Freelancer tax in Georgia: Upwork, Fiverr, foreign salary

Under Article 104 of the Tax Code, services performed in Georgia and employment carried out in Georgia are Georgian-source income. It doesn't matter where the money arrives — on Upwork, Payoneer or a foreign bank. So money received from abroad is not tax-free.

A foreign company does not withhold tax in Georgia. If you are not registered, you must report the income in an annual return by 31 March of the following year and pay 20% (Articles 81 and 153). Registering as a sole trader with small business status — 1% — is often cheaper.

Your options

Small business status — what to watch for

• The 1% covers business income only, not salary (Article 90). If you work for one company with fixed hours and under its direction, it may be treated as salary
• Consulting, legal, medical, audit, architecture and some other activities can't use the 1% (Government Resolution No. 415)
• If annual income passes GEL 500,000, all income is taxed at 3% from that month until the end of the year
• Services to foreign businesses are generally outside Georgian VAT — the place of supply is where the client is (Article 162¹)
• Pensions: an employee of a foreign employer and a sole trader count as self-employed — joining the pension scheme is voluntary

For companies: an employee who lives abroad

• An employment contract longer than 1 month must be in writing; state that the work is done remotely from abroad (Labour Code, Articles 12 and 14)
• Services a non-resident performs abroad are not Georgian-source income, so as a rule no tax is withheld; the exception is management and financial services — 10%
• How the salary of an employee working abroad is taxed depends on the details — we check it in advance, together with any double tax treaty
• A foreigner who never enters Georgia and works fully remotely doesn't need the right to work (Labour Migration Law, Article 1)
• The pension scheme doesn't cover foreigners without a permanent residence permit in Georgia