Are all fees and taxes included in the rental price?

Iceland’s new kilometre fee

On January 1, 2026, Iceland introduced a kilometre-based road fee for all vehicles, regardless of whether they run on petrol, diesel or electricity. This replaced part of the taxation previously collected through fuel prices.

For passenger cars and SUVs weighing up to 3.5 tonnes, the government fee is:

• ISK 6.95 per kilometre driven, or
• ISK 1,390 per started rental day when the vehicle is registered under the government’s daily-fee scheme.

The daily fee is based on an estimated 200 kilometres of driving per day. Rates may be different for vehicles weighing more than 3.5 tonnes.

The rental company determines which permitted calculation method applies to the vehicle. Most of Northbound’s rental partners use the daily fee.

Is the fee included in the booking price?

No. The kilometre fee is collected separately by the rental company, normally at pickup or return. It is therefore not included in the amount paid to Northbound.

The applicable calculation method and estimated charge are displayed during checkout and on your rental voucher. If the fee is calculated using the vehicle’s actual mileage, the final amount will depend on how far you drive.

VAT, airport fees, mandatory Collision Damage Waiver and Third-Party Liability insurance, and all other mandatory charges included in the rental price are already reflected in your booking total. Optional extras and usage-based charges are shown separately.

Your voucher clearly identifies the amount included in your booking and any mandatory charge payable locally. You should not encounter any undisclosed mandatory fees when collecting the vehicle.