Georgia – Tax (Free) Residency

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ABOUT GEORGIAN TAX RESIDENCY

We all want to find legal ways to reduce our yearly tax burden. For many of us, that means establishing our homes and/or businesses in low-tax countries. The good news is that most countries with low-tax systems are actively trying to attract wealthy individuals and the business expertise that they bring. The money you earn outside of Georgia will be yours to keep. So long as you limit the portion of your total income earned in Georgia you will certainly pay less in taxes, with the possibility of eliminating your tax obligations entirely. While it’s certainly not a “tax-free” country in the same vein as Panama, the British Virgin Islands or the Cayman Islands, it is what we define as a low-tax country. Georgia has one of the most straightforward and liberal tax regimes as the authorities have made it fairly easy to establish tax residency.

Eligibility for Tax Residency in Georgia
The process is surprisingly simple. Any individual living in Georgia for 183 days during a consecutive 12-month period is eligible to apply for tax residency. In the vast majority of cases these applications are accepted.
Of course, you may not be able or interested in spending half a calendar year in Georgia. Fortunately, the government has created a special regime for those designated as “high net-worth individuals.”
Someone is considered to be high net-worth if: 1) the value of his/her confirmed property is greater than GEL3,000,000 (approximately $1.35 million); or 2) his/her annual income exceeded GEL200,000 (about $90,000) in any of the three previous years prior to the year they submit the application.
There are a few other conditions that must be met, however. The applicant must obtain either a Georgian residency permit, Georgian nationality or the applicant must verify receiving at least GEL25,000 (just over $11,000) of income in a single year from a Georgian company.
Bear in mind that obtaining a Georgian residence permit is relatively easy for someone earning Georgian-source income of any significant amount, so the first option is practicable in most cases.

Zero tax opportunity in Georgia
“Fortunately, the Georgian government has created a special regime for those designated as high net-worth individuals.”

BENEFITS OF GEORGIAN TAX RESIDENCY

  • 0% foreign source income tax; with the correct corporate structure and tax plan it is possible to avoid most income taxes.
  • Georgia is one of the most free economies and the pro-business government has been reducing taxes year after year from 21% to 5%
  • Simple process and 0% tax residency for High-Net-Worth individuals if personal property is valued at more than GEL 3,000,000 or annual income exceeded GEL 200,000
  • Low tax residency available for applicants who can verify at least GEL25,000 of Georgian source income

DISADVANTAGES

  • Temporary residency has to be renewed for the first time after 6 months
  • Georgia and Tbilisi are a remote location from many European cities

REQUIREMENTS FOR THE GEORGIAN RESIDENCY

Proof of identity – Valid Passport or national ID-card

Proof of accommodation – deed or lease agreement; Novasigma will prepare an agreement with the landlord, we can introduce specialist real-estate companies and we will also have a notary attest the agreement. The rental agreement can also be prepared and provided by our local law firm. The client is not under any obligation to rent or buy any real-estate.

Proof of employment – employment contract with a Georgian entity. The employment contract can also be prepared and provided by our partner company. Furthermore, it is possible to apply residency with a self employment status if applicant is the director and shareholder of a Georgian company.

Proof of sufficient funds – bank reference issued by a Georgian bank stating that you have sufficient funds to support your stay in Georgia without relying on the Georgian social system; a deposit of 1.200-15.000 EUR into client’s Georgian bank account is required as proof. Once the bank issues a reference letter confirming that the funds are present, it is possible to withdraw the deposited funds.

Timeline – Process takes up to 2 weeks and requires at least one visit to Tbilisi, Georgia

OUR SERVICES

OUR EXPERIENCED CONSULTANTS AND LOCAL ATTORNEYS WILL HELP YOU FILL ALL REQUIREMENTS AND ASSIST YOU DURING EVERY STEP OF PROCESS.

  1. Consultancy before applying residency; (min. 5h assignment at 180€ per hour)
    1. Does this solution fit you and your future plans?
    2. Are you able to fill all requirements now and in the foreseeable future?
    3. How much can you effectively save in taxes when compared to your current situation?
  2. Assistance preparing the required set of application documents
  3. All inclusive service when visiting Georgia (full service description available upon request)
  4. Support after relocation

GOOD TO KNOW & ESTIMATED EXPENSES

  • Georgian tax residency will fit you if your personal property is valued at over EUR 1 million or your tax-free income from countries foreign countries will exceed EUR 80,000 per year
  • If you want to receive a Georgian ID card (recommended if you have offshore accounts or companies in other countries) you have to visit in Tbilisi at least 3 times during the period of 3 months
  • The whole process to obtain Georgian residency will cost approximately 5-10.000€ depending on your personal circumstance. If you currently reside in a high tax jurisdiction you will save around EUR 30,000 – 40,000 for every EUR 100,000 in taxable income.
  • Depending your current tax residency it may take 6 months or up to 3 years before you will be free from your old tax residency. Please contact our tax advisors to find solutions on how to reduce tax burdens effectively with the least amount of time.

 

IS THIS FOR YOU? LET’S TALK!

Before changing your tax residency you should be sure that the chosen country is really suitable for you. We strongly recommend you use our TAX PLANNING SERVICE before making any decisions. In most cases we can find alternative solutions for our clients which are more cost effective. Always feel free to contact us for a quote. Simply send your contact details and a short brief about your current situation and time frame so we can reach out to you with a quote.

PROPERTY INVESTMENT PROJECTS IN GEORGIA

  • investing opportunities in georgia
    King David Skyscraper - Invest in Luxury Apartments - Georgia

 

ABOUT GEORGIA

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