Tax on selling a car in Georgia: 6 months and 5%

You only pay tax on selling a car if you owned it briefly and sold it at a profit. The rule differs from flats: the key period isn't 2 years but 6 months.

The main rule

• If you owned the car for more than 6 months from registration of ownership, the gain from selling it is tax-free (Tax Code, Article 82)
• If less than 6 months — the gain is taxed at 5% (Article 81)
• Only the gain is taxed — the difference between the sale and purchase price, not the whole amount
• If you sold at the same price or at a loss, there is no tax

For example: you bought a car for GEL 20,000 and sold it 3 months later for GEL 23,000. The gain is GEL 3,000 and the tax GEL 150. If you sell it after 7 months, there is no tax.

Cars brought from abroad

The 6 months run from registration of ownership in Georgia. If you imported a car and sold it at a profit within 6 months of registration, the gain is taxed. Keep documents proving the purchase price.

Buying and selling cars often?

If buying and selling cars is your regular activity, it may count as a business and be taxed differently — for example, as an individual entrepreneur. In that case, plan the tax side in advance.

A car received as a gift or inheritance

When you sell such a car, the gain is the difference between the sale price and its market value on the day you received it. The 6 months run from registration in your name. First- and second-degree relatives pay no tax on receiving it.

The tax return

If tax is due, file a return with the Revenue Service by 1 April of the year after the sale (Article 153). This applies to non-residents too.

Re-registering the car

To transfer the car, you submit to the MIA Service Agency the ownership document, ID, the inspection report and a joint application. If one party can't attend, a power of attorney expressly allowing the sale of the car is needed.

How we help

• We calculate the tax and check the 6-month period
• We draft or review the sale contract
• We help with the tax return
• In a dispute, we represent you before the Revenue Service

Tax lawyer