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Registration of tax residence in Georgia

Tax residence in Georgia

2020-10-19
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Getting a tax residence in Georgia is beneficial, as it is possible to optimize taxation in the country. Compared to other countries, Georgia's tax system is the most loyal to entrepreneurs and does not interfere with business development.

What is tax residency

Tax residence means ownership of a company or individual in the tax system of a particular country. It indicates the system under which a person pays taxes. A tax resident is registered with the tax authorities of the country where the status was obtained. Subsequently, he/she pays taxes.

It is important that the country of which the person is a citizen enter into double taxation avoidance agreements, only in this case it is possible to optimize payments. Obtaining tax resident status is relevant when an individual or organization seeks to reduce the tax burden.

Pluses of obtaining tax residency

Tax residency in Georgia has many advantages for both individuals and legal entities. It is beneficial for businessmen, as tax rates are low and various benefits are offered. There are no taxes on income received from Georgian sources. The tax from renting out real estate is minimal, starting at 5%. Preferential tax rates apply to cryptocurrencies.

It is profitable to register companies in this country. The Estonian tax model is based on the principle that corporate fees will be retained only when income is distributed. It is possible to register a rate of 0 percent on dividends, if they were received from foreign organizations. These advantages can be used only after registration of tax residence in the country.

How to obtain tax residency status

One of the standard ways to get a tax residence for an individual is to live in the country for at least 183 days during a year. This method has a number of disadvantages - obtaining residence takes a long time, it will not be possible to quickly solve the issues of tax optimization.

It is possible to obtain the status of a person secured with significant property. Its availability makes it possible to get a residence faster - within a month. This will require proof of presence:

  • Assets over 3 million lari;
  • Annual income from 200 thousand lari for the last 3 years;
  • Residency permit in the country;
  • Income from a source in Georgia from 25 thousand lary.

According to the laws of the country, a company registered in Georgia or managed from it will be considered a resident. To reduce tax burden, it is possible to register an IT business in the FEZ zone. Please contact our specialists AT IT-OFFSHORE with regard to tax residence registration.

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