Taxes in Georgia
In this article, we will provide information about Georgian taxes and tax rates.
TAX TABLE (RATES) OF GEORGIA:
Tax category | Bid | Tax base | Reporting period | Notes |
Corporate income tax | 15% | Gross amount of distributed dividends divided by 0.85 | Month | Paid only in the event of dividend payments to shareholders or other transactions that are considered equivalent to dividend payments in accordance with the tax code. |
Personal Income Tax in Georgia | 20% | Taxable profit | Year | The standard tax rate for individual taxpayers (however, there are a number of exceptions where lower tax rates apply) |
Personal Income Tax in Georgia | 5% | Gross profit | Year | Applies to income received from renting out residential property |
Personal Income Tax in Georgia | 1% | Gross profit | Month | Applies to individual taxpayers with the status of “small business” (does not apply to all types of entrepreneurial activity, maximum annual turnover is limited to 500,000 gels) |
Personal Income Tax in Georgia | 0% | Income from non-Georgian sources | Annual | Full tax exemption applies to income received by individuals from a non-Georgian source (“Income from a non-Georgian source is defined in the Tax Code of Georgia”) |
Property tax for legal entities in Georgia | up to 1% | Average book value of company assets | Year |
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Property tax for legal entities in Georgia | 0%; 0.05%-0.2%; 0.8%-1% | Market price of fixed assets and vehicles at the end of the year | Year | Individuals with an annual family income of less than 40,000 GEL enjoy a full tax exemption. Different tax rates apply if the annual family income is up to and above 100,000 GEL. |
Land tax in Georgia | 0.24 lari | One square meter of non-agricultural land | Year | Agricultural lands are subject to different (lower) rates. Rates are subject to change within the established range by local municipalities. |
VAT in Georgia | 18% | Turnover | Month | Services and goods provided in Georgia |
Reverse VAT in Georgia | 18% | Compensation for services paid by Georgian tax agents (legal entities, individual entrepreneurs) to non-residents | Month | Applies only to services rendered in Georgia. Note: The Tax Code of Georgia defines which services are considered rendered in Georgia. |
Payroll tax in Georgia | 20% | Gross wages and other payments | Month | Plus contributions to the pension fund |
Pension fund contributions in Georgia | 4% | 2% is deducted from salary; 2% is paid by the employer | Month | Does not apply to foreigners unless they have a permanent residence permit and are not tax residents in Georgia. |
Withholding Tax (WHT) on Dividends in Georgia | 5% | Amount of dividends paid | Month | A tax treaty may provide relief if applicable. |
Withholding tax in Georgia on remuneration for services to non-residents | 10% | Gross amount without deductions | Month | Only payments considered «Georgian-source income» under Article 104 of the Tax Code of Georgia are subject to taxation. Additionally, tax treaties may provide for tax exemptions, if applicable. |
Withholding tax in Georgia on remuneration for services to resident individuals who are not sole proprietors | 20% | Gross amount without deductions | Month | Plus contributions to the pension fund |
Withholding tax in Georgia on interest payments to non-residents | 5% | Gross amount without deductions | Month |
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Withholding tax in Georgia on interest payments to residents | 5% | Gross amount without deductions | Month | Does not apply to payments in favor of legal entities |
Withholding tax in Georgia on royalty payments to non-residents | 5% | Gross amount without deductions | Month |
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Withholding tax at source in Georgia when paying royalties to resident individuals who are not VAT payers | 20% | Gross amount without deductions | Month |
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Value Added Tax in Georgia on any payments to tax haven companies | 15% | Gross amount without deductions | Month | Applies to remuneration for services, interest, royalties and other payments that are subject to value added tax, except for dividends |
Accounting and tax consulting company in Georgia
Tbilisi-based accounting firm TPsolution provides high-quality tax services in Georgia, including: tax consulting, tax return filing, due diligence, transfer pricing documentation, representation during tax audits, tax dispute resolution, and the proper application of Georgian tax treaties. Email: [email protected] or [email protected]
About the author: Gela Barshovi is an international and Georgian tax consultant and managing partner of the Georgian accounting and consulting firm TPsolution . For questions about business registration, tax consultations, and/or accounting services, please contact him directly at [email protected]