Individual Entrepreneur (1% Tax) Registration
Individual Entrepreneur Registration
If you intend to run a company where you are the sole proprietor, the Individual Entrepreneur (IE) with Small Business Status (SBS) in Georgia affords incredible tax benefits.
The Small Business Status (SBS) is a special tax scheme designed for Individual Entrepreneurs (IEs) registered in Georgia. It allows for those IEs to apply for the SBS and pay 1% tax on turnover up to a max annual turnover of 500,000 GEL. For many freelancers/solopreneurs, this leads to huge tax savings.
ExpatHub can assist with both your IE registration and/or SBS registration (for those who qualify). Our complete service will get you set up quickly and professionally. We'll help you easily avoid translation problems and navigate the pitfalls of Georgian law to complete your business registration without potential legal headaches in the future.
Not all IEs qualify, so read more about Individual Entrepreneur & Small Business Status in Georgia.
From:
₾600 GEL
Approx. 220 USD (+VAT when applicable)
Key Benefits of Georgian "Small Business Status"
1% tax on gross turnover
No other personal or corporate income tax to pay. If you get SBS status, in most cases, 1% is the only income tax. For IEs without SBS, 20% on net profit is taxable.
0% VAT on most foreign services
If your clients/customers are based outside Georgia: All B2B client services are exempt. B2C is also exempt if rendered electronically. (Exemptions apply, so consult our tax advisor)
Legal residency not needed
You do not need to be a legal resident or citizen of Georgia. You should be (or become) a tax resident though.
Requirements for Opening a Georgian IE/SBS
Required On The Day, To Apply In Person:
To Qualify For The SBS (1% Tax Rate):
* All sole proprietors qualify for IE registration
** Note: The business does not need to operate from the legal address location.
*** If you are on the prohibited list, you can still get the Individual Entrepreneur status (20% flat tax on net annual profit), but will not qualify for the Small Business Status (monthly 1% tax on gross turnover).
Individual Entrepreneur Business Registration Service
Our complete Individual Entrepreneur business registration service will get you set up quickly and professionally.
We'll help you avoid translation problems and easily navigate the pitfalls of Georgian law to complete your business registration without potential legal headaches in the future. You will be required to attend 1 appointment with our representative at the Public Service Hall in Tbilisi or Batumi.
We can assist with both Individual Entrepreneur & Small Business Status Registration.
How long does it take to register a business?
Usually, the registration takes up to 1 business day and involves a visit to the Public Service Hall.
In case of remote registration, you also have to account for notarization and Apostille/legalization of the Power of Attorney and a copy of your passport.
If I don’t qualify for SBS (1%), what are my options as an Individual Entrepreneur?
If you do not qualify for SBS (1%), you can still register as an IE, but the main difference will be that you pay 20% tax on your net annual income (declared annually) rather than 1% on your gross turnover (declared monthly).
Do I need a Georgian business bank account?
Legally, you need neither a Georgian nor a business bank account. You can use any bank account - personal, business, local, or international - provided you declare all business income accurately. You can also use Wise, Revolut, Payoneer, or other similar international financial service providers.
However, it is highly advised to have a separate bank account for business, even if it is a separate personal account, in order to differentiate your finances and avoid any issues.
Having a Georgian bank account also makes paying taxes easier.
Can I open my IE/SBS remotely with a Power of Attorney (PoA)?
A Power of Attorney could be used for a remote registration. But this turns a relatively simple process into a far more complicated one. In this case, you have to notarize and Apostille/legalize, and then send a Power of Attorney and a copy of your passport to us.
When is VAT due on my business income? What transactions are VATable?
VAT registration is mandatory if gross VATable turnover exceeds 100,000 GEL in any 12-month period. Once VAT registered, 18% VAT must be collected on all VATable transactions.
Non-VATable sales to foreign clients/customers do not count towards this threshold. They also remain non-VATable even once VAT registered.
With limited exceptions, sales of services (including SaaS) which are electronically rendered and provided to customers outside Georgia and not physically present in Georgia will be non-VATable.
All B2B (business-to-business) service transactions between a Georgian business and a non-Georgian business located outside Georgia are entirely VAT-exempt.
These are not the only non-VATable transactions. Read more about what is VAT exempt here.
Do I have to renew the registration annually?
No. Business registration in Georgia is indefinite, and there are no annual renewal fees or procedures.
Business Registration
₾600 GEL
Approx. 220 USD (+VAT when applicable)
Key Tax Information for IE/SBS
* If you ONLY qualify for IE status and not SBS (1% tax rate), then all of the above are accurate, except you will pay 20% on annual net profit, rather than 1% on monthly gross turnover.
** If employees are Georgian permanent residents or citizens, an additional 2%+2% for pensions. Employees can be from Georgia or elsewhere. Foreign employee tax situations may vary.
International Standard, Local Pricing
Why ExpatHub?
Starting life in a new country is confusing. We know because we faced all the same challenges you will, when we first moved here. But we solved those challenges and hired a team of expert, bilingual accountants and lawyers to help you get set up in Georgia, easier than ever before.
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Native English Speaking, Or Fluent Bilingual. Your Questions Will Never Be Lost In Translation.
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Fair, Transparent Pricing For Foreigners.
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We Bring An International Level Of Service, Logic, Resourcefulness, Confidentiality & Data Protection To All Our Services In Georgia.
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