Iceland vs Australia
Tax Rate Comparison
Enter your income below for a personal tax estimate, then scroll down for full rate breakdowns.
๐ฐ Personal Income Tax Calculator
Enter your income to see your estimated annual tax liability in each country โ side by side.
๐ฎ๐ธ Iceland โ Municipal Income Tax
Iceland's 69 municipalities set their own local income tax rates, ranging from ~12.44% to ~14.52%, averaging ~14.45%. This is added to the national income tax. The combined effective rate for most earners is about 36.94% (national + municipal). Iceland has no inheritance tax on direct heirs. Real estate transfer tax (stimpilgjald) is 0.8% on property transfers. Iceland is not an EU member but belongs to the EEA, affecting VAT and trade rules.
๐ฆ๐บ Australia โ State & Territory Taxes
Australia's 6 states and 2 territories levy payroll tax (4.75%โ6.85%), stamp duty on property, and land tax on investment properties. There is no state income tax โ income tax is federal only. The Stage 3 tax cuts (effective July 2024) restructured brackets significantly. The ACT is progressively replacing stamp duty with broad-based land value tax. Councils levy rates on property owners.
Iceland vs Australia: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ฆ๐บ Australia has a higher top income tax rate (~36.94% vs 0โ45%). ๐ฎ๐ธ Iceland is more favourable for high earners.
๐ VAT/Sales Tax: Iceland has a higher consumption tax (11โ24% vs 10%).
๐ข Corporate Tax: ๐ฎ๐ธ Iceland offers a lower corporate rate (20% vs 30%), which can influence business location decisions.