Georgia Territorial Tax System

Georgia's personal tax system is frequently described as territorial in effect, because resident individuals can be exempt from tax on income that does not have a Georgian source.

The baseline rate for Georgian-source personal income is 20%. Capital gains are generally taxed at 20%, with certain transactions taxed at 5%. Dividends sourced to Georgia are typically taxed at 5%.

The key exemption is the treatment of non-Georgian source income: where income is not considered Georgian-source, it can be outside Georgian income tax even for a tax resident. This is the core feature that attracts internationally mobile profiles.

To use the regime in practice, the hard part is classification. Where services are performed, where management decisions are taken, and the taxpayer's residence and treaty position can all affect whether income is Georgian-source. Treat it as a rules-based system, not a blanket exemption, and verify sourcing for the specific fact pattern.