Kilometer fee for electric, hydrogen and plug-in hybrid cars

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A kilometer fee must be paid for driving electric cars, hydrogen cars, and plug-in hybrids (cars that run on both electricity and gasoline). The fee does not apply to hybrid vehicles that do not connect to an electrical outlet.

The fee applies to passenger cars and vans.

Fee amount

6 ISK per kilometer for electric cars and hydrogen cars.
2 ISK per kilometer for plug-in hybrids.

Logging the odometer reading

The fee is very similar to how utility bills for electricity and hot water are charged. You log the odometer reading regularly, based on that a plan is made for your average driving and billed according to it until you log again. With each log, a new estimate of average driving is created and at the same time your account is settled for the last period.

The reading can be logged:

on the Ísland.is app
on My pages on Ísland.is
at certified inspection sites during a regular inspections
by making an appointment at an inspection station, Aðalskoðun and Frumherji offer such a service.

Markús bought a new electric car two years ago.

First registration

When registered, the odometer reading of the car was logged as 15 km.
On January 5, 2024, Markús himself logs the odometer reading of the car as 24,140 km.

Based on these records, it is calculated that Markús drives an average of 33 km per day.

First estimate on average driving

Markús receives an invoice for January of 33 km x 31 days x 6 ISK/km = 6,138 ISK. The invoice is due on February 1, 2024.

In the following months, Markús will receive an invoice with a similar amount or until he logs a new odometer reading. He does not have to do it again until 2025, but he can also choose to do it earlier.

New registration

Markús decides to log the odometer reading again on August 23, 2024. The logs shows that he has driven an average of 32 km daily since the last reading, or 1 km less per day than the plan assumed.

Updated schedule

On September 1, Markús receives a plan for August based on the new average of 32 km per day. Plans for the following months are based on this average until new readings are logged.

Settlement

At the same time, a settlement is made for January-July (212 days). Markús then has a credit of 212 days x 1 km x 6 kr/km = 1,272 kr + credit interest, which he gets paid out unless he is in debt to the treasury, in which case the credit goes towards its payment.

The settlement for August is made after Markús's next odometer reading.

- If this was a plug-in hybrid car, the process would be exactly the same, but instead of 6 ISK, the fee for each kilometer would be 2 ISK.

Eva bought a used electric car and has had the car for 6 months.

First registration

On January 2nd., 2024, Eva logs the car's odometer reading for the first time. The reading turns out to be 70,000 km and it is the first reading since Eva acquired the car (the odometer was not read and logged during the change of ownership and the car has not been inspected since she became the owner).

At the moment, therefore, there are not two logs of the odometer to estimate Eva's average driving distance.

First estimate on average driving

She therefore receives an invoice on February 1st., for use in January, which is based on the general average driving of passenger cars in Iceland. That's 14,000 km per year or 38.4 km per day. The amount is therefore 38.4 km x 30 days x 6 ISK/km = 7,142 ISK.

Eva does not have to log the odometer reading again until 2025, but to ensure that the plan reflects her average driving, she can log the odometer reading again soon. As always, 30 days must pass between registrations.

Updated estimate

On March 29th., Eva logs the car's odometer reading again, which turns out to be 73,915 km. It is clear that Eva's average driving during this period (January 2-March 30) is 45 km per day.

Subsequently, payments are based on her average daily driving being 45 km.

Settlement

A settlement for the period January-February is made at the same time. Eva has to pay the difference, 45 km - 38.4 km = 6.6 km for each day of the period. The total amount is therefore 6.6 km x 59 days x 6 ISK/km = 2,336 ISK plus a 2.5% surcharge on an annual basis.

Settlement for March is made after Eva's next registration of mileage.

- If Eva had a plug-in hybrid car instead of an electric car, the process would be exactly the same, but instead of 6 ISK, the fee for each kilometer would be 2 ISK.

Routine readings

The odometer reading should be logged into the system at least once a year.

You may log a reading every 30 days.

Keeping a consistent log ensures that you pay based on average kilometers traveled, which is calculated based on your two most recent odometer readings.

Consistency reduces the likelihood of

overpaying at the end of each month.
receiving an underpayment penalty at your next odometer reading.

A reading that is logged on the last day of the month takes effect the following day.

Amending an incorrect logging entry

If you enter the wrong number, you can re-enter on the same day, and the second number will apply. At midnight, entries will close for the next 30 days.

Payment

The kilometer fee is to be paid monthly. A notice will be sent to the payer's online banking profile. The vehicle owner is responsible for paying the fee, except when the owner is a property- or finance lease, in which case the lessee is the payer.

Payment is due on the first business day of each month, and the final due date is 14 days later.

The first due date is February 1st. 2024.

Amount paid

The kilometer fee is based on the average distance driven. The average driving distance is calculated based on your two most recent odometer readings from the current owner.

You can estimate the cost based on the average distances driven.

Energy source of vehicle

Electric

Hydrogen

Hybrid

Estimated driving in kilometers

per month

If two odometer readings are not available from the current owner, the fee will be based on the following estimate of average driving:

The Directorate of Internal Revenue's average driving estimate

Payer	Average driving per year	Average driving per day
Individual	14 000 km	38.4 km
Company or institution	40 000 km	109.6 km
Vehicle rental	50 000 km	137.0 km
Taxi driver	100 000 km	274.0 km

Settling up

When you log an odometer reading, your account is settled. This settlement constitutes the difference between what you paid based on the estimate and what you should have paid based on actual driving.

If you have:

overpaid, you will receive a refund, and the amount is subject to credit interest. If you owe the treasury, the repayment will be credited toward this debt, regardless of whether the debt was incurred in relation to the kilometer fee or any other fees.
underpaid, you will receive an invoice for the difference with an additional 2.5% surcharge on an annual basis.

Kilometer fee

See all questions

Who is exempt from paying the kilometer fee?

Which cars have to pay a kilometer fee?

I will use my car temporarily in Iceland, what do I have to do?

How do I log the kilometer status?

How is the kilometer fee calculated?

What is a plug-in hybrid car?

I registered the kilometer status on the cars odometer, when does it take effect?

How often do I have to log kilometer status per year?

Do I have to register the number of kilometres for each month?

Why did I get a summon to a reading at a certified inspection office?

Initial reading

Logging the odometer reading by January 20th. 2024 was mandatory.

If this was not completed within the given time frame

a penalty fee of 20.000 ISK was charged after January 30th.
the payer received a notification of an appointment to appear at a certified inspection site after January 30th, where the odometer reading will be logged.

Service provider

Iceland Revenue and Customs