How does Georgia's 1% small business tax status work?

Checked on 2026-10-25

An individual entrepreneur in Georgia can apply to the tax authority for small business status. Taxable income is then taxed at 1%, or 3% from the month gross income passes GEL 500 000 in a calendar year. It covers Georgian-source income except salary. You file and pay monthly, by the 15th of the next month.

Key facts

What	The law says	Source
Who can get it	An entrepreneur natural person (individual entrepreneur)	Tax Code, art. 88(1)
How	Apply to the tax authority, which grants a small business certificate	Tax Code, art. 89(1)
Rate	1% of taxable income	Tax Code, art. 90(1)
Above the limit	3% from the month gross income from economic activities passes GEL 500 000 (GEL 700 000 for wine and agro tourism operators), until the end of that calendar year	Tax Code, art. 90(2)
What’s taxed	Georgian-source income, except salary income and income types the Government excludes	Tax Code, art. 90(3)
Return and payment	By the 15th day of the month after the accounting month	Tax Code, art. 93(1¹)
Records	A special book of records; keep tax source documents issued to or by you	Tax Code, art. 91(1) and (3)
Losses	Not carried forward to the next year while you stay in the regime	Tax Code, art. 91(5)
Excluded activities	The Government, with the parliamentary Financial-Budget Committee, may bar activities from the status	Tax Code, art. 88(2)

How the tax is worked out

With small business status, your taxable income is taxed at 1% (art. 90(1)). If your gross income from economic activities in a calendar year passes GEL 500 000, the rate becomes 3% from the start of the month in which that happens, until the end of the year. For wine tourism and agro tourism operators the limit is GEL 700 000 (art. 90(2)).

The taxable income is income from a Georgian source, except salary and any income types the Government excludes under Article 88(3) (art. 90(3)).

When you lose the status

Article 89(2) lists the grounds for revoking the status:

gross income from economic activities above GEL 500 000 (GEL 700 000 for wine and agro tourism operators) in each of 2 calendar years – revoked from the start of the following year (art. 89(3));
you ask the tax authority before the end of the calendar year – revoked from the first day of the next month (art. 89(3¹));
you carry on an activity barred under Article 88(2), or you are fined at least three times in a calendar year for breaking the cash register rules – revoked from the start of the calendar year (art. 89(4));
you are no longer an entrepreneur natural person – revoked from the date that happened (art. 89(5)).

Filing

A small business files its tax return and pays the tax by the 15th day of the month after each accounting month (art. 93(1¹)). The filing procedure is set by order of the Minister of Finance (art. 93(4)).

VAT: a small business that has to register for VAT does so under Article 165 (art. 92(1)). Registration is required within 2 business days after taxable transactions pass GEL 100 000 in any 12 consecutive calendar months (art. 165(1)).
Micro business: a separate status for individuals without hired staff whose gross income in a calendar year doesn’t exceed GEL 30 000 (Tax Code, arts. 84–86).

Sources

Tax Code of Georgia, No 3591 of 17 September 2010, arts. 83, 88–93 (consolidated English text, Legislative Herald of Georgia, matsne.gov.ge) checked 2026-10-25

Change history

2026-10-25: Page created

This is general information, not legal advice, and Lumen is not a law firm. Rules change and offices differ: check the official sources above before you act. Found something wrong or out of date? Write to support@lumen.observer.