Summarise (click here)
Car Specs
- Seats up to 5 passengers (though 4 is recommended).
- Automatic transmission.
- 2WD (front-wheel drive).
- Space for about 3 large suitcases.
- Air conditioning and standard comfort/safety features.
Who It’s Suitable For
- Small families, couples, or solo travellers.
- Drivers who want a comfortable and efficient compact car.
- Good choice for everyday touring and longer paved road trips.
Where It Can Go in Iceland
- Ideal for the Ring Road (Route 1) and main paved sightseeing routes.
- Great for popular tours like the Golden Circle, South Coast, Reykjavík, and town driving.
- Not allowed on F-roads or highland mountain tracks.
Good to Know
- A practical, well-balanced compact car with a comfortable ride and good fuel efficiency.
- Best for travellers sticking to maintained paved roads.
Volkswagen Golf is one of the best compact cars in our fleet. It is a five-door, five-passenger car which can fit up to three large luggage at its regular boots capacity. By folding the backseat, you could increase the cargo space and fit up to five pieces of bags at a time.
Looking for a Manual Volkswagen Golf?
A Small Car With Good Luggage Space
The Volkswagen Golf rental in Iceland is a compact car that offers more cabin space and luggage capacity compared to economy options like the Toyota Yaris. With extra legroom and comfort, it’s a popular choice for travelers who want affordability without sacrificing space, making it ideal for couples or small groups planning to explore Reykjavík, the Golden Circle, or even the full Ring Road. As a compact category car, it remains budget-friendly while providing greater convenience than smaller economy models.
Fuel efficiency is another key benefit of the VW Golf, with an average consumption of 6.9 L/100km on highways, 9.8 L/100km in cities, and 8.5 L/100km combined. This makes it a reliable and cost-effective option for longer drives, whether covering the Diamond Circle in North Iceland or road-tripping the Ring Road. Please note that the Volkswagen Golf is a 2WD vehicle and is not allowed on F-roads or in the Highlands, making it best suited for paved routes and popular tourist attractions.
Driving in Iceland
Familiarise yourself with how to drive in Iceland. Get trusted tips from locals with a lot of experience.
4×4 Iceland Car Rental Guide
What Makes 4×4 the Most Recommended Car Type for Driving in Iceland
FAQ
- Can you drive a small car on the Ring Road in Iceland?
Yes, you can drive a small car on the Ring Road in Iceland, especially during the summer months when roads are clear and well-maintained. Just avoid F-roads and highland areas, which legally require a 4×4 vehicle.
- Is a 2WD small car enough for summer in Iceland?
Yes, a 2WD small car is enough for summer in Iceland, as most main roads and the Ring Road are fully paved and easy to drive. It’s a budget-friendly option for exploring popular routes like the Golden Circle and South Coast.
- What months do I need a 4×4 in Iceland?
You need a 4×4 in Iceland mainly from October to April during the winter months. You also need a 4×4 during the summer if you plan on exploring the highland F-roads.
- What is the new kilometer tax / road tax fee in Iceland?
As of January 1st 2026 the Icelandic government is replacing part of the traditional fuel-based road tax with a usage-based system (“kílómetragjald”), calculated per kilometer driven and adjusted by vehicle weight. All vehicles using Icelandic roads, including rental cars, are required to contribute through this kilometer-based charge to support road maintenance and future infrastructure.
- What is the new kilometer tax / road tax fee in Iceland?
As of January 1st 2026 the Icelandic government is replacing part of the traditional fuel-based road tax with a usage-based system (“kílómetragjald”), calculated per kilometer driven and adjusted by vehicle weight. All vehicles using Icelandic roads, including rental cars, are required to contribute through this kilometer-based charge to support road maintenance and future infrastructure.
- Why is Thrifty Car Rental Iceland charging it?
The tax applies to all standard passenger cars and SUVs under 3.5 tonnes, as well as heavier vehicles in higher weight categories, with rates defined by law for each class. It applies to both Icelandic residents and visitors, including tourists renting a vehicle from Thrifty Iceland for a short stay or a longer road trip such as the Ring Road.
- Is it included in the daily rate?
The Road Tax appears as its own line item at these points:
- On your rental agreement at the check-in desk
- On your final invoice after drop-off
This clear separation helps show exactly what portion of your total cost is the government-mandated tax versus your actual rental service.
The charge applied to your rental agreement consists of two clear parts:
- Government Road Tax: The mandatory fee set by the Icelandic Parliament.
- Thrifty Service Fee: Covers the administrative cost of processing, reporting, and remitting these taxes to the government.
Rate (Per KM) Government Road Tax 6.95 ISK (Approx . 0.056 USD / 0.047 EUR) Thrifty Service Fee 1.40 ISK (+ VAT) (Approx . 0.011 USD / 0.0095 EUR) - Where do I pickup my rental car?
Our desk is located directly inside Keflavik International airport.
Just head to the Hertz rental desk in the arrivals hall, and you will be hitting the Icelandic roads in no time. Thrifty is serviced by Hertz Iceland, so everything is in one easy spot and to the highest standard.
We also have pickups available at Reykjavik Domestic Airport, Akureyri, Egilsstaðir, and Ísafjörður.
- What is your cancellation policy?
In case of a cancellation, the rental needs to be cancelled more than 3 days prior to rental pick up for a full refund.
If a rental is cancelled with less than 3 days notice or in case of no show the full rental price will be charged.
- 3 days or earlier – Full refund
- Less than 3 days – Non refundable
If you need to cancel your prepaid reservation please do so by sending an email to thrifty@thrifty.is stating your name and reservation number.
