Individual entrepreneur in Georgia: the 1% tax for foreigners

An individual entrepreneur (IE) with small business status is the simplest way to start a business in Georgia, so it is popular with foreigners — especially freelancers. But there are details you should know in advance.

Registration

1. You register as an individual entrepreneur at the Public Service Hall — you need your passport and a legal address in Georgia.
2. If the address isn't yours, you need the owner's consent.
3. After registration, you apply to the Revenue Service for small business status.

How the 1% works

• With small business status, the tax is 1% of income if your annual income does not exceed GEL 500,000
• If your annual income passes GEL 500,000, all your income is taxed at 3% from the start of that month until the end of the year
• You file a declaration and pay the tax every month, by the 15th of the following month

What the 1% doesn't cover

Not every activity qualifies — the Government keeps a list of excluded activities. Rent, interest, dividends and similar income are not taxed at 1% either. Choosing the wrong activity is a common reason for losing the status and paying extra tax.

What changed in 2026

Since 1 March 2026, a foreign individual entrepreneur, as a self-employed person, also needs the right to labour activity — and a suitable residence permit or visa — to work in Georgia. Registering as an IE alone is no longer enough.

Tax residency

You become a Georgian tax resident if you spend 183 days or more in Georgia in any continuous 12-month period. Residency affects where and how your income is taxed, so it should be assessed together with the rules of your home country.

How we help

• Choosing the right activity and registering
• Getting small business status
• The right to work and a residence permit
• Disputes with the Revenue Service

Corporate lawyer