You can have your value added tax (VAT) refunded at Keflavík Airport at Arion bank wich is located in the arrivals hall of the airport. Passengers are to fetch their refund before checking in and must be ready to show the goods for which they are claiming a refund. Opening hours match flight schedules.
Rules on VAT refunds
Value added tax (VAT) may be refunded to parties with permanent residence overseas for goods they have bought in Iceland, provided the conditions of the regulation are met.
Conditions for reimbursement according to regulation are that the purchaser of the goods has permanent residence in a country other than Iceland. As proof of permanent residence overseas, the purchaser must submit his passport or other ID that provides proof of domicile in another country. Foreigners with permanent residence in Iceland are not entitled to VAT refunds according to the regulation.
All the following conditions must be met in order to receive a refund.
- The purchaser must take the product with him out of the country within three months from the date that the product was purchased.
- The purchase price of the item including VAT must be at least ISK 6,000.
- The item must be shown together with the requisite documentation on departure.
VAT may be refunded on goods on the same receipt if their total purchase price is ISK 6,000 or more, including VAT, even if one or more items does not reach the requisite minimum amount.
On departure from Iceland through Keflavík International Airport, the buyer shall present the goods, together with the reimbursement documentation, to the refunding entity, who will execute the refund, provided that the conditions set in the regulation are met in other respects. The refunding entity may not refund the VAT unless the buyer can provide adequate evidence of permanent residence overseas.
Few things to keep in mind...
- The buyer needs to be a resident of another country
- The buyer brings the goods out of the country within three months from the purchase date
- The purchase price of the goods with VAT is a minimum of ISK 6,000
- The buyer needs to be able to produce the articles at departure
- The buyer of the articles is the one daparting