How Georgia's Tax System Works

Outline

• Tax residency and why it matters
• Taxes when buying and owning property
• Taxes on rental income and property sales
• Special regimes for small business and developers
• Practical steps for buyers and investors
• Tips to reduce risk and next checks

Introduction

Georgia's tax framework is designed to be investor-friendly and straightforward, but details matter for those buying or renting property in Batumi and beyond. This guide highlights common tax points and practical steps to stay compliant.

Tax residency

Whether you are considered a tax resident determines which income must be reported in Georgia. Confirm your status with a tax advisor: it affects whether global income or only local sources are taxable.

Buying and owning property

When purchasing, account for notary and registration fees, possible transactional levies, and whether the developer applies VAT or another tax regime. Annual property-related local charges exist and should be included in running-cost projections.

For developers and new builds, tax treatment can differ from private sales — clarify terms in the sale contract and ask for written confirmation of any taxes the seller or developer will handle.

Rental income and sales

Rental income is generally taxable; keep records and invoices. Sales can trigger tax consequences depending on the holding period and the owner’s legal form. Companies may follow a different corporate tax approach, particularly regarding retained vs distributed profits — seek tailored advice.

Small business regimes

Georgia offers simplified options for small entrepreneurs and certain legal forms, which may lower compliance costs for landlords and small-scale developers. Check eligibility criteria before relying on any simplification.

Practical steps

1. Talk to a local accountant and lawyer before signing.
2. Verify title and seller background in public registers.
3. Obtain a tax identification number and register the transaction properly.
4. Factor taxes into your investment cash-flow model.
5. Consider holding structures if investing long-term.

Risk reduction and checks

• Ask the seller for all tax receipts and proof of paid fees.
• Confirm whether VAT or similar applies to your purchase.
• Compare taxation as an individual vs a company.

Conclusion and next steps

Taxes should be part of your acquisition plan, not an afterthought. Use local professional help to optimise the structure lawfully. For related reading and internal reference see /how-tax-system-works-georgia and /saqartvelo-nalogi-sistema.

If you're planning a purchase in Batumi, consult with our team to review tax scenarios — the right structure often pays for itself.