Company Formation in Georgia
Georgia’s strategic location is an asset to any investor. As a bridge between Europe and Asia, Georgia offers direct access to European, GCC and CIS markets (more than 1 billion consumers). Georgia is a prime location for centralized market operations in the Black Sea Region and the preferred choice for Regional Headquarters and multi-country distribution centres, contact centres and shared service centres.
Advantages of Incorporating Business in Georgia
To prevent double taxation of income, Georgian tax legislation allows for credit to be given for profit tax paid outside Georgia against Georgian tax on foreign-source income.
Georgia offers competitive cost factors (labour, utilities, real estate, taxes).
Georgia’s workforce of 1.9 million people is highly educated – 30.8% have university degrees.
Georgia boasts low tariffs, streamlined border clearance procedures and preferential trade regimes with major partners, including the EU, the U.S. and free trade with Turkey and CIS countries. Georgia has been a member of the WTO since 2000 and has no quantitative restrictions on trade.
Georgia hosts an excellent infrastructure. Extensive public and private investment has developed a dynamic nationwide network of roads, railroads, waterways, harbours and airports.
Georgia’s foreign trade has been growing rapidly since 2003 as a result of aggressive policy reforms to make it easier and less expensive to trade across borders.
Georgia has no separate capital gains tax, capital gains generated in Georgia are included in Gross income and subject to corporate income tax at the standard rate of 15%.
The current standard rate of corporate income tax on all taxable income is 15%.
The standard rate of VAT is 18%.
The single flat rate of income tax is 20%, which will be reduced to 18% from 1 January 2013
Georgia does not levy any inheritance or gift taxes, but certain inheritances and gifts are subject to income tax
There is no wealth tax.
Types of Entities
Limited partnership: A limited partnership is composed of general partners and limited partners. The defining characteristic of a limited partnership is that limited partners can invest capital in a business of the limited partnership and take a share in the profits without becoming personally liable for partnership debts and obligations.
Corporation: A corporation is a legal entity that is separate from its owners, the shareholders. It is formed by filing certain documents with the Secretary of State and taking other actions required by the Code. A corporation may have perpetual existence, meaning that it continues to exist regardless of the status of the individual shareholders.
Limited Liability company: The Limited Liability Company (LLC) is a business entity organized under state law that offers limited liability like a corporation along with the possibility of “passthrough” taxation, unless it elects corporate treatment for federal tax purposes. Therefore, an LLC is a cross between a partnership and a corporation.
Sole proprietorship: The sole proprietorship is the simplest, least regulated and most common form of business organization. Legally and for tax purposes the individual owner is the business. The liabilities and profits are personal to the owner.
It usually takes 2 days to set up a business in Georgia.