Georgia has become a popular destination for entrepreneurs because of its strategic location, low‑tax regime, and streamlined registration process. Below is a concise guide to the most relevant legal and fiscal aspects of setting up a company in the country.
Business entities
Georgian law recognises six types of entities:
| Entity | Typical use | Key features |
|---|---|---|
| Individual Entrepreneur (IE) | Sole‑proprietorship | Simple registration, personal liability |
| General Partnership (GPE) | Two or more partners | Unlimited joint liability |
| Limited Partnership (LP) | General + limited partners | Limited partners’ liability limited to contribution |
| Limited Liability Company (LLC) | Most common for SMEs | Liability limited to share capital, no minimum capital, 1‑50 shareholders, can be wholly foreign‑owned |
| Joint Stock Company (JSC) | Larger enterprises, public offerings | Shares can be listed, flexible capital structure |
| Cooperative | Member‑owned ventures | Democratic governance |
LLCs and JSCs are preferred because they combine limited liability with flexible corporate structures and have no statutory minimum capital.
Registration process
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Prepare documentation
- Valid passport(s) of shareholders and director(s)
- Shareholders’ agreement (must contain company name, shareholder IDs, email, legal address, director ID)
- Legal address in Georgia (can be a virtual office)
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Submit to the Entrepreneurial Registry
- Georgia’s “single‑window” system processes applications within 24 hours.
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Obtain identification number (tax ID).
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Open a corporate bank account
- Typically takes 2–10 days after registration. Georgian banks support international transactions and online banking.
Tax regime
| Tax | Rate / Feature | Notes |
|---|---|---|
| Corporate income tax | 15 % | Applied only when profit is distributed (Estonian model). |
| VAT | 18 % | Mandatory when annual turnover exceeds 100 000 GEL. |
| Dividends | 5 % (may be reduced) | Double‑taxation treaties can lower the effective rate. |
| Personal income tax | 20 % | Residents taxed only on Georgian‑source income. |
| Territorial system | Only Georgian‑source income taxed | Foreign‑source income of residents is exempt. |
| Zero‑tax status | Available for CIS and Virtual Zone companies | No corporate tax on qualifying activities. |
| IT‑Zone (Ritual Zone) status | 0 % profit tax & 0 % VAT | Applies to companies providing exclusively IT services/products to clients outside Georgia. |
| Remotely from Georgia (for freelancers & individual entrepreneurs) | 1 % tax | Requires monthly tax declaration; intended for remote workers and digital nomads. |
Georgia has signed double‑taxation agreements with more than 57 countries and bilateral investment treaties with 32 countries, helping to avoid double taxation for both individuals and companies.
Practical considerations
- No minimum capital: You can launch an LLC with a nominal amount (even 1 GEL).
- Foreign ownership: No requirement for local partners; a single foreign shareholder can own 100 % of the company.
- Annual compliance: Registration is a one‑off event; there is no mandatory annual renewal, though accounting and tax filing remain obligatory.
- Banking: Choose a bank that offers robust online services and supports multi‑currency accounts if you plan to receive payments abroad.
- Tax optimisation:
- Use the Estonian model to defer corporate tax until profit distribution.
- Consider the IT‑Zone status if your business is purely digital and serves overseas clients.
- Evaluate the Remotely from Georgia regime if you operate as a freelancer or sole proprietor.
- Compliance risk: Misclassifying activities (e.g., claiming IT‑Zone status while providing non‑IT services) can trigger penalties. Maintain clear documentation of the nature of your services.
Decision checklist
- Entity choice – LLC for most SMEs; JSC if you need share issuance.
- Capital – No minimum, but ensure sufficient funds for initial operations.
- Tax regime – Determine whether the Estonian model, IT‑Zone, or Remotely from Georgia applies.
- Banking – Open a corporate account promptly; verify the bank’s international transfer fees.
- Legal address – Secure a local address (physical or virtual) to satisfy registration requirements.
By following these steps and aligning your business model with Georgia’s tax incentives, you can establish a company quickly and benefit from one of Europe’s most business‑friendly environments.
