Iceland has to offer the most abstract landscapes in Europe, short of some areas in the Italian Dolomites. The country has every photographic cliche and wonders you could want; mountains, waterfalls, river beds, glaciers, and lava fields. It’s a place of rugged beauty and extreme weather conditions, blessed with an amazing quality of light.
In August, golden light lasts for 4-5 hours* so that there is no rush. But it also means that you have to stay up late and get out early in the morning. At least photography doesn’t clash with dinner and breakfast.
There is direct sun but your prefer a cloud to create soft light? Just wait a few minutes. Dark clouds and rain add mystery to the landscape, while shortly after, they let some rays peak through to create a rainbow. There is good light almost anytime during the day. Iceland is indeed a paradise for photographers.