Business & Taxes
Taxes in Georgia (Country): Expert's Guide for Expats
Learn Georgia's tax system for expats - 1% freelancer rate, 0% crypto gains, and foreign income exemptions.
This guide covers all the taxes in Georgia (country) that affect expats - from personal income tax to corporate rates, VAT, and property taxes.
Quick Summary:
Personal income tax: 20% flat rate (or 1% with Small Business Status)
Corporate tax: 15% on distributed profits only
VAT: 18% standard rate
Crypto gains: 0% for individuals
Annual tax deadline: March 31st
Key Definitions
Tax Resident: Someone who spends 183+ days in Georgia within any 12-month period, or qualifies through the High Net Worth Individual program. Tax residency triggers automatically - no application needed.
Tax Year: January 1st to December 31st. Annual declarations are due March 31st of the following year.
Withholding Agent: The person or company responsible for paying tax on behalf of someone else (e.g., employers withholding salary tax).
Personal Income Tax (PIT)
Standard Rate: 20%
Applied to taxable income (total income minus deductible expenses). Must be declared and paid by March 31st of the year following the reporting year.
Small Business Status: 1%
Available to Individual Entrepreneurs with annual turnover under 500,000 GEL (approximately 180,000 USD). If turnover exceeds 500,000 GEL, the rate becomes 3% on the excess. Exceeding the limit two years in a row revokes the status.
Must be declared and paid by the 15th of each month.
Note: Consulting and certain professional services do not qualify. The status cannot be applied retroactively.
Micro Business Status: 0%
For individuals with turnover under 30,000 GEL annually. No employees allowed. Must be declared by March 31st.
Rental Income (Residential Property in Georgia): 5%
Filed and paid by March 31st of the following year. Rental income from property outside Georgia is not taxed in Georgia.
Capital Gains on Property/Vehicles: 5%
Must be declared by the 15th of the month following the sale. Properties held longer than 2 years are exempt.
Capital Gains on Foreign Stocks/Bonds: 0%
Typically exempt as foreign-source income. Exceptions may apply - consult a tax advisor.
Cryptocurrency Gains: 0%
No personal income tax on crypto trading profits for individuals.
Foreign Dividends: Depends
Passive shareholding in a foreign company: 0% (foreign-source income). Actively managing a foreign business from Georgia: complicated - the company may have Georgian tax obligations.
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Corporate Tax (Profit Tax)
Standard Rate: 15%
Applied only when profits are distributed (dividends, etc.). Reinvested profits remain untaxed indefinitely - this is the "Estonian model."
Virtual Zone Companies: 0%
IT companies with Virtual Zone Person status pay no corporate tax on income from exporting services to non-resident clients. Available only to LLCs, not Individual Entrepreneurs. Income from Georgian clients is taxed at the standard 15%.
Free Industrial Zone (FIZ) Entities: 0%
International Company Status: 5%
Available to companies operating primarily outside Georgia after 2+ years of operation.
Withholding Taxes
These apply when paying employees, contractors, dividends, or purchasing services.
Salaries to Residents: 20%
Plus mandatory pension contributions (2% withheld from employee + 2% paid by employer) for Georgian citizens and permanent residents.
Salaries to Non-Residents: Up to 20%
May be reduced or eliminated if a Double Taxation Agreement exists with the employee's country of residence.
Dividends to Individuals/Non-Residents: 5%
Dividends from FIZ or International Company Status entities: 0%.
Interest to Individuals/Non-Residents: 5%
Interest to offshore jurisdiction residents: 15%. Interest from FIZ entities: 0%.
Royalties to Residents: 20%
Royalties to non-residents: 5%. Royalties to offshore jurisdictions: 15%.
Services from Non-Residents: 0-10%
Depends on whether a Double Taxation Agreement exists. Services from offshore jurisdictions: 15%.
VAT
Standard Rate: 18%
Applied to domestic supply of goods/services by VAT-registered sellers and to most imports.
Registration Threshold: Mandatory when turnover exceeds 100,000 GEL in any 12-month period.
Exports/B2B Services to Non-Residents: Generally 0% or outside scope.
Reverse VAT: 18%
Applies when purchasing services from non-residents (contractors, software subscriptions, etc.). Must be declared whether VAT-registered or not. If VAT-registered, you can claim the 18% back immediately.
Deadline: VAT and Reverse VAT declarations due by the 15th of each month.
Property Tax
Property Owned by Companies: Up to 1%
Of average annual book value.
Property Owned by Individuals: 0% to 1%
Depends on household income and municipality. Families earning under 40,000 GEL annually are typically exempt.
Residential Rental Income: 5%
Commercial rental income: 20%.
Deadlines:
Individuals must submit property tax declarations by November 1st and pay by November 15th.
Legal entities file by April 1st.
Import Tax
Rate: 0% to 12%
Depends on the product type. Most common goods are 0% or 5%.
VAT on Imports: 18%
Applied at customs regardless of whether you are VAT-registered. Can be claimed back if VAT-registered.
Small Imports Under 300 GEL: Exempt
No import tax or VAT.
Deadline: Usually within 5 days of goods arriving at customs.
Cryptocurrency
Trading Gains for Individuals: 0%
Based on a 2019 Ministry of Finance ruling. Crypto is not classified as Georgian-source income for individual traders.
VAT on Crypto Exchanges: 0%
Converting crypto to fiat currency is VAT-exempt.
Business/Mining Income: Standard Rates Apply
Companies trading or mining crypto pay 15% corporate tax when profits are distributed.
Double Taxation Agreements
Georgia has DTAs with 56+ countries including most of the EU, US, UK, UAE, China, and Turkey. These treaties can reduce or eliminate withholding taxes and prevent the same income from being taxed twice.
US citizens note: The US taxes citizens on worldwide income regardless of residence. You must still file US returns, but can claim Foreign Tax Credits or the Foreign Earned Income Exclusion. There is no US-Georgia totalization agreement for social security.
Key Deadlines Summary
Tax Type | Deadline |
|---|---|
Annual income tax (individuals) | March 31 |
Small Business Status (monthly) | 15th of following month |
VAT / Reverse VAT | 15th of following month |
Property tax declaration | November 1 |
Property tax payment | November 15 |
Capital gains (property sales) | 15th of month following sale |
Corporate tax returns | March 31 |
Late Filing Penalties:
Up to 2 months late: 5% of tax owed
Over 2 months late: 10% of tax owed
Interest: 0.05% per day on unpaid amounts
What's Next?
This guide covers what the taxes are. If you want to know how to structure your move to Georgia for minimum tax liability - including which regime fits your situation, how to register, and common mistakes to avoid - that requires looking at your specific circumstances.
The most important thing to understand: tax residency triggers automatically after 183 days, and favorable rates like the 1% Small Business Status cannot be applied retroactively. Planning before you arrive (or immediately after) makes a significant difference in what you actually pay.
