If you meet the qualifications to be eligible for Micro Business Status (Gross turnover under 30,000 GEL annually, no employees, not on the prohibited list of activities (see below), etc.) then you can apply for Micro Business Status.
You will pay 0% tax on eligible gross turnover once you are approved for Micro Business Status.
If your sole proprietor business will turnover more than 30,000 GEL (~$10,000 USD) annually, then you will need to register as a Small Business, rather than as a Micro Business.
If you already have access to your personal revenue service portal, you can apply for Micro Business Status online through the portal.
How To Register A Micro Business
Define your main business activities. The full list of recognized activities can be found here. It must not be an activity from the prohibited list.
Visit the Revenue Service office with your:
- Georgian Phone Number
- Revenue Service tax ID number (if you have one)
If you do not already have a tax ID, fill out the application to get your personal tax number.
It is also recommended that you ask the clerk to help set up your account on the Revenue Service’s online tax portal.
Request and fill out the Micro Business application. Most agents speak basic English, but if you are going to have questions about the process or your tax situation, it is best to ask a professional bilingual tax adviser before visiting the office, and/or to visit the Revenue Service with a fluent Georgian speaker to aid you.
If accepted, you will receive a certificate and benefit from Micro Business Status from the 1st day of the next calendar month. You are required to fill out and submit a simplified version of the annual income declaration before April 1st each year.
- If you become ineligible for the Micro Business Status at any point (i.e., because your gross turnover exceeds 30,000 GEL, or you start hiring employees), you need to urgently submit a request and register as a Small Business within a maximum of 15 days. If you don’t, your Micro Business Status will automatically be canceled and you will return to paying regular taxes (20% on net income) in accordance with Georgian Tax Code Articles 79 and 82.
- If your Micro Business stops economic activities, you need to submit an annual income declaration within a maximum of 30 days.
According to the Resolution of the Government of Georgia №415, Micro Business Status is not granted for these activities:
- Activities that require specific licensing or permission;
- Currency exchange operations;
- Medical, architectural, legal, or notarial, auditing, consulting activities of ANY kind (including tax consultants);
- Gambling Business;
- Engaging in activities that require a significant investment, or engaging in the production of excisable goods.
- Income from employment of any kind (or activities which clearly resemble employment) will be excluded from the 1% tax regime. In other words, you can still be employed, but that income will be taxed at 20% as normal, and not included in your micro business 0% taxable income.
Important: You are liable to make the above determination yourself as to if you qualify. The revenue service approving your application does not constitute any liability on their part. If you violate the terms of the status, you are personally liable for back taxes and penalties and are not in any way protected by the fact the status was approved in the first place.
If you expect to start turning over more than 30,000 GEL within any tax year (Jan 1st to Dec 31st), you should also download our free Small Business Status Registration Guide: