Effective for 10 consecutive years and the applicant selects the start date. The measures are threefold.
- Private pension savings that have accrued over a particular period may be used for the purchase of a first residence.
- Private pension savings may be used for a property loan that is secured with a lien in the first property and which was taken for that purchase.
- Private pension savings may be used for the payment of instalments on a unindexed loan and toward reducing the principal of a loan that is secured with a lien in the property.
- These measures are tax free.
- The maximum amount per year is ISK 500,000 per person, with a maximum 4% from the employee and 2% from the employer.
- The contribution of the individual must be at least as high as that of the employer.
- The right holder must own at least 30% of the residential property, and there may not be more than two buyers.
- The Act entered into force as of 1 July 2014. Private pension savings that have accrued since 1 July 2014, however, may be used for the first-time purchase of a property.
- Individuals who bought their first property during the period between 1 July 2014 and 30 June 2017 and who pay private pension savings toward the principal of a loan according to the earlier authorisation can apply for this measure for a first property, but they must send in the application before the end of 2017. The period that has already been utilised is deducted from the consecutive 10-year period.
- Applications are to be sent electronically to Directorate of Internal Revenue.