Renting a Car in January in Iceland: What to Know

January is one of the most misunderstood months to drive in Iceland. Snow-covered landscapes, quiet roads, and peak northern lights season make it incredibly appealing, but winter conditions demand realistic planning, the right vehicle, and a clear understanding of how driving costs and safety actually work.

This guide explains what renting a car in Iceland in January is really like. You will learn how winter driving works, what kind of car makes sense, what it costs to drive in 2026, and how to plan your trip safely without unnecessary risk.

Executive summary: Is January a good time to rent a car in Iceland?

Yes. January is an excellent time to rent a car in Iceland for travelers who prioritize flexibility, lower costs, and northern lights viewing. It is typically the cheapest month for car rentals and one of the quietest on the roads. Success depends on flexible planning, daily weather checks, and choosing a vehicle suited to winter conditions.

What driving in Iceland is like in January

January is full winter in Iceland. Roads may be covered in compact snow, slush, or black ice, and weather can change quickly. The Ring Road, Golden Circle, and main South Coast routes are well maintained and regularly plowed, but conditions can deteriorate rapidly during storms or high winds.

Winter driving in Iceland is not difficult when approached correctly. The key is preparation and patience rather than confidence or speed.

Before driving each day, always check:

• Icelandic Road Authority road conditions: road.is
• Icelandic Met Office forecast: en.vedur.is

Wind is often a bigger factor than snow. Gusts above 20 meters per second can make driving uncomfortable or unsafe, especially for higher-profile vehicles.

For a year-round overview of driving rules and winter safety fundamentals, see our guide to driving in Iceland.

If you want a safety-focused breakdown of winter expectations, read our Car Rental Iceland FAQ.

Daylight hours in January

January has the shortest daylight hours of the year, but daylight increases steadily as the month progresses.

• Early January typically offers around 4 to 5 hours of usable daylight.
• Late January offers closer to 7 hours.

This affects pacing rather than feasibility. Plan sightseeing during daylight and keep driving distances short. Evenings are best reserved for northern lights viewing rather than long road segments.

Do you need a 4x4 in January?

A 4x4 is not legally required on paved roads in January, but many travelers choose one for added stability and peace of mind.

A small or mid-size car can be suitable if you:

• Stay on main paved roads
• Focus on the Golden Circle or South Coast
• Avoid driving during storms

A 4x4 or SUV is recommended if you:

• Expect snow or strong crosswinds
• Travel with family or heavy luggage
• Want added traction on icy surfaces
• Plan to explore beyond the most heavily trafficked routes

Many visitors assume a 4x4 is mandatory in winter. In reality, winter tires, cautious driving, and route choice matter more than drivetrain alone.

Highlands F-roads are closed in January regardless of vehicle type.

For route-based vehicle guidance, see our guide to the best cars for every traveler and trip.

Northern lights and renting a car in January

January is one of the best months to see the northern lights thanks to long nights and low light pollution. Renting a car gives you the freedom to follow clear skies, leave city lights, and adjust plans as forecasts change.

Unlike guided tours, you are not locked into a single location or schedule, which significantly increases your chances of seeing aurora when conditions are right.

What it costs to drive in Iceland in January in 2026

Driving costs in Iceland changed in 2026, making January more predictable and often cheaper than in previous years. Your budget is mainly shaped by fuel prices, the road usage tax, and parking.

Fuel prices

Fuel prices dropped significantly following Iceland’s shift to a kilometer-based road tax system. Petrol and diesel prices commonly fall in the range of roughly 180 to 210 ISK per liter, depending on location and station.

If you are planning a full trip budget, our cost breakdown guide is a useful companion: car rental Iceland costs and how to save.

The 2026 road usage tax

Iceland applies a national road usage tax. While some rental companies charge this per kilometer after the rental, Zero Car applies it as a fixed daily fee.

• Fixed daily road tax: 1,550 ISK per day
• Unlimited mileage
• No end-of-trip surcharges based on distance

For the full explanation of the national system and how it works in practice, see our Iceland road tax 2026 guide.

Parking fees

Most major attractions and urban areas use camera-monitored pay-by-plate parking systems. This includes Þingvellir National Park, Seljalandsfoss, Skógafoss, Reynisfjara, and downtown Reykjavík.

Payment is typically handled via Parka or EasyPark apps. Unpaid sessions generate automatic invoices sent to the rental provider, often with added handling fees.

To avoid common mistakes, read our guide to avoiding unwanted parking and toll surprises.

Official Reykjavík parking rules are published here: reykjavik.is/en/parking.

January routes that make sense

January is not ideal for rushing long distances or attempting the full Ring Road unless you have experience and flexibility.

Routes that work well in January include:

• The Golden Circle
• The South Coast to Vík
• Snæfellsnes Peninsula in stable conditions
• Short multi-day loops rather than long daily drives

If conditions deteriorate, adjusting plans or staying put is part of responsible winter travel.

Why Zero Car works especially well in January

Winter driving comes with inherent risks such as ice, wind-related door damage, and reduced visibility. Transparent pricing and full coverage matter more in January than any other month.

Zero Car includes:

• Full insurance with zero excess
• Roadside assistance with no deductible
• Unlimited mileage
• No deposit
• 24/7 self-service pickup and drop-off at KEF and Reykjavík

For a deeper explanation, see why renting a car in Iceland with Zero is the best decision.

Final thoughts

Renting a car in January is about preparation, not bravery. If the forecast shows a storm, wait it out. If conditions are clear, a rental car gives you unmatched freedom to explore winter landscapes and chase the northern lights on your own terms.

With the right expectations and planning, January becomes one of the most rewarding times of year to experience Iceland by car.