Georgia's 1% Small Business Regime for Digital Nomads
1% on turnover up to GEL 500K, real Georgian residency, and a bank account that actually works — here's the setup, the traps, and the two claims worth checking before you rely on them.
Last edited 12 August 2026 - Authors: Joe Martin Hanson, Director & Global Partner, with advice from FTR’s Georgian Tax Partners.
A freelancer invoicing $150K a year through Georgia's Small Business Status pays roughly $1,500 in tax. That's not a typo — it's turnover under the GEL 500K cap, taxed at 1%. Here's how it actually works, and where it stops.
The Numbers (2026)
Small Business Status (SBS) rate
Current figure: 1% on turnover up to GEL 500K (~$185K)Above GEL 500K
Current figure: 3% on turnoverTwo consecutive years over GEL 500K
Current figure: SBS revoked; standard rates applyStandard personal income tax
Current figure: 20% flatCorporate tax
Current figure: 15%, or 0% on retained earningsVAT threshold
Current figure: GEL 100KPhysical presence for tax residency
Current figure: 183 daysCurrency
Current figure: Georgian Lari (GEL); roughly 2.7 to the US dollar
How Small Business Status Actually Works
The setup, in order:
Register as an Individual Entrepreneur (IE) in Georgia.
Apply for Small Business Status — the 1% regime.
Register with the tax authority.
Open a Georgian bank account.
Invoice clients through your IE, converting to GEL as needed.
Turnover up to GEL 500K (~$185K) is taxed at 1%. That's it: no deductions to chase, no brackets to climb. Pair that with Georgian tax residency (183+ days) and you have personal and business tax residency at a genuinely low effective rate. On $150K of turnover, that's roughly GEL 4,000, or about $1,500 — not a rounding trick, just what 1% of that amount actually is.
Who Qualifies — And Two Claims Worth Checking Yourself
Small Business Status is aimed at individual freelancers and consultants. The tax authority excludes certain activities from it — financial services, some licensed professional services, investment activities, and consulting to Georgian clients (which pulls in VAT and residency complications). For a foreign consultant billing international clients, SBS typically applies cleanly.
Two things get stated with more confidence online than the underlying rules actually support, and we'd rather flag that than repeat it:
The exact scope of excluded activities. The list above is the commonly cited version, but enforcement and edge-case interpretation vary.
Whether income from foreign clients counts as Georgian-source or foreign-source. This gets reported confidently in both directions across nomad content, and it matters for how the income interacts with your home country's own tax rules, not just Georgia's.
Don't structure around either point without confirming it directly with a Georgian accountant first.
The Residency Trade-Off
To be Georgian tax resident and actually benefit from these rates, you need 183+ days in Georgia in a year. That makes Georgia your real base, not a paper one. For nomads happy to settle into Tbilisi, an increasingly popular nomad city, that's not a cost. For anyone wanting true location independence, it's a genuine constraint worth weighing against the tax savings.
Banking
Georgian banks (TBC Bank, Bank of Georgia) are accessible to residents and Individual Entrepreneurs, with setup typically taking days to weeks rather than months. Minimum balances are low, and multi-currency accounts are standard. Georgian banking has strengthened considerably since 2020 and is generally considered stable and internationally recognised.
Where This Breaks
Exceed GEL 500K and everything above that line is taxed at 3%. Exceed it for two consecutive years and SBS is revoked entirely: you fall back to standard rates. Fall short of 183 days in Georgia and you're not Georgian tax resident, which means SBS doesn't cleanly shield you from whatever your other country of residence wants to tax. And if you're from a country with CFC rules, running income through a foreign structure needs real care, not an assumption that low tax abroad settles things at home. None of this makes Georgia a place to hide money, either — it participates in international information exchange, and its banks report.
How Georgia Stacks Up
Georgia SBS
Rate: 1% (to GEL 500K)
Trade-off: Full residency, genuine 183-day presence requiredUAE Free Zone
Rate: 0% on qualifying income
Trade-off: Higher setup cost, substance requirementsPanama
Rate: 0% on foreign-source income
Trade-off: More complex residency, tightening presence rulesCyprus
Rate: Generally higher effective rate at this income bracket
Trade-off: Simpler EU access
For nomads under roughly $185K in turnover, Georgia usually wins on the combination of simplicity and rate.
Before You Register
SBS is one of the simplest low-tax setups available at this income bracket, provided you're genuinely willing to spend 183 days a year in Georgia. Send us your turnover number and we'll tell you in one email whether SBS actually clears the GEL 500K threshold for you — no call needed to start.
Important note: Treat this as a starting point, not advice. Confirm your own position with a qualified adviser before registering anything.
Next Steps
Need help with obtaining digital nomad residency or setting up a beneficial tax/finance situation? Book a scoping call.
We don’t time-bill and the initial call is free - click the ‘Book a Consultation’ button or email us at hello@ftr.finance today.
Important note: This article is general information for readers considering cross-border retirement or asset structuring. It is not personal tax, legal, or financial advice. Tax laws, visa rules, and treaty positions change regularly, and how they apply to you depends on your specific facts, citizenship, source of income, and prior tax history. Speak to a qualified adviser at FTR or elsewhere before acting on anything in this article.
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