What it costs and what the law requires to employ someone in Iceland through an EOR, with every figure cited to a primary source.
To employ someone in Iceland, an employer pays ~17.85% (social security charge (tryggingagjald) 6.35% on gross salary plus the mandatory pension fund contribution of 11.5% from the employer, against 4% from the employee)↗ in mandatory contributions on top of gross salary, must give 24 working days↗ of paid annual leave, and 1-3 months by tenure (statutory); up to 6 months under some collective agreements↗ of notice to terminate. An EOR lets you hire here without your own legal entity.
Every figure links to the page that states it. This page's figures were read at their sources between Aug 18, 2026 and Oct 30, 2026, and every cited page is checked again each week (how we verify).
Ranked the way Get matched ranks a hire: employing through its own entity in Iceland, a lower published fee and no deposit, each read from the provider's own pages. A provider whose referral program pays us carries a labeled referral boost, and the few providers we do not work with are listed below, never among these three.
Its own pages also state: equity for employees, laptops and equipment.
Its own pages also state: laptops and equipment.
Its own pages also state: no minimum headcount, laptops and equipment.
For BestEOR readers: 1 month free on your first EOR hire↗ (EOR and employer fees only; visa fees not included; deposits still required), on RemoFirst's page for BestEOR.
Set team size or visa need, and get quotesStill looking for the person? Ask for candidates tooHow referral programs affect ranking
Companies hiring remotely for a role that must be based in Iceland need someone employed there. Without an entity of their own in Iceland, an employer of record is how they do it.
Iceland ranks #163 of 177 countries↗ for full-time remote jobs open only to its residents. Most hired fields: AI Safety.
Counted daily from job postings on Himalayas, a remote job board: a job counts for a country when it accepts applicants based only there. Counting began Oct 29, 2026; a job posted before then counts if it was still open that day. Last updated Nov 11, 2026.
The statutory employer contributions that sit on top of gross salary, each cited.
Rates are the statutory employer contributions; the total employer burden in Iceland is ~17.85% (social security charge (tryggingagjald) 6.35% on gross salary plus the mandatory pension fund contribution of 11.5% from the employer, against 4% from the employee)↗. Confirm the current rates for your case before hiring. Compare employer costs in every country. Compare employer pension contributions in every country.
The full cost to employ combines gross salary, the statutory employer burden, and the EOR provider's own service fee.
The total cost to employ someone in Iceland through an EOR is their gross salary, plus ~17.85% (social security charge (tryggingagjald) 6.35% on gross salary plus the mandatory pension fund contribution of 11.5% from the employer, against 4% from the employee)↗ in mandatory employer contributions, plus a per-employee service fee from the provider. Across the 56 of 93 providers that publish a fee, the median is $349/employee/month (from $99 to $740); the rest quote per country.
This illustration applies the representative rate to the full salary. It does not apply contribution caps, local-currency thresholds or employee eligibility rules, so it is not a payroll quote. Actual cost depends on the salary, the provider, and country-specific quotes; some countries also add mandatory items such as 13th-month pay or severance accruals. Run your own numbers in the calculator.
Each provider below names Iceland on its own website as a country where it offers Employer of Record. Cheapest published starting fee first.
23 providers name Iceland on their own websites as a country where they offer EOR. Published starting fees among them run from $199 /mo↗ (RemoFirst, Skuad (Payoneer), Tarmack and 1 more) to $699 /mo↗ (Oyster HR and Safeguard Global); 6 quote Iceland on request.
Not sure which one fits? We rank these providers for your team size and visa needs, and get you quotes from the ones you pick.
Get matchedBefore you sign with one of them: the questions worth asking each provider. Already employing someone in Iceland through an employer of record? Check what you pay against these fees.
A listing is the provider's own statement that it can employ in Iceland, read on its site on Nov 9, 2026. Fees are each provider's cheapest published rate, not a quote for Iceland. We read the country lists and country pages of all 93 providers we track; 78 name the countries they serve, and a provider that does not name Iceland on its own site is not shown here, even where it may serve it. Confirm availability for your role and contract type before signing.
The employment terms an employer must meet, each linked to the source that states it.
Paying someone in Iceland as a contractor instead? The law looks at how the work runs, not at what the contract calls it. Check whether the role is employment.
Two ways to put someone on payroll here.
An EOR already has an entity in Iceland and employs your worker on your behalf, handling payroll, tax and the statutory terms above. Fastest way to hire without incorporating.
Compare EOR providersAdd the ~17.85% (social security charge (tryggingagjald) 6.35% on gross salary plus the mandatory pension fund contribution of 11.5% from the employer, against 4% from the employee)↗ employer burden to salary and an EOR service fee to see your true monthly cost to employ in Iceland.
Open the cost calculatorOn top of gross salary, mandatory employer contributions in Iceland run ~17.85% (social security charge (tryggingagjald) 6.35% on gross salary plus the mandatory pension fund contribution of 11.5% from the employer, against 4% from the employee)↗, made up of mandatory pension fund contribution 11.5% from the employer (15.5% minimum in total with the employee's 4%)↗; social security charge (tryggingagjald), combined 6.35%↗. An employer of record adds its own per-employee service fee on top; across the 56 of 93 providers that publish a fee, the median is $349 per employee per month.
EOR service fees are billed per employee per month, on top of salary and statutory employer contributions in Iceland. The contribution basis is ~17.85% (social security charge (tryggingagjald) 6.35% on gross salary plus the mandatory pension fund contribution of 11.5% from the employer, against 4% from the employee)↗. Providers rarely publish a Iceland-specific fee: across the 56 providers on our price board that publish a price, the median is $349 per employee per month (from $99 to $740), and the rest quote per country. Request a quote for Iceland for an exact figure.
Statutory paid annual leave in Iceland is 24 working days↗.
The minimum employer notice period in Iceland is 1-3 months by tenure (statutory); up to 6 months under some collective agreements↗.
The maximum statutory probation period in Iceland is 3 months (typical)↗.
23 of the 93 providers we track name Iceland on their own websites as a country where they offer Employer of Record. By published starting fee: RemoFirst from $199 /mo↗, Skuad (Payoneer) from $199 /mo↗, Tarmack from $199 /mo↗, Thera from $199 /mo↗, Rivermate from $349 /mo↗, and 12 more with a published fee; 6 quote Iceland on request. Each provider's listing is its own claim, so confirm availability for your role and contract type before signing.
In the 30↗ days to Nov 11, 2026, 1 company↗ posted 1↗ full-time remote job open only to people based in Iceland on the Himalayas job board, plus 11↗ contract roles, which ranks Iceland #163 of 177 countries↗. The most hired fields are AI Safety. A company hiring this way without its own entity in Iceland employs through an employer of record.
No. An employer of record (EOR) already holds a legal entity in Iceland and can employ your worker there on your behalf, running local payroll, tax and compliance, so you can hire without setting up your own entity. That settles the employment side only: what the person does for your company (signing or negotiating its contracts, running a sales team, working from one place for most of the year) can still make your company taxable in Iceland as a permanent establishment, whoever employs them.
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