1% Tax Status Georgia 2026: The Best Step-by-Step Guide

Who Can Obtain It?

If you are a freelancer or a small business owner, 1% Tax Status Georgia 2026 is the best way to manage your finances.

Georgia is a great place to work because of its low tax rate. However, as of 2026, the process has changed. To get these benefits and stay legal, there is a specific path to follow.

Many freelancers choose the 1% Tax Status Georgia 2026 because it simplifies their accounting.

In this guide, we explain the new 3-step process in very simple terms. If you follow these steps, your business will be safe, and your taxes will be low.

The 2026 Update: The Work Permit

Before March 2026, don’t forget that the 1% Tax Status Georgia 2026 requires a valid work permit first. Most people just registered as an Individual Entrepreneur (IE) and started their work. Now, there is one more important step: the Work Permit Georgia 2026.

Step 1: Register as an Individual Entrepreneur (IE)

The first step to getting your 1% Tax Status Georgia 2026 is to register at the Public Service Hall.

What do you need? You only need your passport and a legal address in Georgia. If you don’t have an address, some services can help you with a legal business address.
What is it? This is your official business name. It is the simplest way to work for yourself in Georgia.
Can you do it from abroad? Yes. You can give a Power of Attorney (POA) to a professional, and they can do the registration for you.

Step 2: Get Your Work Permit Georgia 2026

This is the most important new part of the process. After you get your IE papers, the next step is to apply for the Work Permit Georgia 2026.

Why do you need it? It is a standard rule for foreigners now. It shows the government and the banks that you are working legally.
When to apply? It is a good idea to apply right after you get your IE registration.
The Benefit: Having this permit makes everything easier. It helps when you want to open a business bank account and shows that your business is fully legal.
Internal Link: If you want to see exactly which documents you need for this permit, read our guide on Work Permits here.

Step 3: How to Apply for 1% Tax Status in Georgia 2026

After your business is registered and you start the work permit process, you can get the 1% tax status. This is called Small Business Status.

The 1% Tax: You only pay 1% of the money you receive. This is for businesses that make less than 500,000 GEL per year.
Start Right Away: A great change in 2026 is that you don’t have to wait. Before, you had to wait until the next month. Now, as soon as you get the status, the 1% rate starts immediately.
How to keep it? Once you have your IE and Work Permit, you can officially activate your 1% Tax Status Georgia 2026 through the RS.GE portal.

Important: What Happens When You Earn Over 100,000 GEL?

Many entrepreneurs ask about VAT (Value Added Tax). In Georgia, if your income goes over 100,000 GEL in 12 months, you usually need to register for VAT.

However, there is a big advantage for service providers:

Export of Services: If you provide services to clients outside of Georgia (abroad), your work is usually exempt from VAT.
The Result: This means even if you earn more than 100,000 GEL, you do not have to pay the 18% VAT if your services are considered “exported.” This is a great way to grow your business while keeping your costs low.

Common Questions (FAQ)

Is it hard to get the 1% tax status? No, it is simple. You just need to follow the right order: IE -> Work Permit -> 1% Status. What if I make more than 500,000 GEL? If you earn more than this limit, your tax becomes 3% for the rest of that year.

Conclusion

Georgia is still a fantastic place for business in 2026. The new process is there to make things more professional and stable for everyone. Just remember the steps: Register your IE, get your Work Permit Georgia 2026, and then start your 1% status.
In summary, the 1% Tax Status Georgia 2026 remains one of the best tax benefits in the world

Contact Us: If you have questions about tax residency or VAT, feel free to email us at info@iakobadze.ge or visit our website iakobadze.ge