 11 percent on items such as food and books. Non-resident visitors are eligible for a VAT refund on qualifying purchases through Iceland's tax-free shopping scheme. The Icelandic tax authority, Skatturinn, sets a minimum single-receipt purchase amount that must be reached to qualify for a tax-free refund. Tax-free refund forms must be validated by customs or an approved refund operator at the point of departure, such as Keflavik Airport. The VAT refund calculator works out whether a receipt clears the minimum and what the refund is realistically worth, which is materially less than the headline VAT rate once the operator's commission is taken.
Planning Your Spending
Use the Trip Budget Calculator to help plan your trip.
Compare Tour Options in Reykjavik
You can compare Reykjavik tours to see the current options.
