If you deliver your service outside of Georgia your activities are VAT free. However, yes, you still need to pay corporate income tax on the profit generated with your Georgian Company. Some people think that as Georgia has territorial taxation system, if you start your business in Georgia and generate income from outside Georgia you are tax free. But that’s not a case. Simply explained, territorial taxation system does apply yo Individuals Employed Outside of Georgia. Keep in mind that there are several legal forms that you can chose for starting company and requirements for them are different in terms of taxation. Also, there are some special regimes within the legal forms too. For LLC such as Virtual Zone for IT Companies or Micro and Small Business Status for Individual Entrepreneurs.
Unfortunately, to have your Bank Cards you need to travel to Georgia. Right now Banks only allow to distribute cards in Person. Remote Services for Opening Bank account with Bank Cards are not available at the moment. What we can do is to open bank account for you and assign personal banker with whom you can easily communicate any time and who will help you to manage your account. You will have to come to activate internet banking and request Bank Cards Though.
Yey! If you deliver your service outside of Georgia your activities are VAT free.
If you let us know in advance and we have enough time to prepare all the supporting documentations we simply need 2 working days to finalize company formation procedure. After that, you will need 2 working days to finalize bank account opening with banks. In total, company formation will take half an hour of our time, you need to sign some documents in Public Service Hall and That’s It and for Bank Account you need 2 hours approximately to sit and wait until bank officer finalizes the procedure. It’s as simple as this with our assistance.
In Georgia there is no such kind of restrictions. I can 100% assure you that Georgia is open for any Country Citizen in terms of Registering a Company. Even more, It is as easy to register company in Georgia for foreigners as It is for Georgians.
Honestly Speaking, nobody can assure you with this and give you 100% warranty on successful opening. There are special department in Banks who makes this decision of opening bank accounts. They treat each and every client individually. They study and evaluate upon their scope of knowledge. Therefore, there is no clear and exact guidelines, checklist of documents where we can say – If you comply with this you will be able to open personal bank account remotely. If we speak of our experience, sometimes we did indeed succeed and successfully opened bank accounts with full package services such as internet banking and bank cards. However, mainly we are able to open bank accounts with restrictions on internet banking and bank cards. To gain access on internet banking and request bank cards you need to travel in Georgia and do It in Person. If you are willing to pay a visit to Georgia, It is pretty simple to open bank account here. All you need is your passport and one hour of your time. What we can safely offer at this point is to open bank account and assign personal banker to you, with whom you can easily communicate and who will help you to manage your account as well as undertake necessary transactions.
Only Legal Requirements you have after forming your Georgian LLC or any other type of legal entity is to meet taxation requirements. You are legally required to keep bookkeeping and doing declarations for tax authorities monthly basis. For more details on our accounting service offer in Georgia refer to go here. For more details on requirements after company establishment you can see my video.
If you establish individual Entrepreneurship in Georgia, you are eligible to apply for small business status. With Small Business Status you will have to pay only 1 percent income tax with tax base of Gross Revenue. However, there are some major points to be considered. Individual Entrepreneurship is not Limited Company. The company ID is assigned to your personal name. So there is not possibility to pick a name for your company. One more major drawback is that your capital is not limited to company capital. In other words, if you start Individual Entrepreneurship and you have liabilities for your company your liabilities are not limited to company capital but your personal capital will be also considered. If you are planning to have legitimate business, Individual Entrepreneurship can be a good match for you. Majority of the people in Georgia use this scheme as well as some of my clients.
Find below major aspects of forming Limited Liability Company or Individual Entrepreneurship in Georgia. I tried to put it in simplest way possible. For more details on starting a business in Georgia and Choosing the right legal form for it, please refer to this blogpost, I also made a case study for you there.
Aspect of Difference
Up to Six, possible to change and modify
Only one, no possibility of modification
Corporate Profit Tax 20% with tax base of net revenue with no Special Regime.
Corporate Profit Tax with small business status 1% of gross revenue.
Limited to Company Assets
Liable with Individual Assets
Accounting and Taxation Obligation
VAT TAX Obligation
No VAT on Services Delivered Outside of Georgia.
No VAT on Services Delivered Outside of Georgia.
Of your Choice
Company Assigned to your personal name
Yes, you can open company and bank account for your company remotely without your prior visit to Georgia. Steps for the procedure is as follows:
1.We will Prepare POA for you
2. You need to apostille or legalize this POA TOGETHER WITH PASSPORT.
3. Send originals to our address.
The rest we can take care of. One note, unfortunately, banks do not have real clear procedure and guidelines for opening bank account. Each case is evalauted individually and reasons and ground of decision is not public. Mainly, we don’t face any problems with opening bank account remotely for a Georgian company. However, based on our experience, banks several times required that Company ID needs to be mentioned in the POA, which is impossible to do in advance, before company is formed. So, in worst scenario you will have to send separate POA for banks after company formation.
Once we receive POA and Passport we need:
- 2 working days – to translate and notarize the document.
- 2 working days – to apply for company establishment.
- 3 working days -to finalize setting up bank account.
It is a legally required point for company formation in Georgia to have a Georgian legal address. This is a proof from the landlord that you can use the real estate property owned by him/her for your company or It is a rent agreement between you two. You can not establish a company in Georgia without this point. So, answer is that it is mandatory to have a legal address in the process for company establishment in Georgia. With legal address base service included in our package you won’t be able to receive post emails.
If you like your post or emails to be handled properly you can use virtual office service. I advice you to use virtual office service for handling incoming post. But, you should also know that in Georgia they do not sent much. Post Service is not that much used. Having Virtual Office makes you more professional for 3rd parties, but you have to decide is it or it is not worth for you. The takeaway is that, Legal address is a must to form a company in Georgia when virtual address is not.