Can your company prove the history and the Georgian operation?
Established IT businesses and international groups that can prove the same permitted activity for at least two years and perform their core income-generating work through qualified people and appropriate operating costs in Georgia.
- two years of the same permitted activity
- applicant, non-resident enterprise or majority-partner history route
- core activity, qualified people and costs in Georgia
- 5% employment income tax for Georgian and foreign employees
- 5% profit, 0% dividend and qualifying property treatment
What the company or status is designed to do
International Company Status is available to a Georgian enterprise that carries out permitted IT activity in Georgia, proves the required two-year activity history through an accepted route and maintains a real Georgian operation. Current headline treatment includes 5% profit tax, 5% tax on employment income regardless of employee citizenship, 0% dividend tax and a qualifying property-tax exemption other than land.
The two-year test is about the permitted activity, not registration age. Economic substance is also not a fixed employee quota: the company must show core income-generating work in Georgia, qualified people and appropriate operating costs.
Two years of relevant activity — not simply a two-year-old company
The required history must relate to the permitted activity for which the Georgian enterprise seeks International Company Status. Registration age alone does not prove that the business has actually carried out that activity.
- Route 1: the Georgian applicant itself has at least two years of experience in the permitted activity.
- Route 2: the Georgian applicant represents a non-resident enterprise that has at least two years of experience in the same permitted activity.
- Route 3: a partner enterprise holding more than 50% of the Georgian applicant has at least two years of experience in that permitted activity.
- Whichever route is used, the Georgian applicant must carry out the relevant permitted activity in Georgia.
- A newly incorporated standalone company without its own history or a qualifying non-resident or majority-partner route cannot satisfy the test merely with a recent registry extract.
What the evidence should show
Resolution No. 619 requires information and documents confirming that the relevant activity was carried out. It does not prescribe one closed evidence list, and the Revenue Service may request additional information. We therefore prepare a dated record that connects the legal entity, the service, the customers and the delivery of the work.
- Company extracts, constitutional documents and an ownership chart showing the applicant and any non-resident or majority partner whose history is relied on.
- Customer contracts, statements of work, invoices, payment records and acceptance or delivery evidence covering at least two years.
- Financial statements, tax returns or accounting records that support the activity and its continuity.
- Project, product, technical, IP and personnel records that show what was actually delivered and by whom.
- Apostille or legalisation and Georgian translation planning for foreign corporate and activity records where required.
The law uses a real-activity test, not a universal headcount number
The applicant must perform the permitted activity in Georgia. Resolution No. 619 says the core income-generating activities must take place in Georgia, supported by adequate human resources with the necessary qualifications and appropriate operating costs.
- There is no universal minimum employee number or fixed annual-spend threshold in this International Company substance test.
- The people, skills and Georgian costs should be credible for the scale and type of service being supplied.
- Employment or service agreements, payroll, work records, premises, equipment, software and local operating expenses may all help show the real Georgian function.
- A registered address on its own does not prove that the core income-generating activity is carried out in Georgia.
- The same substance conditions continue after status is granted and can be reviewed if the business model changes.
The current 5% salary rate does not change with citizenship
Article 23(7) of the Tax Code taxes income earned from employment at an International Company at 5%. The rule is not limited to Georgian citizens, so a Georgian employee and a foreign employee use the same 5% income-tax rate when the payment is genuine employment income from the status holder and the prescribed employee reporting is completed.
- Employee citizenship does not change the 5% employment-income rate under Article 23.
- A contractor invoice is not salary and must be analysed under the rules for that contractor or service arrangement.
- The company must keep employee, role, payroll and permitted-activity records and follow the employee-reporting procedure.
- Work permission and residence for a foreign employee remain separate from the tax rate.
- Funded-pension and other payroll obligations must be checked separately for the individual employee.
The rates are valuable, but the status must remain supportable
The current framework provides 5% profit tax on the International Company basis, 5% tax on employment income, 0% dividend tax and a property-tax exemption for qualifying property other than land. These benefits do not turn every transaction into qualifying International Company income.
- Keep each service within the permitted-activity list and connect revenue, personnel and costs to that activity.
- Other revenue is tolerated only within the statutory limit: during a calendar year it must not exceed 2% of revenue from permitted activity, excluding VAT.
- Review a new product, consulting line, reseller arrangement or local-market service before contracting and invoicing.
- Monitor ownership and any history route relied on, as well as Georgian people, functions and costs.
- The status is granted without a fixed end date, but in some non-compliance cases revocation applies from the original grant date and earlier tax periods may need correction.
What to send us first
Start with the business history and the planned Georgian operation. You do not need to draft the application or a legal memorandum: send the records you already have and we will identify the viable history route, missing evidence and translation needs.
Send us first
- Georgian applicant’s company ID and current registry extract
- Ownership chart and corporate records for any non-resident or majority partner whose history may be used
- Plain-language description of each IT service the Georgian company will supply
- Contracts, invoices, payments and financial or tax records covering the relevant two-year period
- Current and planned Georgian team roles, payroll or service arrangements and qualifications
- Georgian premises, equipment, software and approximate operating-cost information
We prepare or coordinate
- Confirm the permitted activity and the available two-year route
- Prepare the dated activity-evidence and corporate-link file
- Assess Georgian core functions, qualified people and operating costs
- Model 5% profit and employee tax, dividends, property, VAT and the Georgian-citizen salary-expense distinction
- Prepare the Revenue Service application and manage clarification or additional-document requests
Obtained or confirmed later
- Apostilled or legalised foreign corporate records where required
- Certified Georgian translations
- Updated contracts, payroll and operating records as the Georgian activity begins
- Revenue Service, Ministry and Government decision records
- Ongoing status, activity, employee and substance evidence after approval
How the work usually proceeds
The exact order depends on the service and your documents. We confirm the steps and responsibilities before professional work begins.
- 01
model the activity and transaction flow
- 02
compare ordinary and special-status treatment
- 03
register the entity and tax accounts
- 04
prepare the status application and supporting file where applicable
- 05
maintain activity, substance, allocation and reporting evidence
How this may look in a real case
A newly formed Georgian subsidiary of an established software company may rely on the qualifying majority partner’s two-year history, but it must still carry out the permitted service and build the required people, functions and operating costs in Georgia.
What can slow the process down
We check these points at the beginning and flag gaps before filing, so you can correct them while there is still time.
- The file proves that a company existed for two years but not that it carried out the same permitted activity.
- The applicant relies on a foreign or group company’s history without clearly proving the representative or more-than-50% ownership route.
- Contracts and invoices describe eligible IT services, but the people, delivery records and Georgian operating costs do not show where the core work is done.
- A contractor payment, dividend or group recharge is treated as 5% employee salary without checking the real legal relationship.
- A new or non-permitted revenue stream is invoiced before the 2% tolerance and status-retention effect are reviewed.
A clear recommendation and a managed Georgian process
We identify the correct two-year history route, test the service against the permitted list, organise the evidence and assess whether the planned Georgian people, functions and costs support a realistic application.
ITResidency.ge is operated by ASSIO LEX & ASSOCIATES LLC, the Georgian legal and business-services provider for the engagement.
- Permitted-activity and history-route review
- Corporate-link and two-year evidence file
- Georgian substance and employee-tax analysis
- Revenue Service application and follow-up
- Post-approval activity and compliance calendar
Frequently asked questions
What is International Company Status in Georgia?
It is a Georgian tax status for an enterprise that carries out permitted activities in Georgia, proves the required operating history through one of the routes in Government Resolution No. 619 and maintains the required Georgian operation. Current headline treatment includes 5% profit tax, 5% tax on employment income, 0% dividend tax and a property-tax exemption for qualifying property other than land.
Does the company need two years of history?
Yes. The required two years must be experience in the same permitted activity on which the application is based. A company that has existed for two years but cannot prove the relevant activity does not satisfy the test merely because of its incorporation date.
Whose two-year history can be used?
Resolution No. 619 provides three routes: the Georgian applicant’s own two-year history; the history of a non-resident enterprise represented by the Georgian applicant; or the history of a partner enterprise holding more than 50% of the Georgian applicant. In the second and third routes, the established business must have at least two years in the same permitted activity that the Georgian applicant carries out.
Can a newly incorporated Georgian company qualify?
Potentially, but not from incorporation alone. A new Georgian enterprise may have a route where it represents a qualifying non-resident enterprise or has a qualifying majority corporate partner with the required activity history. A new standalone company without one of those routes will normally need to build its own two-year record before applying.
What documents can prove the two-year activity history?
The resolution requires information and documents confirming the relevant activity but does not set one closed list. A practical file may include company and ownership records, contracts and statements of work, invoices and payments, financial or tax records, customer acceptance evidence, product or project records, and personnel evidence. The Revenue Service may ask for additional information.
Is a company extract enough to prove the two-year history?
No. A company extract proves registration and certain corporate facts. It does not prove that the company actually performed a permitted IT activity for two years. The application should connect the entity to real contracts, delivery, revenue and supporting business records for the required period.
What economic substance is required in Georgia?
The company must carry out the permitted activity in Georgia, perform its core income-generating activities here, have adequate human resources with the necessary qualifications and incur appropriate operating costs. The evidence should be credible for the nature and scale of the Georgian operation.
Is there a fixed minimum number of employees or minimum Georgian spend?
Resolution No. 619 does not state one universal minimum headcount or fixed annual-spend amount for this substance test. It uses a qualitative standard: core income-generating activity in Georgia, adequate qualified people and appropriate operating costs. A registered address without the people and functions needed to deliver the service is not enough by itself.
Which IT activities are permitted for an International Company?
The list includes specified software publishing, computer programming and consultancy, computer facilities management and related IT services, digital-product delivery, website development and delivery, web hosting, remote maintenance, remote systems administration and several listed online software and data services. The actual contract and service must be mapped to the current statutory list before applying.
How is a Georgian employee of an International Company taxed?
Income earned from employment at an International Company is taxed at 5% under Article 23(7) of the Tax Code. The company must complete the prescribed employee reporting and payroll treatment. Funded-pension and other employment obligations are separate from the income-tax rate.
How is a foreign employee of an International Company taxed?
The same Article 23(7) rate applies: employment income from the International Company is taxed at 5%. The current provision does not set a different rate by citizenship. The foreign employee’s Georgian work permission, residence, funded-pension position and any other-country tax consequences require separate review.
Does Georgian citizenship create any separate company tax benefit?
Yes, but it is a company-level distinction rather than a different employee salary rate. The ordinance lists salary expense paid to a hired Georgian citizen as an expense that may reduce the International Company’s distributed-profit amount subject to the prescribed procedure. A foreign employee can still have 5% salary tax, but that salary is not within this specific Georgian-citizen expense category.
Does every payment to a team member receive the 5% salary rate?
No. The 5% rule applies to income from working for hire at the International Company. A contractor, shareholder distribution, management fee or payment by another group company is not automatically employment income of the Georgian status holder. The real legal relationship and payer must be recorded correctly.
How long does International Company Status last?
The status is granted without a fixed end date and is effective from the beginning of the month in which it is granted. It remains dependent on the qualifying history route, permitted activities, Georgian substance and the other status conditions continuing to be satisfied.
Can the company earn income from non-permitted activity?
Only within the statutory tolerance. During a calendar year, revenue from other activity, excluding VAT, must not exceed 2% of revenue from the permitted activities. A new revenue stream should be reviewed before the company signs or invoices because exceeding the limit can endanger the status.
Does International Company Status give directors or employees residence and work rights?
No. Company tax status does not itself authorise a foreign national to work or reside in Georgia. Managers, representatives and employees need the work-right and residence analysis that applies to their actual role.
IT residence for International Company managersCan ITResidency.ge assess the history and substance before filing?
Yes. We can test the permitted activity, identify the available two-year route, review ownership and foreign-company records, build the activity-evidence chronology, assess the proposed Georgian people and costs, model employee and company tax treatment, and prepare the application and follow-up scope.
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