Self-employed - temporary support for the payment of wages

Temporary support for the payment of wages to self-employed individuals due to the natural disaster in Grindavík.

Questions and answers

Who are entitled?


1. Are self-employed individuals entitled to support for the payment of wages?

Yes, self-employed individuals who are not able to perform their work at the workplace in Grindavík due to a natural disaster are entitled to support for the payment of wages.

2. If I as a self-employed individual receive allowance from elsewhere - do I have a right to payments of wages?

  • Those who receive payments according to other Acts of law or according to collective agreements that are meant to be an allowance for the same period as the proposed Act covers, are not entitled to payments.
  • If you receive an allowance via another insurance system, you might not be entitled to these payments.
    This may apply due to:
    • Sick leave payments
    • Accident per diem payments
    • Sickness per diem payments
    • Rehabilitation pension
    • Maternity/Paternity Leave If you are on Maternity/Paternity Leave and working part-time, you are entitled to support.
    • Bereavement leave
  • If you have any questions or are in doubt, then please contact us and we will assist you in taking the next steps.

Conditions


1. What are the conditions for the support to self-employed individuals?

The conditions of the payment of wages are:

  • That self-employed individuals are not able to perform their work in Grindavík, partially or entirely, due to a natural disaster in the region.
  • That the self-employed individual’s business is in operation with an open employer’s registry.
  • That the self-employed individual has paid social insurance contributions and withholding tax on calculated remuneration according to the tax authorities’ decision for at least three months during the past four months or by other regular means according to Iceland Revenue and Customs’ regulations.

2. Do I, as a self-employed individual need to be domiciled in Grindavík to be entitled to this support?

No, you do not need to be domiciled in Grindavík or have had a permanent residence there. The conditions are that your workplace is in Grindavík and that you have been working there.


Application process


1. Where do self-employed individuals apply for support for the payment of wages due to the natural disaster in Grindavík?

Self-employed individuals apply for payments via My pages for job seekers on The Directorate of Labour’s website. My Pages

2. I am self-employed individual but operating with separate ID number. How do I apply?

  • If you are a wage earner at your own company which is operated on a separate ID number then you apply as an employer or employee, as applicable.
  • Individuals operating on their own ID number apply as self-employed.

Amounts


1. What are the amounts for support to the self-employed based on?

They are based on the average of calculated remuneration of which a social security contribution has been paid for the last three months (August - October 2023) The Directorate of Labour deducts 4% from the wages and pays it to the relevant pension fund. The Directorate of Labour also pays a 11,5% counter contribution.

2. What are the amounts of support based on?

  • Payments can never amount to more than 633.000 kr. based on a full calendar month, in addition to an amount equal to 11,5% counter contribution to a pension fund for a total of 705.795 kr. per month for each individual.
  • Payment of wages is based on the calendar month and the amount is proportionately lower for a shorter period.

3. What if a self-employed individual must have ceased employment from the 11th of November?

If a self-employed individual must have ceased employment from the 11th of November then payments will be based on the average of calculated remuneration which has been paid and the period when the person was not able to work as a self-employed individual.


Payments


1. What date are payments based on?

  • Payments will be based on the date from when the self-employed individuals were unable to perform their work in Grindavík.
  • Payments can be made, at the earliest, from the 11th of November 2023.

2. When will payments for this support be paid out?

The Directorate of Labour intends to make payments on the first working day of each month.

3. Will payments be made to a union of this support?

No, according to the Act on Temporary Support, payments to unions are not required. The Directorate of Labour encourages applicants to contact their union for further information about further payments.


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