It is possible to take out an offshore investment bond whilst resident in Iceland. This is because Iceland does not appear on the “Prohibited Countries” list which the offshore bond providers use to determine eligibility for their product. This list is based on two factors- regulatory reasons where the local country has local legislation prohibiting an offshore investment or from guidance produced by the Office of Foreign Assets Control or HM Treasury. An example of a “Prohibited Countries list” can be found here:
It is always essential to seek local taxation advice because the tax treatment can be different to how an offshore bond is taxed in the UK.
See our section which is translated into Icelandic which gives a generic guide to offshore investment bonds.