Bookkeeping for restaurants in Iceland: VAT, daily takings and shift pay at a fixed price

Kassify · 6 November 2026

Kassify is an accounting firm that runs the bookkeeping, shift payroll, VAT returns, annual accounts and tax return of restaurants and cafés at a fixed price, 20% below a traditional accounting firm. The day's takings are booked at the right rate, card sales are matched to the bank and pay is worked out under the collective agreement, with accredited bookkeepers and certified auditors behind the work.

This page covers the rules that apply to a restaurant, one month in krónur, what Kassify does and what is left for you, how the price works, how the move works and who signs.

Who Kassify is for

Kassify is for the owner of a restaurant, café or bar who wants the books done for them. In a restaurant the takings come in every day, mostly by card, staff work evenings and weekends, and supplier invoices arrive every week. Each day leaves a daily sales report, a card settlement and receipts, and each month leaves payslips with shift premiums.

Kassify is both the system and the firm, so you stop paying separately for accounting software, a bookkeeper by the hour and an accountant at year end.

The rules that apply to restaurants

VAT: 11% on food and drink, 24% on room hire

Restaurant sales of prepared food and catering are in the 11% bracket, and that includes alcohol and alcoholic drinks. Takeaway food is a sale of food products, which is also in the 11% bracket. Two things go in the 24% bracket: hire of premises, for example a room rented for a party, and serving sold as a separate service.

Input VAT, entertainment costs and exempt sales are covered in the article on VAT in Iceland 2026.

Cash register and daily closing

A restaurant that sells mainly to consumers may use a cash register (sjóðvél) instead of sales invoices, and as a rule one method is used for all sales. Skatturinn's rules for cash registers rest on regulation no. 50/1993 on bookkeeping and sales recording by VAT-registered parties:

• Each sale is entered in the register as it happens, and the customer gets a register receipt with every sale.
• The receipt shows the date and splits the sale by VAT rate.
• At the end of each working day, or shift, a daily sales report is printed. It shows the day's total sales, the number of transactions and how often the drawer was opened without a sale, among other things.
• The sales settlement sheet splits the takings into cash, card and credit, and explains any difference between the register total and the cash counted. If the cash counted is higher than the sales recorded, the difference is booked and taxed at the day's average VAT rate.
• A responsible employee signs the daily closing.
• A business customer that asks for an invoice gets a sales invoice, with the register receipt stapled to it.
• Accounting records are kept for 7 years from the end of the financial year. Internal register tapes need not be kept for more than 3 years, once the books are complete and the annual accounts signed.

Card sales and cash

The card acquirer pays card sales into the bank account in settlements, less its fee. The deposit in the bank is therefore lower than the card sales on the daily report. In the books the sale stands in full and the fee as a cost. Cash is counted at the end of the day, and the deposit in the bank should match the cash on the sales settlement sheet.

Pay under the collective agreement

Staff in the member unions of Starfsgreinasambandið (SGS) are paid under the agreement between SGS and Samtök atvinnulífsins (SA) for restaurant, accommodation, service and catering businesses, valid from 1 February 2024 to 1 February 2028. Starting monthly pay at age 18 from 1 January 2026:

Wage rates on the general labour market also rose by 0,06% on 1 April 2026 through a rate supplement (kauptaxtaauki). Shift work outside daytime hours carries a premium on the daytime rate, and the daytime hourly rate is the monthly pay divided by 172:

On top of pay, the restaurant pays an 11,5% employer pension contribution (mótframlag) and 6,35% social security tax (tryggingagjald) on pay and the pension contribution together. Under chapter 11 of the agreement it also pays 1% to the union's sickness fund, 0,25% to its holiday home fund and 0,3% to its training fund, and 0,10% goes to the VIRK vocational rehabilitation fund, 1,65% of pay in all. Withholding tax and pension returns are covered in the article on payslips.

One month in a restaurant, in krónur

Assume a restaurant with 8 staff, most of them part-time, in October 2026. Every amount below is an assumption of the example. The rates, premiums, pension contribution, social security tax and fund contributions come from the sources.

The month's daily sales reports show these sales:

Of the takings, 6.384.000 kr. was paid by card and 400.000 kr. in cash, and in the example the card acquirer takes a 1% fee, 63.840 kr. The bank then receives 6.320.160 kr. of the card sales. Card sales are booked at 6.384.000 kr. and the fee of 63.840 kr. as a cost.

The month's purchases:

The month's VAT is 684.000 kr. of output VAT less 280.000 kr. of input VAT, or 404.000 kr. The amount goes on the VAT return for the September and October period.

Total pay for the month is 2.400.000 kr., shift premiums included:

Social security tax is worked out on pay and the pension contribution, not on the fund contributions.

This is how the shift premium works for one full-time waiter on a fixed monthly pay of 500.000 kr., with 40 evening hours on weekdays and 24 hours at weekends. The daytime hourly rate is 500.000 / 172 = 2.906,98 kr. The evening premium is 40 × 959,30 kr. = 38.372 kr. and the weekend premium 24 × 1.308,14 kr. = 31.395 kr., together 69.767 kr. on top of the fixed pay.

The errors that skew a restaurant's books

• The day's takings booked as one figure. The split into 11% and 24% that the VAT return needs is lost.
• The card deposit booked as the sale. The fee goes missing, and sales in the books come out lower than on the daily report.
• Room hire at 11%. Hire of premises and separately sold serving belong at 24%.
• Premiums worked out on the wrong base. The daytime hourly rate is the monthly pay divided by 172.
• A cash difference left unexplained. It should be explained on the sales settlement sheet the same day.

What is included, task by task

This is how each task splits between Kassify and you.

No entry is typed in by hand. The shift ends with the daily closing, and the books take over from there.

How the price works

A restaurant pays Kassify one fixed monthly price. It covers the bookkeeping, shift payroll, VAT returns, the app, the annual accounts and the tax return, and it reflects the size of the business. The price is set out in writing before anything is signed, so the cost is known whether the month's takings are high or low.

The yearly cost of bookkeeping is 20% below a traditional accounting firm. The move is included, there are no setup fees and everyday questions cost nothing extra. A restaurant that takes on staff for the summer gets no new invoice for each question about pay.

How the move works

1. 1
   You name the bookkeeper

   Kassify contacts your current bookkeeper and collects the books and where VAT and payroll stand. That conversation is Kassify's job.

2. 2
   The history comes across

   Earlier months' books, unpaid supplier invoices and the staff's pay history move from Payday, dk, Regla, Netbókhald or another system, and the balance on each account is checked against the old system.

3. 3
   The switch happens at a daily closing

   The switch is set at the end of a working day. That day's sales report is the last closing in the old books, and the cash in the drawer is counted and entered as the till's opening balance in Kassify.

4. 4
   The first shift with Kassify

   You log in to the bank once. The next daily closing goes to Kassify, and card settlements are matched to sales from the first day.

The move takes less than 7 days and is included in the price. A month end is the easiest day to switch, because payroll and the VAT period follow the months, and the New Year starts a new financial year. If you switch mid-year, the year's books are brought in and reconciled, so the annual accounts cover the whole year. The handover from the old bookkeeper is covered in the article on changing your bookkeeper.

Who signs

• The daily closing. A responsible employee on site signs it at the end of each day or shift, as Skatturinn's rules expect. Kassify books it and checks it against the bank.
• The books. Kassify's accredited bookkeepers confirm that each entry is booked and matched correctly.
• The VAT return. You see the amount first, and then Kassify sends the return to Skatturinn. Filing is not payment, and the payment stays in your hands.
• Payroll. Kassify prepares the payments and you approve them in your online bank.
• The annual accounts. Kassify prepares them from the books, and they are reviewed by a certified auditor. The company's board signs them, and Kassify then sends them to the annual accounts register. The company's tax return rests on the same figures.

More on the bookkeeping service on the bookkeeping page.

Questions

Every transaction booked. Every return on time.

Leave your email. At a first meeting Kassify goes through your daily closings, payroll and VAT, and the price follows in writing.