Work and IEFor individual entrepreneurs (IE) and the self-employed

IE small business status in Georgia: 1% tax, monthly returns

Small business status means 1% tax on turnover up to 500,000 ₾ a year and a return every month. From 1 March 2026, IEs usually also need a work permit.

Checked by the editors on 29 September 202620 sources8 minutes

In short

Tax: 1% of turnover up to 500,000 ₾ a year. From the month you go over the limit to the end of the year: 3%
When the status is removed: After two consecutive years above the limit, from 1 January of the following year
Who is not eligible: Licensed activities or those needing a permit, production of excise goods, currency exchange, gambling, provision of staff, and medical, architectural, advocacy, notarial, audit and consulting services
Tax return: Every month by the 15th, even a nil return
VAT: If turnover over any 12 consecutive months exceeds 100,000 ₾. B2B services to non-residents do not count
Work permit: Required from 1 March 2026, unless an exemption applies. From 10 July, you need a certificate of turnover of at least 50,000 ₾ over 12 months

What to do

Check your type of activity
The status is not available for licensed activities or those needing a permit, production of excise goods, currency exchange, gambling or provision of staff. It is also not available for medical, architectural, advocacy, notarial, audit or consulting services.
Check whether you need a work permit
The self-employed, including IEs, need one from 1 March 2026. To apply, you need a certificate of turnover of at least 50,000 ₾ over 12 months if your IE is more than 3 months old. Exemptions and grey areas are below.
File a return every month
File by the 15th of the following month, even if you had no turnover.
Keep track of your turnover
If your turnover for the year goes over 500,000 ₾, the rate is 3% from that month to the end of the year. After two consecutive years above the limit, the status is removed. If turnover over any 12 consecutive months exceeds 100,000 ₾, register for VAT within 2 working days.

Grey areas: lawyers disagree here

IE with all clients abroad

From 10 July 2026, Resolution No. 70 states that the exemption for work for a non-resident does not apply to an IE who needs a residence permit to stay in Georgia legally. The law has no such condition. It is not yet clear how this is applied. Ask a lawyer.

IE older than 3 months but less than a year old

The text of the resolution requires turnover over 12 months, even if the IE has been operating for less than a year. Practising lawyers report case-by-case clarifications from the agency. Check this rule as of the date you apply.

FAQ · 7

Does an IE need a work permit?

Yes, from 1 March 2026, unless an exemption applies. If all your clients are abroad and you do not need a residence permit, Resolution No. 70 does not require a work permit. If you need a residence permit, it does. This is a grey area: ask a lawyer.

Do I need a business plan for the permit?

No. It was removed from the requirements with effect from 10 July 2026. Instead, you need a Revenue Service certificate of turnover of at least 50,000 ₾ over 12 months. If your IE was registered no more than 3 months ago, you do not need the certificate.

Do I need 50,000 ₾ turnover for a residence permit through an IE?

Yes. The requirement was removed from the law in April 2026, but it is still in Resolution No. 520 on residence permits. You also need a monthly income of at least five times the subsistence minimum. An IE under 3 months old does not need the certificate, but the first residence permit will be issued for 6 months.

How is the 3% calculated?

Income from the start of the month in which your turnover for the year went over 500,000 ₾ until the end of the year is taxed at 3%. Income before that month is still taxed at 1%.

What if I had no turnover?

You still file a return every month, with zero turnover.

Do services to foreign companies count towards VAT?

No, if they are B2B services to non-residents. They are not subject to VAT in Georgia and do not count towards the 100,000 ₾ threshold.

Can an IE work as a courier or taxi driver?

If you need a work permit, in practice no: the annual work permit quota for couriers, taxi drivers and other passenger transport, and for guides is 0 (Annex 3 to Resolution No. 70).

What changed · 5

26 June 2025Law No. 862 amended the Labour Migration Law: foreigners need a work permit from 1 March 2026
1 March 2026The self-employed, including IEs, need a work permit
15 April 2026Law No. 1509: exemption for work for a non-resident; partners removed from the definition of "self-employed"
1 May 2026Checks began on the self-employed who were working before 1 March 2026
9 July 2026Resolution No. 321, in force from 10 July: an IE applying for a permit needs a turnover certificate of 50,000 ₾ instead of a business plan. Resolution No. 317 refined the same threshold for work residence permits: a company or IE under 3 months old with no more than 3 foreign workers does not need the certificate. The threshold for work residence permits has applied since 2019; since 15 April 2026 it is no longer in the law (Law No. 1510) but remains in Resolution No. 520

Sources · 20

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