Do you know if I need a international drivers licence to drive in Iceland or can I just use the one I have back home?
In order to rent a car in Iceland, you must have a valid driver’s license with letters in the Latin Alphabet (so ‘abc’ rather than Chinese characters or Arabic scripts, for example). So a german license would be fine, but a Japanese one would need to come with an official translation.
You can read more about driving regulations in Iceland here: https://guidetoiceland.is/travel-info/driving-in-iceland
Hope that helps,