The attractiveness of Georgia among foreign freelancers, especially from the IT sector, is growing rapidly. The loyal attitude of regulatory authorities, low taxes, and ease of registration contribute to the active use of Georgian individual entrepreneurs for servicing international contracts by programmers from different countries.
Individual entrepreneur registration in Georgia with small business status makes it possible to reduce tax expenses significantly. The tax rate for persons with such a status is only 1% of gross revenue per year, and there are no other mandatory payments.
You can use such an effective tool to service international transactions. Registration will take only three working days and is absolutely remotely. In addition to an individual entrepreneur in Georgia, we recommend opening an account in a payment system to ensure timely receipt of funds. As a result, you will save time and money, and in return, you will receive a full-fledged tool for conducting transactions with foreign counterparties.
Benefits of Georgia for doing business
When looking for jurisdictions with favorable conditions for IT businesses and freelancers, we recommend paying attention to Georgia for the following reasons:
- ease of registration and starting business
- friendly attitude towards foreigners
- remote registration of an individual entrepreneur on a turnkey basis
- no corruption and transparent taxes
- minimal contacts with tax and regulatory authorities
- absence of any requirements for an individual entrepreneur
- excellent geographical location
- beneficial taxation system
- no automatic exchange of financial information
Find out more about the business opportunities opening up in Georgia.
Basic Georgian corporate laws
Opening an individual entrepreneur in Georgia and doing business in the country is regulated by the following laws:
- Tax code
- Law of Georgia on Entrepreneurs
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Features of a Georgian individual entrepreneur
Georgian individual entrepreneur in its characteristics is no different from a similar form of business in other countries. Essentially, this is an individual who conducts business activities on their behalf at their own risk and accordingly is responsible for fulfilling obligations to creditors with their personal assets.
The moment of creating an individual entrepreneur in Georgia is the appearance of an entry in the Public Register of Entrepreneurs and Non-Entrepreneurial (Non-Commercial) Legal Entities.
Mandatory payments for individual entrepreneurs:
- standard tax rate for individual entrepreneurs in Georgia – 20%
- VAT at the rate of 18% – for annual turnover over GEL 100,000 (about USD 30,000)
- contributions to the pension fund are withheld only from residents – 2% employee and 2% employer
Small business status
According to local legislation, foreign citizens can register individual entrepreneurs and receive a small business status in Georgia. Due to this, non-residents get the opportunity to reduce the tax burden to 1%, provided that the annual turnover does not exceed GEL 500,000 (about USD 150,000). Above this amount, the tax is charged at 3%.
If turnover exceeds the specified limit during two periods in a row, the small business status will be canceled.
In addition to the 1% revenue tax, non-resident individual entrepreneurs in Georgia do not have to pay other taxes and social contributions to the country. Such favorable conditions make it attractive to use small business status to receive stable payments from foreign counterparties.
Attention! If you have small business status, the maximum amount of tax, based on a turnover of GEL 500,000 per year, is only GEL 5,000 (about USD 1,500).
Restrictions on small business status
Small business status does not allow you to engage in certain activities, including:
- any activities subject to licensing
- activities requiring significant investments
- currency and foreign exchange transactions
- medical activities and medical services
- scientific work and research
- lawyer, notary, audit, and consulting activities (including tax consultations)
- production of excise products
- agriculture and forestry
How to open an individual entrepreneur in Georgia
A freelancer from any country or a stateless person can register an individual entrepreneur in Georgia. To do it, you need to contact the local House of Justice with a passport or go through the entire procedure remotely with the help of a trusted representative. This option will allow you to avoid wasting time and money on trips to Georgia.
The main difficulties arising in individual entrepreneur registration:
- Border crossing – although Georgia has special programs Remotely from Georgia and Business Proposes allowing foreign businesspersons to cross the border, they provide for mandatory expenses. You can avoid these expenses by using the services of a trusted representative.
- Not knowing the Georgian language – all documents for registering an individual entrepreneur in Georgia are filled out in Georgian.
- Legal address – there is a requirement to confirm a legal address in Georgia (notarized consent of the property owner, lease, hire or sale agreement, etc.).
By contacting us for help, it will be possible to solve the above issues and save time and money. We will promptly prepare all the necessary documents and open a private entrepreneur within three working days.
The procedure for registering an individual entrepreneur in Georgia
Conventionally, the process of registering a private entrepreneur in Georgia can be divided into the following stages:
- Sending us a notarized passport copy and a power of attorney.
- Submitting an application for registration to the House of Justice by our lawyer.
- Fee payment: GEL 50 for express registration or GEL 20 for standard (the registration statement will be ready the next day).
- Tax registration with the Revenue Service and application for small business status.
Does a foreign entrepreneur need a bank account in Georgia?
In recent years, foreign businesspersons have been constantly faced with difficulties in opening accounts, especially corporate ones, in Georgian banks. This creates certain obstacles while doing business, but it is very easy to avoid them.
Georgian legislation does not prohibit an individual entrepreneur from having accounts in foreign banks or payment systems. Thanks to this, foreign IT specialists and freelancers can easily register an individual entrepreneur in Georgia and receive periodic payments. A non-resident entrepreneur independently indicates information about turnovers in payment systems and foreign accounts in declarations and independently calculates and pays taxes.
Contact our experts to learn more about the opportunity to open an account in a payment system for an individual entrepreneur in Georgia.
Entrepreneurial reporting in Georgia
Georgian legislation obliges individual entrepreneurs to submit the following reports:
- monthly – by the 15th day of the following month
- annual – by April 1
Submission of reports and payment of taxes is carried out remotely via the taxpayer’s personal online account.
It is not difficult to pay taxes and fill out declarations from any country. However, in order not to miss the deadlines, we recommend you to use the services of a professional accountant who will provide high-quality and timely business administration.
An individual entrepreneur with small business status in Georgia and an account in a payment system is an ideal combination for receiving periodic payments for employees, freelancers, and programmers. If you have revenue up to USD 150,000 annually, the tax will be only 1% with no additional costs.
Reasons to register a Georgian individual entrepreneur:
- Speed of registration – it will be possible to register an individual entrepreneur in 3 working days.
- Available remotely and can be controlled from any country.
- Minimum reporting – only monthly and annual declaration.
- It is not necessary to have an account in a Georgian bank.
- Simpler alternative to Virtual Zone Person and International Company.
- Georgia does not exchange financial information with other countries.
- A foreign entrepreneur independently fills out declarations based on receipts to foreign accounts and calculates taxes.
Our other services in Georgia:
- Open a Non-Resident Personal Account with a Bank in Georgia in 2022
- Corporate Non-Resident Bank Accounts Setup with Silk Road Bank in Georgia, Remotely
- IT Company Registration in Georgia (3 Days): the Turnkey Business Package Offer
- Offshore Business Registration in the TFZ, Tbilisi, Georgia: 3 Days
- Start Companies for Manufacturing «Made in Georgia» Goods
- Company Incorporation in Georgia: Kutaisi Free Industrial Zone (Kutaisi FIZ)
If you are interested in opening an individual entrepreneur in Georgia with small business status, please contact us now via the online chat or leave a message in a special form. We will reply to you as soon as possible.
Can a foreigner register an individual entrepreneur in Georgia?
Yes, local legislation allows non-residents and stateless persons to register individual entrepreneurs.
How long will it take to register an individual entrepreneur in Georgia?
It will be possible to open an individual entrepreneur in 2-3 working days.
How long will it take to open an account in a payment system?
The terms for opening an account depend directly on the regulations of the chosen payment system. Usually, it takes up to 1 week.