Guide to income tax rates in Georgia and how to fill your tax returns (2024)

Georgia recognizes the crucial role small and medium-sized enterprises (SMEs) play in driving economic growth and creating jobs. To support these vital engines of innovation, Georgia has designed a tax system that actively encourages entrepreneurship. This welcoming approach applies to local startups and international businesses establishing a presence in the country.

Taxes in Georgia won't cripple your growth. The focus is on competitive rates and smart incentives, including special tax breaks for small and medium-sized businesses.

Here payroll management is also simple. Georgia's system is designed for simplicity, with straightforward income tax withholding and reasonable pension contribution requirements.

What are the income tax rates in the Country of Georgia?

Georgia's income tax system aims for a balance of fairness and growth. Individuals face a flat 20% rate, while businesses benefit from special breaks designed to help them flourish. Small and micro businesses could see income tax rates as low as 1% or 3%.

• Rental Income: If you earn money renting out residential property in Georgia, you'll face a simple 5% tax rate.
• Property and Vehicle Sales: Selling a house, apartment, or vehicle in Georgia? The proceeds are generally taxed at a 5% rate, but specific exemptions might apply.
• Capital Gains (Foreign Investments): Selling stocks, bonds, or other non-Georgian securities usually results in a 0% tax on your gains. (Always consult a tax professional for complex situations.)
• Cryptocurrency Gains: Currently, cryptocurrency gains in Georgia are taxed at 0%. This reflects the evolving legal status of crypto in the country.

Foreign Dividends: If you're a passive shareholder receiving dividends from foreign companies, you typically won't pay any Georgian tax on them (0%). However, managing a foreign company from Georgia can complicate the situation.

Filing your Georgia tax return

1. Complete your federal tax return. This provides the necessary information for your Georgia return.
2. Gather documents: You'll need your federal return, Social Security Number (or Tax ID), and all Forms W-2 or 1099 (one for each job you worked during the year). Depending on your income sources, you may need additional forms.
3. Choose a filing method:

• E-file: Use tax preparation software for convenience and speed.
• Georgia Revenue Service: File directly through their website.
• Paper forms: Mail in your completed tax forms.
• Tax preparer: Consult a professional for assistance.