Household gross disposable income increased by 6.8% in 2025 according to preliminary figures. Disposable income per capita amounted to roughly 6.4 million ISK in 2025 and is estimated to have increased by 5.4% from the previous year. The purchasing power of household disposable income per capita increased by 1.2% during the same period due to an increase in the consumer price index by 4.1% over the year.
Increase in household income from wages
Household total income is estimated to have increased by 7.3% in 2025 from the previous year. Increase in wages bears the brunt of the total increase, increasing by roughly 170 billion ISK from the previous year or 7%. For the same period, taxes on income increased by 65 billion ISK or about 9.4%.
Household interest expenses are estimated to have increased by 3.4% in 2025 from the previous year. During the same period, household property income increased by 3.1%.
Social benefits other than social transfers in kind increased by 9.8%
Social benefits other than social transfers in kind are estimated to have increased by roughly 62 billion ISK from 2024, an increase of 9.8%. The share of social benefits other than social transfers in kind of household total income was measured at 15.4% in 2025. The household sector’s net social contributions increased by 4.5% in 2025 compared with 2024.
Household gross disposable income is estimated to have increased by 5.8% in the fourth quarter of 2025, compared with last year’s corresponding quarter. Disposable income per capita amounted to just over 1.6 million ISK in the quarter and is estimated to have increased by 4.4% compared with the fourth quarter of 2024. Due to increased inflation rate, the purchasing power of household disposable income per capita in the fourth quarter of 2025 increased by 0.2% compared with last year’s corresponding quarter, but the consumer price index increased by 4.2% during the same period.
Household total income increased by 6.8% in the fourth quarter of 2025, compared with last year’s corresponding quarter, where wages increased by 5.9% and property income increased by 3.0%. Household total expenditure increased by 8.3% in the fourth quarter of 2025, compared with last year’s corresponding quarter.
Social benefits other than social transfers in kind are estimated to have increased by 13.2% in the fourth quarter of 2025, compared with last year’s corresponding quarter, equivalent to 15.4% of household total income in the quarter. The household sector net social contribution increased by 2.1% in the fourth quarter of 2025, compared with the previous year’s corresponding quarter.
These are preliminary figures based on the best available information and thus Statistics Iceland will publish revised figures when exhaustive information is available, e.g. tax returns from corporations and individuals.