Map transactions before relying on rates
The Tax Code sets a 15% profit-tax rate for the general corporate regime, commonly applied to distributed profit and specified deemed distributions, an 18% VAT rate, and a general 20% rate for a natural person’s taxable income. Exceptions, exemptions, gross-up mechanics, withholding and special regimes can materially change the result.
Core business-tax map
| Area | Headline rule | Questions before action |
|---|---|---|
| Corporate profit tax | General rate 15%; taxable objects include distributed profit and specified non-business or deemed distributions. | Is the payment a dividend, related-party expense, benefit, loan, write-off or non-business cost? |
| VAT | 18% on taxable turnover/import and reverse-charge transactions, subject to exemptions and zero-rating rules. | Registration status, place of supply, input deduction, invoice and import documentation? |
| Employment and individuals | General personal income-tax rate 20%, with special rules and rates for defined income. | Employee or contractor, residence, benefits, stock/bonus, remote work and withholding? |
| Dividends / interest / royalties | Source-tax rules and exemptions differ by payment and recipient. | Recipient status, treaty, beneficial ownership, documentation and anti-avoidance? |
| Property and customs | Property tax is fact-specific; imports may trigger VAT, import duty and excise depending on goods and procedure. | Asset ownership, customs code, origin, value, relief and permits? |
Distributed-profit model
Retained operating profit is not simply the same as taxable distributed profit. The Tax Code identifies distributed profit and other taxable objects, including certain expenses or payments not connected with economic activity and specified gratuitous or representative expenditures. The calculation rules can use a gross-up mechanism.
- Approve and document dividends correctly.
- Separate business expenses from shareholder or director benefits.
- Document related-party services, loans, write-offs and non-cash transfers.
- Reconcile accounting profit, cash movements and taxable distributions each month.
- Review whether a sector-specific regime—such as for banks or gaming—changes the general rule.
VAT and cross-border services
VAT analysis should be completed before the first invoice or import. Determine the supplier, customer status, place of supply, reverse-charge exposure, taxable base, exemption or zero-rating evidence and input-VAT recovery. A foreign supplier can still create Georgian VAT consequences for the Georgian recipient.
Do not use turnover alone as the only VAT test. Imports, reverse charge, voluntary registration, exempt activities and special transactions require separate review.
Payroll, contractors and permanent establishment
A contract label does not determine tax treatment. Assess control, integration, workplace, equipment, exclusivity and commercial risk when distinguishing employment from independent services. A Czech company’s staff or dependent agents operating in Georgia may also create permanent-establishment or payroll questions.
- Register payroll and withholding processes before the first payment.
- Document benefits, reimbursements, travel and expatriate packages.
- Coordinate immigration, employment law and tax residence.
- Review double-tax treaty relief and certificate requirements before applying it.
Special regimes are eligibility tests
Free Industrial Zones, International Company status, Virtual Zone status, small-business status and other regimes have different legal subjects, permitted activities, territorial or customer restrictions, documentation and ongoing conditions. A low advertised rate is not a substitute for an eligibility opinion.
For export manufacturing and logistics, read the Free Industrial Zones guide. For a broader comparison, see preferential tax regimes in Georgia.
Tax-control checklist
- Transaction map by revenue, procurement, payroll, financing, assets and distributions.
- Tax calendar with named preparer, reviewer and payment owner.
- Contracts and invoices aligned with actual delivery and customs evidence.
- Related-party register, pricing method and support for management/service charges.
- Treaty certificates and recipient documentation obtained before payment.
- Reconciliations between bank, accounting, tax returns and customs declarations.
- Change log for new products, countries, employees, warehouses and licences.
Use current Revenue Service rulings and legal updates for transaction-specific positions
The Revenue Service continues to issue public rulings, administrative updates and taxpayer guidance during 2026. For unusual distributions, restructurings, special-status transactions or cross-border arrangements, check the current ruling and legal-update record in addition to the consolidated Tax Code before filing or pricing the transaction.
Frequently asked questions
Frequently asked questions
Is Georgia’s corporate tax simply 15% of annual accounting profit?
Not generally under the distributed-profit model. Taxable objects include distributions and specified deemed distributions or non-business payments; calculation and exceptions must be reviewed under the Tax Code.
Is every Georgian invoice subject to 18% VAT?
No. Taxability, place of supply, registration, exemptions, zero-rating, reverse charge and input deduction vary by transaction.
Does a preferential status apply automatically after incorporation?
No. Each status has eligibility, application, activity and compliance conditions. Registration of an ordinary company does not grant a preferential regime.