During an era defined by rapid economic changes, Georgia has emerged as a pioneer.
A few years back, the Georgian Tax Authorities introduced a revolutionary law that's been creating quite a stir, capturing the curiosity and attention of business leaders.
Let's dive into the secret behind the buzz – the highly sought-after International Company Status.
As defined in the Georgian Tax Code, an international company is a Georgian enterprise engaged in activities specified by the Government of Georgia. Its sole source of income must originate exclusively from these designated activities.
To qualify for international company status, Georgian enterprises must meet specific criteria:
1. A minimum of 2 years of experience in approved activities.
2. Georgian companies can also represent non-resident enterprises in Georgia, provided the non-resident enterprise has at least 2 years of experience in approved activities.
3. Georgian enterprises can have partner enterprises holding more than 50% ownership, as long as the partner(s) possess a minimum of 2 years of experience in approved activities.
The benefits of international company tax rates in Georgia are substantial. They include:
- A reduced profit tax rate of 5%, significantly lower than the standard 20%.
- A 5% income tax rate on employment income, as opposed to the regular 20% rate.
- Tax-free dividends from international companies, exempt from being counted as part of the recipient's gross income.
- Property tax exemptions, excluding land used for activities permitted by the Georgian government's decree, offering further financial advantages.
To embark on the journey toward achieving international company status in Georgia, start by submitting an application, either in writing or electronically, to the Revenue Service under the Ministry of Finance. This institution, appointed by the Georgian government, holds the authority to grant this coveted status.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.