How to Apply for IT International Company Status in Georgia: The Complete 2025 Guide
- Tinatin Tolordava
- 7 days ago
- 9 min read
Table of contents
Why IT companies are relocating to Georgia
Georgia isn’t just a pretty place to take Zoom calls. It’s quickly becoming a serious contender for global IT businesses looking for low tax, easy administration, and legal stability. The country offers something few others do: a 5% corporate tax rate and 0% dividend tax for companies with IT International Company status. For startups and scale-ups alike, it’s a game-changer.
But here’s what many founders get wrong: they confuse IT International Company status with the Virtual Zone. Same tax perks? Not quite. Same reporting rules? Not at all.
If you’re considering applying for IT International Company Georgia benefits, this is the guide you need. We’ll explain what it is, how it compares to other models like the 1% individual entrepreneur regime and Virtual Zone, and walk you through how to qualify, apply, and stay compliant.
What is IT International Company Status in Georgia?
This status was created by the Georgian government to attract real software development, data processing, and web-based product companies. Not shell companies. Not holding entities. Actual tech operations.
It gives you:
5% corporate profit tax (instead of 15%)
0% dividend tax (if distributed to a foreign shareholder)
5% personal income tax for Georgian employees (vs. the usual 20%)
But unlike the Virtual Zone, which is more flexible, this status comes with heavier compliance. You’ll need employees, payroll, physical presence, and formal operations in Georgia.
Who qualifies for IT International Company status?
Not every business with a website and an idea can apply. Your business must fall into one of the qualified IT activities, such as:
Software development
Computer programming
SaaS platform creation
Hosting and cloud computing
Data processing and management
AI and machine learning services
Web and mobile app development
And the business must be conducted from Georgia.
You must also have:
An LLC or JSC registered in Georgia
At least 2 full-time employees or contractors paid through Georgian payroll
A commercial lease or physical presence in Georgia
Georgian tax residency (for the company)
This isn’t a status for freelancers or remote-first agencies without roots. It’s for companies that want to scale internationally with a Georgian base.
IT International Company vs Virtual Zone: What’s the Difference?
Many founders compare the two because they both offer tax benefits. But the requirements and outcomes are very different.
Criteria | IT International Company | Virtual Zone |
Corporate Tax | 5% | 0% (only on foreign-sourced income) |
Dividend Tax | 0% (for non-residents) | 5% |
VAT | 0% (if services provided to non-residents) | 0% |
Employees Required | Yes | No |
Office or Lease | Yes | No |
Monthly Reporting | Required | Required |
Audit | Likely | Rare |
For a full breakdown of the taxation and accounting impacts of both statuses, read our blog on Virtual Zone and International Company Status: Impact on Accounting & Taxation.
If your business is truly scalable and tech-driven, the IT International Company Georgia route is more sustainable. If you're just testing markets or working alone, the Virtual Zone may be easier to start with.
Legal Structure: LLC is Mandatory
To apply for IT International Company status in Georgia, you must operate through a Limited Liability Company (LLC). Individual entrepreneurs (I.E.) are not eligible, and JSCs are rarely used unless you’re planning large investment rounds.
Why LLC?
You can issue dividends
You can hire and pay salaries
You can sign contracts with international clients
You can open business bank accounts in Georgia and abroad
If you’re currently operating as an I.E. under the 1% tax regime, and want to upgrade, read our guide on How the 1% Tax Regime for Individual Entrepreneurs in Georgia Works, and How to Qualify
Tax Advantages of IT International Company Georgia
Now for the part that usually grabs headlines, taxes. Here’s what you’re actually saving with this status:
Corporate Profit Tax: 5%Regular rate is 15%. That’s a 10% savings on all distributed profit. And remember, Georgia only taxes distributed profit. If you reinvest, you don’t pay.
Dividend Tax: 0%If you’re a non-resident shareholder, you can extract dividends tax-free. Compare that with most EU countries charging between 10% and 30%.
Personal Income Tax: 5%If you employ Georgian residents under IT International Company status, you only pay 5% income tax for them. Normally, this is 20%.
VAT: 0% on exported servicesIf your clients are outside Georgia and you issue VAT-exempt invoices correctly, you don’t pay VAT.
Add it all up and you’re looking at one of the most favorable tax systems in the world for tech companies.
When to switch from I.E. or Virtual Zone to IT International Company
You don’t have to jump in on day one. Many founders begin as I.Es or Virtual Zone companies and switch later. But knowing when to upgrade is key.
You should consider switching if:
You’re crossing 500,000 GEL in annual turnover
You need to hire developers or admin staff
You’re onboarding international clients under long-term contracts
You plan to raise investment or work with large corporate clients
Your Virtual Zone exemption is under risk due to sourcing issues
If you're deciding between remaining a solo entrepreneur or scaling with a legal structure, read this comparison:Georgia’s I.E. Registration vs LLC: Which Is Right for Freelancers, Consultants, and Startups
The Application Process Step-by-Step
Here’s how to apply for IT International Company status in Georgia properly:
1. Register an LLCSet up a Georgian Limited Liability Company. Make sure your NACE codes (business activity codes) reflect qualified IT services.
2. Set up operationsSign a commercial lease agreement or register a home office. Hire at least two full-time staff or contractors and run payroll.
3. Prepare your documentation.
You’ll need:
Company charter
Lease agreement
Employment contracts
Financial forecasts
Description of services
List of clients and active contracts
Explanation of how services are delivered from Georgia
4. Submit to the Ministry of FinanceYour application is filed through the Revenue Service. Gegidze prepares the full package for you and handles correspondence.
5. Wait for approvalThis takes 10–30 business days. If approved, your company is assigned IT International Company status officially and gets the tax benefits from that date onward.
After Approval: What Changes and What You Need to Watch
Getting your IT International Company Georgia status approved is a win, but that’s not the end. The real work begins after you receive your certificate.
From that point on, the tax authority expects your company to comply with more detailed rules than a standard LLC or Virtual Zone entity. That includes monthly reporting, payroll compliance, document retention, and in some cases, audits.
Monthly Tax Filing Requirements
Once your status is granted, your LLC is now under the Ministry of Finance’s watch with specific tax advantages, but only if you meet your obligations.
Each month, you’ll need to:
Submit Form 100 (Payroll Report): Shows all salaries paid, income tax withheld (5%), and pension contributions.
Submit VAT Return (Form 007): If applicable. Most IT International Companies serving non-residents are VAT exempt.
File reverse VAT declarations (if you use foreign services, e.g., Zoom, AWS).
Report on withholding tax if you work with foreign contractors.
While this sounds heavy, it becomes manageable with the right accounting partner.
Skipping or misreporting any of these can trigger fines or lead to a review of your status.
Annual Profit Declaration
Even though Georgia only taxes distributed profits, you’re still expected to file an annual Form 500. This form shows your total income, deductible expenses, reinvested amounts, and any profits declared as dividends.
If you reinvest all your profits, you’ll pay 0% corporate tax.
If you distribute profit to a foreign shareholder, you’ll pay just 5%.
If you distribute to a Georgian resident, it’s 5% dividend tax.
Be very clear on who your shareholders are, their residency status, and your distribution policy. The wrong move here can cancel out your tax benefits.
Financial Reporting & Accounting Standards
As an IT International Company, your accounting needs to match Georgian standards.
This means:
Bookkeeping in Georgian GEL
Reports filed through RS.ge
Revenue and expense tracking aligned with local rules
It doesn’t matter if your operations use Stripe, Wise, or Revolut. Your financial reports must match what the Revenue Service expects.
That’s why most companies use hybrid systems:
Tools like Xero or QuickBooks for internal control
A Georgian accountant for filing and conversion
We explain how to do that in detail here: Virtual Zone and International Company Status: Impact on Accounting & Taxation
Payroll and Local Employment Rules
To maintain your status, you must keep at least 2 full-time employees or contractors paid through Georgia. That doesn’t mean they have to be developers, but they must be actively working and on a legitimate contract.
For each local employee, you must:
Pay salary via a Georgian bank
Withhold 5% income tax
Contribute 2% to the pension fund (for Georgian citizens)
Report monthly on Form 100
If your employees are foreigners on long-term assignments, you may still be responsible for some taxes depending on their visa and residency status.
Not sure how to manage this? Gegidze offers full payroll setup and monthly handling so you stay compliant without overhiring back office staff.
Banking and Currency Management
Once you receive IT International Company status, you’ll likely need to juggle GEL, USD, and EUR accounts. Georgian banks require:
Local bank accounts for tax payments
GEL payments for salaries
Proof of origin for international transfers
The main risks are:
Failing to convert income properly (e.g., not reporting USD inflows in GEL)
Delayed or frozen transfers due to vague contracts
Lack of documentation for foreign payments
Make sure your banking, invoices, and contracts are airtight. The Revenue Service can ask for source documents at any time, especially when large payments come in.
Common Mistakes That Lead to Status Revocation
Here’s where things get real. Georgian tax authorities can revoke your IT International Company status if you:
Stop paying staff through Georgian payroll
Fail to submit monthly filings
Operate outside approved IT activities
Misreport foreign vs domestic revenue
Fail to maintain real operations in Georgia
You don’t need to be a massive team, but you do need to prove you’re really operating from Georgia. That includes contracts, meeting notes, active client work, and staff activity.
We’ve seen companies lose their status due to something as simple as skipping a few months of payroll or not updating their lease agreement.
That’s why Gegidze works closely with founders to keep everything documented and aligned with Revenue Service expectations.
Who Should Not Apply
Even with all these benefits, this status isn’t for everyone.
Don’t apply if:
You’re a solo freelancer with no team
You can’t hire or afford local staff
You don’t have actual client contracts or real activity yet
You’re operating as a consultant with changing business models
In that case, the Virtual Zone or I.E. 1% tax regime might make more sense.
What If I Already Have a Company?
Good news, you don’t have to start over.
If you already run a Georgian LLC and meet the requirements, you can upgrade.
Gegidze will:
Review your charter and NACE codes
Adjust your lease and staff agreements
Rewrite your service descriptions to align with approved activity
Refile your status application
Align your accounting with RS.ge formats
It’s faster than registering from scratch, and you keep all your contracts and banking in place.
What About Non-Tech Activities?
Only specific IT activities qualify for the IT International Company status. Marketing, design, translation, consulting, and other services don’t.
You can’t apply just because you run a remote-first company.
But if you operate an AI SaaS platform or run full-stack development projects with clients worldwide? You’re a prime candidate.
For a full comparison of qualifying vs non-qualifying business models, schedule a consultation with our legal team.
If you’re building a serious tech business and want to optimize your taxes, simplify compliance, and get access to one of the most founder-friendly jurisdictions in Europe, don’t waste time figuring it out alone.
We’ll help you:
Check if you qualify
Plan the best legal structure
Apply for the right tax status
Handle monthly filings and payroll
Avoid costly surprises
Build it right from the start, with a partner who’s done it hundreds of times.
Frequently asked questions (FAQ)
What is the IT International Company status in Georgia?
The IT International Company Georgia status is a special tax regime for eligible tech companies operating from Georgia. It offers 0% corporate tax on reinvested profits and 5% on distributed dividends, plus VAT exemptions for services exported outside Georgia.
Who qualifies for IT International Company status in Georgia?
To qualify, your Georgian-registered LLC must engage in approved IT activities like software development, AI, or SaaS. You need at least two full-time employees or contractors and a legal office or lease agreement in Georgia.
How is IT International Company status different from Virtual Zone?
The Virtual Zone is for companies exporting digital services, but it only applies to corporate tax. IT International Company Georgia status offers broader tax benefits including reduced income tax on payroll, VAT exemptions, and favorable dividend treatment, but with stricter compliance.
Can a foreigner apply for IT International Company status in Georgia?
Yes. Foreign founders can register an LLC in Georgia and apply for IT International Company status remotely. However, you'll need to prove real activity in Georgia, including payroll, office presence, and ongoing client work.
What happens if I lose my IT International Company status?
Losing the status means losing all associated tax benefits. You’ll revert to Georgia’s standard 15% corporate tax on profits and may face penalties if non-compliance is found. Ongoing compliance, payroll, and proper reporting are critical to maintain the status.
