Individual Entrepreneur in Georgia
IE · Formation from $10
Last verified: June 13, 2026
Corporate Tax
1.0%
State Tax
0.0%
Formation Cost
$10
Annual Fee
$0
Comparison Scores
Privacy, remote setup, banking, and tax efficiency
Calculate full formation cost
Break down one-time filing fees and recurring costs for any supported entity type.
Who Should Choose This?
Profiles that typically benefit from this entity
- Freelance software developers and IT professionals working with international clients.
- Digital marketers, designers, and creatives seeking a low-tax base.
- Solo founders and digital nomads earning under $185,000 annually.
- E-commerce entrepreneurs selling digital goods globally (subject to specific activity checks).
Who Should Avoid This?
Scenarios where another structure may be better
- Management consultants, lawyers, and architects (excluded from the 1% tax regime).
- Founders seeking to raise venture capital or issue equity to investors.
- Businesses with high operational expenses and low profit margins (since the 1% tax is on gross turnover, not net profit).
- Entrepreneurs who want to limit their personal liability from business risks.
Advantages
- +1% tax rate on gross turnover up to 500,000 GEL (approx. $185,000) under the Small Business Status.
- +100% remote formation is possible via a notarized and apostilled Power of Attorney.
- +No minimum share capital required to start the business.
- +0% VAT on B2B IT services exported to foreign clients.
- +Simple accounting with cash-basis reporting and no complex corporate governance.
- +Funds are freely available for personal use immediately after paying the 1% tax (no dividend tax).
Disadvantages
- -Unlimited personal liability for business debts and obligations.
- -Certain professions (management consulting, legal, medical, architecture) are excluded from the 1% Small Business Status.
- -Mandatory monthly tax declarations by the 15th, even if revenue is zero.
- -Exceeding the 500,000 GEL threshold for two consecutive years revokes the Small Business Status.
- -Banks have increased KYC scrutiny for non-resident entrepreneurs opening accounts remotely.
Formation Steps
Draft and notarize a Power of Attorney (PoA) and passport copy, then apostille or legalize them in your home country.
Send the physical apostilled documents via international courier to your representative in Georgia.
Secure a registered legal address in Georgia (usually provided by a local agency) and obtain the property owner's consent.
Your representative translates the documents into Georgian and notarizes the translation locally.
File the Individual Entrepreneur registration application at the Public Service Hall (House of Justice).
Once registered (usually 1-2 days), apply for the Small Business Status at the Revenue Service to activate the 1% tax rate.
Open a multi-currency corporate bank account (GEL, USD, EUR) at a local bank like Bank of Georgia or TBC.
Cost Breakdown
Detailed breakdown of formation and ongoing costs
| Item | Type | Amount |
|---|---|---|
| State registration fee (Expedited) | One-time | $35 |
| Registered legal address | Annual | $150 |
| Remote formation agency fee (incl. translations) | One-time | $300 |
| Monthly tax filing service (estimated annual) | Annual | $360 |
| First year total | $845 | |
| Annual ongoing | $510 | |
Real-World Examples
Typical use cases for this entity type
- A freelance software engineer from Germany registers an IE in Georgia remotely, bills US clients $120,000/year, and pays only $1,200 in taxes while keeping the rest.
- A digital nomad graphic designer relocates to Tbilisi, uses the 1-year visa-free regime, and operates an IE to legally invoice European agencies at a 1% tax rate.
- An SEO specialist exceeds the 500,000 GEL limit in year one, pays 3% on the excess, and restructures into an LLC in year three after losing the Small Business Status.
Common Mistakes
Pitfalls to avoid during setup and operations
- Assuming all freelance activities qualify for the 1% tax rate (e.g., registering as a consultant instead of an IT service provider).
- Forgetting to file the monthly zero-turnover tax declaration, resulting in automatic fines.
- Failing to apply for the Small Business Status at the Revenue Service after registering the IE (the 1% rate is not automatic).
- Mixing personal and business expenses in the same bank account, complicating tax audits.
- Not tracking the 100,000 GEL VAT registration threshold, which still applies even if your services are zero-rated for export.
Other entity types
Other formation options in Georgia
Limited Liability Company (LLC)
- Tax
- 15.0%
- Formation
- $37
Virtual Zone Company
- Tax
- 0.0%
- Formation
- $40
LLC (International Company)
- Tax
- 5.0%
- Formation
- $74
Joint Stock Company (JSC)
- Tax
- 15.0%
- Formation
- $135
Branch Office
- Tax
- 15.0%
- Formation
- $75
Joint Liability Company
- Tax
- 15.0%
- Formation
- $40
Limited Partnership
- Tax
- 15.0%
- Formation
- $38
Cooperative
- Tax
- 15.0%
- Formation
- $37
Compare with Other Countries
| Country / Type | Tax | Formation | Annual |
|---|---|---|---|
| 🇬🇪 Individual Entrepreneur(IE) | 1.0% | $10 | $0 |
FAQ
Do I need to visit Georgia to register as an Individual Entrepreneur?
No, you can register 100% remotely using a notarized and apostilled Power of Attorney.
What happens if I earn more than 500,000 GEL in a year?
The amount above 500,000 GEL is taxed at 3%. If you exceed the limit for two consecutive years, you lose the Small Business Status.
Can I use the 1% tax rate for consulting services?
No, management consulting, legal, architectural, and medical services are explicitly excluded from the Small Business Status.
Do I have to pay a dividend tax to withdraw my money?
No, as an Individual Entrepreneur, the money is yours to use freely once the 1% turnover tax is paid.
Is there a minimum capital requirement?
There is no minimum capital required to register an Individual Entrepreneur in Georgia.
Do I need to charge VAT to my international clients?
B2B services provided to clients outside of Georgia are generally exempt from Georgian VAT (0%).
How often do I need to file taxes?
You must file a turnover declaration and pay the 1% tax monthly, by the 15th of the following month.
Can I hire employees as an Individual Entrepreneur?
Yes, you can hire employees, but you must withhold 20% personal income tax and applicable pension contributions from their salaries.
Detailed Tax Rates
Corporate Income Tax
| From | To | Rate |
|---|
Georgia applies a 15% corporate tax only on distributed profits (Estonian model), while retained earnings are taxed at 0%. Note that Individual Entrepreneurs are subject to Personal Income Tax instead.
Personal Income Tax (Top rate: 20.0%)
| From | To | Rate |
|---|---|---|
| $0 | No limit | 20.0% |
The standard personal income tax is a flat 20%. However, Individual Entrepreneurs can obtain 'Small Business Status' to pay a preferential 1% tax on gross turnover up to 500,000 GEL annually.
Capital Gains Tax
20.0%
Capital gains are generally taxed at the standard 20% personal income tax rate. Exemptions exist for residential properties held for more than two years.
VAT / GST
18.0%
Registration Threshold: GEL100,000
Non-resident companies providing B2C digital services in Georgia must register and charge 18% VAT. B2B transactions fall under the reverse charge mechanism.
Withholding Tax
A standard 5% withholding tax applies to dividends, interest, and royalties paid to non-residents. This can be reduced under Georgia's extensive network of over 55 double taxation treaties.
Payroll & Social Security
Georgia has no traditional payroll taxes. There is only a mandatory pension scheme requiring a 2% contribution from the employee and a 2% match from the employer. Self-employed individuals contribute 4%.
Other Taxes
Property Tax
An annual property tax of up to 1% applies to the assessed value of real estate, depending on the owner's total family income.
Dividend Tax
A 5% tax is levied on distributed dividends for corporations. However, Individual Entrepreneurs can withdraw their after-tax profits freely without this additional dividend tax.
Incentives & Support
Small Business Status (SBS)
A preferential tax regime allowing qualifying entrepreneurs to pay a significantly reduced tax rate on their gross turnover.
1% tax rate on gross revenue instead of the standard 20% personal income tax.
Eligibility: Annual turnover up to 500,000 GEL (approx. $185,000). Must apply separately after IE registration. Certain activities (e.g., management consulting, crypto trading) are excluded.
0% VAT on Exported IT Services
B2B services provided to foreign clients are generally considered outside the scope of Georgian VAT.
No VAT is charged on invoices to foreign clients, increasing international competitiveness.
Eligibility: Must provide qualifying services to non-resident entities located outside of Georgia.
Formation Requirements
Minimum Capital
No requirement
No minimum capital is required to register as an Individual Entrepreneur in Georgia.
Local Director
Not Required
100% foreign ownership is allowed. No local partner or resident director is needed.
Registered Office
Required
Virtual office allowed. $100-200/year
Notarization Required
Yes
Power of Attorney (Remote)
Required
Required if registering through a representative without visiting Georgia. Must be notarized and apostilled/legalized in your home country.
Timeline
Standard: 2-3 business days days
Expedited: 1 business day days ($50)
Required Documents
- 1Passport copyApostille needed
- 2Power of Attorney (if registering remotely)Apostille needed
- 3Consent letter from the legal address property owner
- 4Registration Application Form
- 5Application for Small Business Status (filed at Revenue Service)
Compliance & Reporting
Annual Filings
Monthly Turnover Declaration
Penalty: Fines apply for late or missed filings, even if the monthly income is zero.
Annual Income Tax Return
Penalty: Late filing penalties and interest charges accrue on unpaid taxes.
Audit Requirement
Not Required
Not required for Individual Entrepreneurs.
Accounting Standard
Cash Basis (for Small Business Status)
Tax Return Deadline
Monthly by the 15th; Annual return by April 1
VAT Filing Frequency
Monthly (if registered)
Data Protection
Must comply with the Georgian Law on Personal Data Protection.
Banking & Payments
Bank of Georgia
Remote-friendlyOne of the largest banks in Georgia. Offers excellent digital banking, multi-currency accounts, and premium 'SOLO' banking. Remote opening is possible via Power of Attorney.
TBC Bank
Remote-friendlyA major traditional bank with strong business tools and a premium 'Concept' tier. Supports remote account opening via Power of Attorney.
Credo Bank
Popular among expats and non-residents due to slightly more relaxed initial KYC requirements, though physical presence is usually preferred.
Payoneer
Remote-friendlyA global fintech widely used by Georgian IT contractors and freelancers to receive USD/EUR payments from international clients.
Payment Gateways
PayPal, 2Checkout, Paddle, UniPAY, Payze
Currency
GEL
Multi-Currency: Supported
Account Opening
Opening a bank account in person is straightforward and usually takes 1-3 days. Remote opening is possible via a notarized and apostilled Power of Attorney, though banks have increased KYC scrutiny for non-residents. Multi-currency accounts (GEL, USD, EUR, GBP) are issued by default.
Practical Information
Timezone
UTC+4
Business Language
Georgian, English
Legal System
Civil law
Ease of Doing Business
#7
IP Protection
Georgia is a member of WIPO and a signatory to the Paris Convention and TRIPS. The National Intellectual Property Center (Sakpatenti) handles registrations, offering standard protections aligned with EU regulations.
Double Tax Treaties
58 countries
Notable treaties: United Kingdom, United Arab Emirates, Turkey, Germany, Israel, Estonia
Visa & Residency Options
1-Year Visa-Free Regime
Citizens of over 95 countries can enter, reside, and work in Georgia visa-free for up to 365 days. A simple border run resets the clock.
Work Residence Permit
Available for Individual Entrepreneurs generating at least 50,000 GEL (approx. $18,500) in annual turnover. Requires a Special Labour Permit under the 2026 regulations.
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Changelog
Data updates and changes on this page
Verified 2026 Small Business Status thresholds (500,000 GEL) and 1% tax rate. Updated remote formation steps and banking KYC requirements.
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