Individual entrepreneur in Georgia 2026: register and pay 1%

1% of turnover and GEL 26 to register: the standard small business regimes in Armenia and Kazakhstan cost several times more. But since 2026 the relief demands discipline: a right to work from 1 March, returns even for empty months and a list of professions barred from 1%. Registration in person and remotely, banks and Russian taxes.

The state fee to register as an individual entrepreneur (IE) in Georgia is about $10, and registration takes one working day. With small business status the tax is 1% of turnover, as long as gross income for the calendar year stays within GEL 500,000 (about $200,000). For comparison, the base simplified-tax rate for a sole trader in Russia is 6% of income, six times as much.

A 1% income tax looks like a typo, but it is Article 90 of the Tax Code of Georgia, and nobody touched the rate in 2026. What did change is everything around it. On 1 February 2025 the relief was closed to construction services for businesses. Since 1 March 2026 a foreigner without permanent residence needs a separate right to work for activity in Georgia. And since spring 2026 a missed nil return counts as a breach rather than a polite silence.

Below: how a Russian citizen opens an IE in Georgia in person or remotely, what it costs in state fees, who cannot get the 1% even with perfect paperwork, what changed in 2025-2026 and where the tax is really due. For the wider country picture with residence permits, property and living costs, see our article Georgia in 2026: residency, the 1% tax and the new rules. This one is about the IE only.

Caps, thresholds and fines below are in Georgian lari (GEL); state fees are converted to US dollars and rounded up. At the National Bank of Georgia rate, $1 is about GEL 2.6.

How to register an individual entrepreneur in Georgia: routes, timing and fees

Business registration is run by the National Agency of Public Registry (NAPR) under the Ministry of Justice. Applications go through Public Service Halls, large one-stop government offices where the same building renews passports, registers flats and registers businesses. Neither citizenship nor a residence permit is required to register an IE. A passport is enough.

The fees come from NAPR's official 2026 schedule. The comparison with an LLC is fair both ways: an IE is almost eight times cheaper to set up and far simpler to report, while an LLC has no turnover cap and does not tax the owner as long as profit stays in the company.

How a Russian citizen opens an IE in Georgia, step by step

Registration itself is the shortest part. The bank and the first return usually take longer.

1. Check the activity. Before filing, match the work against the list of activities barred from small business status (see below). To the tax office, a marketing consultant and a marketer who executes campaigns are two different people, and the gap between them is worth 19 percentage points.
2. Find a legal address. An IE is registered at an address in Georgia. A rented flat works if the owner gives written consent to use it as the business address. Official letters go there, so the address of a friend who moves out next month is a bad idea.
3. File at the Public Service Hall. In person or through a representative with a power of attorney. Once registered, the IE gets an identification number. There is no separate tax registration: under Article 66 of the Tax Code the tax authority does not register persons registered by NAPR, and the registry number doubles as the tax number.
4. Get access to rs.ge. This is the portal of the Revenue Service, Georgia's tax authority. Applications, returns and payments all go through it.
5. Apply for small business status. The tax authority issues a certificate (Article 89 of the Code). Since March 2026 the status applies from the day of the application, so it makes sense to file right after registering the IE and before the first client payment.
6. Sort out the right to work. If the work is done in Georgia for local clients, a right to work has been required since 1 March 2026. If the clients are abroad and the work relates to their business outside Georgia, the law makes an exception. Details below.
7. Open an IE bank account. In practice the least predictable step, also covered below.
8. File a return every month. By the 15th of the following month, even when income was zero.

Can you open an IE in Georgia remotely, and what does it cost

Yes: the law does not require the owner to appear at the Public Service Hall. A representative files under a power of attorney, and the only mandatory payment to the Georgian state is the same NAPR fee, about $10 for one-working-day registration. Everything else in the price of a remote setup is the notary, apostille, translation and the representative's work, not Georgian charges.

Georgia accepts documents issued abroad once they are certified in the prescribed way, unless an international treaty waives this. For a Russian power of attorney that usually means an apostille and a notarised Georgian translation. A Latin spelling of the surname that does not match the passport sends the whole package back for a second round, which is the most annoying way to lose two weeks.

What is hard to do remotely is the bank. Not every bank will open an account under a power of attorney, and many want to see the client in person the first time. The typical scenario is therefore: the IE and the status are arranged from Russia, and the account needs a short trip.

Now the taxes a remote IE does not make disappear. The 1% applies only to Georgian-source income (Article 90 of the Tax Code). For someone living in Georgia that covers almost any service income, including foreign clients: Article 104 treats services a Georgian resident provides to a client in another country as Georgian-source. For someone living in Russia the picture flips: services rendered from Russia by a non-resident of Georgia are not Georgian-source under the letter of the same article, while the Russian tax office sees the full income of its resident.

Worked example. A Russian tax resident with a Georgian IE earns 3 million rubles a year. Russian personal income tax on the 2026 scale comes to 402,000 rubles: 13% on the first 2.4 million and 15% on the rest. If 1% has been paid in Georgia anyway, it cannot be credited in Russia, because there is no double tax treaty in force between the two countries. So a Georgian IE without moving is not a way to pay 1% instead of 13%. It is a way to pay both.

A non-resident of Georgia can still register an IE and obtain small business status: Article 88 speaks of an entrepreneur natural person and requires neither tax residence nor a residence permit. How to pick a country for a business without relocating is covered in our article on registering a company remotely.

Georgia's 1% tax: how small business status works

Small business status is available only to an entrepreneur natural person, which means a registered IE (Article 88 of the Code). The tax is levied on turnover, not profit: a laptop, a coworking desk and advertising do not reduce the base. On the bright side, nobody asks for proof of them either.

• Cap. 1% applies while gross income for the calendar year does not exceed GEL 500,000 (about $200,000). For wine tourism and agritourism the cap is GEL 700,000 (about $270,000).
• Going over. From the month in which income crosses the cap until the end of the year, the rate is 3% (Article 90).
• Losing the status. If the cap is exceeded in two consecutive calendar years, the status is revoked from the start of the following year (Article 89).
• Salary does not count. Only business income qualifies for 1%. If the IE owner also has a job, including with a foreign company, the salary is taxed under the general rules.
• No loss carry-forward. Article 91 expressly bars carrying a small business loss into the next year.

Worked example. A designer living in Tbilisi earns GEL 120,000 a year (about $46,000) from foreign clients. Tax with small business status is GEL 1,200 (about $460). The same income for an IE without the status is taxed at 20% of profit: with GEL 10,000 of expenses the tax is GEL 22,000. That is more than 18 times as much, which makes half an hour on the application a very good investment.

If micro business income passes GEL 30,000, the owner has 15 days to request small business status. On time, income before the switch stays untaxed. Late, and since March 2026 everything earned from the start of the year until the status is granted is taxed at the general 20%. The full set of rates, including dividends and property tax, is on our page taxes in Georgia.

Who cannot get the 1%: barred activities

The list sits not in the Code but in Government of Georgia Resolution No. 415 of 29 December 2010 on special tax regimes. Under its Annex 4, small business status is not available to an IE engaged in:

• activities that require a licence or permit;
• production of excisable goods;
• currency exchange operations;
• medical, architectural, advocacy, notarial, audit and consulting activities, including tax consultants;
• gambling;
• staffing, that is, providing personnel to other businesses.

The trickiest item is consulting. The resolution does not say where website development ends and digital strategy advice begins, and the tax office reads contracts more carefully than many clients do. Wording in contracts and invoices therefore matters, and Murblz specialists check it before registration rather than after a letter from the tax office.

Construction left the 1% regime on 1 February 2025, though through the list of excluded income rather than the list of barred activities. Resolution No. 436 of 23 December 2024 added to Annex 5 income from building construction, civil engineering and specialised construction work when the client is a company, an organisation or another IE. That income is taxed under the general rules at 20% and does not count towards the GEL 500,000 cap. Renovating a flat for a private person stays at 1%.

The same Annex 5 lists other income that bypasses the relief even for an IE with the status: renting out property, interest on loans, dividends, royalties, gains on selling real estate, cars, securities and shares, winnings, gifts, inheritance and debt forgiveness. Letting a flat in Batumi through the same IE at 1% will not work.

Getting it wrong is expensive. If the tax office finds a barred activity, the status is revoked retroactively from the start of the calendar year (Article 89), a fine of about $195 is imposed (Article 288) and tax is recalculated at the general rates. Since March 2026 the status can be requested again only from the next tax year.

IE reporting in Georgia: returns, deadlines and penalties

Bookkeeping for a 1% IE is simpler than for any Russian sole trader, but it takes more discipline than it seems.

• Monthly return. Filed and paid no later than the 15th of the following month (Article 93 of the Code). There is no annual return for income under the status.
• Nil months count too. Since March 2026, Minister of Finance Order No. 38 states that a small business return that has not been filed is not treated as a nil return. Previously, under Article 67 of the Code, an unfiled return was deemed to be a nil one. For small businesses that rule no longer applies, so empty months must be declared as well.
• Record book. Article 91 requires a special book of income and expenses (an electronic one is allowed) and keeping source documents: invoices, contracts, statements.
• Cash register. If the IE sells goods or services for cash, the cash register rules apply. Three fines for breaching them within a year, and the status is revoked from the start of the year.
• Income before the status. If the status is granted mid-year, an annual return for the period from 1 January until the status date is due by 1 April of the following year.
• VAT. Small business status does not exempt from VAT. Once VAT-taxable transactions in any 12 consecutive months exceed GEL 100,000 (about $39,000), the IE must register as a VAT payer within two working days; the rate is 18% (Articles 165 and 166). Services to foreign companies are usually taxed in the client's country under the VAT place-of-supply rules, while sales to local clients count towards the threshold.

A bonus for anyone hiring help: in the year the IE is registered and granted the status, and whenever the previous year's income was no more than GEL 50,000, wages to employees of up to GEL 6,000 a year in total are not taxed at source (Article 94).

IE in Georgia from 1 March 2026: do you need a right to work

Since 1 March 2026 the Law of Georgia on Labour Migration requires a right to work from foreigners without permanent residence, and not only from employees. The law expressly defines a self-employed alien as someone who trades, provides services, works as an independent contractor or otherwise carries on business for financial gain. A registered IE fits that definition.

The key exception for freelancers is in Article 1(4) of the law: it does not apply to someone who provides services to a non-resident where those services relate to the non-resident's activity outside Georgia. A designer in Tbilisi building interfaces for a German start-up falls under the exception. The same designer with an order from a Tbilisi coffee shop does not.

• How to apply. A self-employed foreigner applies personally through the Ministry of Labour, Health and Social Affairs portal labourmigration.moh.gov.ge and attends a mandatory video interview.
• Cost. about $80 for a decision within 30 calendar days, or about $160 within 10 working days.
• Fine. Working without a right to work costs a self-employed person $770, and a repeat offence costs twice as much. Changing activity without renewing the right is another $770.
• Link to residence. The law ties the right to work to a basis of stay: labour immigrants with an active registration on 1 March 2026 must obtain both the right to work and the matching residence permit by 1 January 2027.

Among others, holders of an investment residence permit are outside the law. The rest of the migration changes, including the mandatory insurance on entry, are in our article on Georgia's migration rules, and the remote-worker option is on the page Georgia digital nomad visa.

An IE bank account in Georgia: TBC, Bank of Georgia and what Russians are asked for

An IE in Georgia can be registered in a day; an account for it depends on how compliance goes. The country's largest banks, TBC Bank and Bank of Georgia, work with foreigners, Russians included, but check them more closely than others. The reason is mundane: Georgian banks depend on correspondent banks in the US and Europe and will not risk those relationships for one client.

Banks are supervised by the National Bank of Georgia, and anti-money-laundering rules oblige a bank to establish who the client is, what they do and where the money comes from. That is KYC (know your customer). For an IE account banks usually ask for:

• a passport and the IE registration extract;
• a Georgian phone number;
• a client questionnaire describing the business and expected turnover;
• proof of the source of funds: 6-12 months of bank statements, client contracts, tax returns or income certificates;
• sometimes a Georgian lease and the small business certificate.

Compliance here is like a polite but very thorough examiner: the exam questions are known in advance, the follow-ups are improvised. Banks change their internal rules without public notice and may refuse without giving reasons, so it pays to file a complete package the first time, with English translations. Georgian banks comply with international sanctions and stop payments that look like circumvention, which matters if some clients are in Russia.

How to document the source of funds so that it is accepted first time is covered in our article on proving the source of funds. Support with accounts is on the pages business account in Georgia and personal account in Georgia.

Tax residence: where a Georgian IE actually pays tax

A person becomes a Georgian tax resident after spending 183 days or more in the country in any continuous 12-month period ending in the current tax year (Article 34 of the Tax Code). Days abroad for medical treatment, holiday, business trips or study count as days in Georgia. The Revenue Service issues a tax residence certificate through rs.ge, and banks and clients ask for it.

Russia counts days its own way: a person stays a Russian resident after 183 days or more in Russia within 12 consecutive months (Article 207 of the Russian Tax Code). As long as the owner of a Georgian IE is a Russian resident, all income is subject to Russian personal income tax on a scale from 13% to 22%, and Georgian tax cannot be credited because there is no treaty in force. Once Russian residence ends, the Georgian IE's income is not taxed in Russia. How this rule works across countries is explained in our guide to tax residence and the 183-day rule.

A word on bank balances. Since 2024 Georgia has taken part in the automatic exchange of financial account information under the OECD Common Reporting Standard (CRS). Whatever happens to that data, a Russian currency resident must notify the Federal Tax Service of an account opened abroad within a month and file a report on account movements for the previous year by 1 June (Federal Law No. 173-FZ on currency regulation). The law has exceptions for people living abroad, but they are worth checking against one's own dates.

An IE is not a company, so controlled foreign company (CFC) rules do not apply to it. If a Georgian LLC is registered instead, a Russian tax resident must notify the Federal Tax Service of the participation and the CFC; see the page CFC filings.

What changed for IEs in Georgia in 2025-2026

The 1% rate, the GEL 500,000 cap and the GEL 100,000 VAT threshold stayed the same over these two years. Everything around them moved.

IE in Georgia, Armenia or Kazakhstan: which pays off in 2026

No calculator needed: one table shows the difference. Georgia wins on the rate and the easy entry, Armenia on 1% for IT activities on the government list, Kazakhstan on a huge cap, but only after a residence permit.

Dollar conversions use the National Bank of Georgia rate in 2026. More on the neighbours' taxes on the pages taxes in Armenia and taxes in Kazakhstan, and on life and banking in the articles Armenia in 2026: residency, banks and taxes and moving to Kazakhstan in 2026.

Pitfalls: where people lose the status and money

• One barred service spoils everything. The status is revoked for carrying on a barred activity at all, not just for the income from it, and from the start of the year.
• The word consulting in a contract. To the tax office it is not a style choice but a type of activity.
• Living in Russia with a Georgian IE. Russian income tax does not go away, and Georgian tax cannot be credited.
• Local clients without a right to work. Since 1 March 2026 that means a fine of about $770, about $1,600 the second time.
• A skipped nil return. Since 2026 it is a breach, not silence.
• The VAT threshold. GEL 100,000 of VAT-taxable transactions in any 12 months, mostly sales to local clients, and 1% is no longer the only tax.
• Two years over the cap. Then the status goes, and it is time to think about an LLC.
• Someone else's address. Tax office letters arrive at the legal address, and not reading them is no excuse either.

Who a Georgian IE does not suit: people who keep living in Russia for more than 183 days a year and hope to pay 1% instead of Russian income tax; consultants, doctors, architects, advocates and notaries; builders working for companies; businesses with turnover well above GEL 500,000. For them it is more honest to look at an LLC or another country straight away; jurisdictions are compared on the page company formation abroad.

What we do

Murblz specialists take a Georgian IE from the activity check to the first return and the bank account. We quote a fee after reviewing the documents.

If Georgia does not fit the activity or turnover, we look at registration in Armenia and in Kazakhstan.

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