Union dues are calculated on the same basic wages as pension fund contributions under collective bargaining agreements. The fund collects union dues for the following unions:

• VR
• Union of Dental Technicians and Dentists' Assistants (FTAT)

_{* Only contributed by those paying into one of these associations: Bílgreinasambandið, Kaupmannasamtök Íslands, Samtök atvinnulífsins, Samtök iðnaðarins, Félag atvinnurekenda, Samtök verslunar og þjónustu SVÞ, Viðskiptaráð Íslands.}

Fees for collective bargaining agreements

Are paid by employers who are members of the Icelandic Federation of Trade (Félag atvinnurekenda) The fee is 0.17% of the base wages for pension fund contributions.

 All employers are obliged to remit a fee amounting to 0.1% of gross wages to the vocational rehabilitation fund VIRK. This is mandatory under Art. 12 of Act No. 73/2011. The obligation to make payment also includes persons not covered by collective bargaining agreements.

According to the Act, employers must remit the fee to the pension fund to which they pay pension contributions. Pension funds, in other words, are to serve as intermediaries in collecting the fee and passing this on to the rehabilitation fund VIRK.

The fee to the rehabilitation fund is 0.1% of the base wages for pension fund contributions.

Click here for further information on the vocational rehabilitation fund VIRK.

Employers and self-employed persons must notify the fund if they are no longer required to remit contributions because they have ceased their activities or their employees have ceased work. This is best done by sending an e-mail to netskil@live.is

There are three possible routes for payment of contributions:

• Paying invoices sent via online banking.
• Making payments by online deposit to account 515-26-1007, Reg. No. 430269-4459.
• Making payment personally with a bank deposit.

Due date -10th day of the following month

For example: The due date for contributions for wages in October is 10 November.

Final date for payment -  Last working day of that month

For example: The final date for payment of contributions for wages in October is the last working day of November.

If payment is not made within the month penalty interest is calculated from the due date until the date payment is made.

A collection process begins if contributions are not paid by the final date for payment.

The process is as follows:

• A warning is sent on the 15th of the first month after the due date, giving the debtor a time limit of 15 days to pay.
• If payment is not received, a letter of collection is sent on the 10th day of the second month after the due date, giving the debtor a time limit of 14 days to pay.
• The case is sent for legal collection in the third month after the due date.

As an example, if the August payment is in arrears:

• The due date is 10 September.
• The final date for payment is 30 September.
• A warning is sent on 15 October with the deadline for payment 30 October.
• A collection letter is sent on 10 November giving a time limit until 24 October for payment.
• In December the case is sent for legal collection.

Supervision by the Directorate of Internal Revenue (Ríkisskattstjóri, RSK)

At the end of each year the Directorate of Internal Revenue gathers information on wages for which contributions are to be paid and on the remittance of contributions to pension funds. This is done by comparing information on pay slips, tax returns and contribution remittances to pension funds.

Pension funds are obliged to collect unpaid contributions based on information from the Directorate of Internal Revenue, plus penalty interest.

Further information on this is available on the website of the Directorate of Internal Revenue.