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Many property and vehicle owners in Georgia mistakenly believe that the property tax applies only to Georgian citizens or only to high‐value real estate. In practice, the obligation to file a tax return may apply to both tax residents and non‐residents of Georgia, including foreign citizens who own an apartment, a house, a car, or a plot of land.
In this article, we will discuss:
- who is required to file a tax return;
- what property must be declared;
- how family income is calculated;
- what special provisions apply to non‐residents;
- what has changed with regard to foreign property owners;
- what deadlines for filing tax returns and paying taxes are established by Georgian law.
Brief: key deadlines
| Action | Deadline |
|---|---|
| Filing a property tax return | by November 1 |
| Tax payment | by November 15 |
What property must be declared
The following may be subject to personal property tax in Georgia:
- apartments;
- residential houses;
- commercial real estate;
- properties under construction;
- cars;
- yachts and boats;
- airplanes and helicopters;
- land parcels.
It is important to understand that simply owning property does not automatically mean you are liable for the tax. In many cases, the tax liability depends on the total family income.
Who is required to file a tax return
Tax residents of Georgia
For tax residents of Georgia, the obligation to pay property tax generally arises if the total family income for the previous year exceeds 40,000 lari. When determining eligibility for a tax exemption, the family’s income is taken into account, not just the property owner’s income.
If the family’s income does not exceed 40,000 lari per year, property tax generally does not apply (with the exception of certain cases related to land tax).
Non‐residents of Georgia
As of the beginning of 2024, the Georgian Tax Service has officially clarified the procedure for taxing property owned by foreign owners.
If an individual is not a tax resident of Georgia and owns property in the country, the tax authority expects them to file a property tax return indicating their total worldwide family income. If the return is not filed, the tax authority has the right to assess tax at the maximum rate based on the market value of the property.
Therefore, foreign owners of real estate or vehicles in Georgia are currently advised to file a property tax return even in cases where no tax is actually due.
What counts as income for tax calculation
It is important to distinguish between several categories of individuals here.
For a resident of Georgia
The total family income subject to taxation in Georgia is taken into account and used to determine the property tax liability.
For a non‐resident who is not a citizen of Georgia
According to clarifications from the tax authority, the entire aggregate worldwide family income is taken into account, regardless of the country where the income was earned. It is this figure that determines liability for property tax.
What tax rates apply
The amount of tax depends on the family’s income and the municipality where the property is located.
| Total family income | Tax rate |
|---|---|
| Up to 40 000 GEL | Generally no tax is due |
| From 40 000 to 100 000 GEL | 0,05 — 0,2 % |
| Over 100 000 GEL | 0,8 % — 1 % |
The specific tax rate is set by the local municipality within the limits established by the Tax Code.
Features of the land tax
Land parcels are classified as a separate category.
If an individual owns a land parcel, the obligation to declare it applies regardless of the family’s income level. Special tax rules apply to land.
Therefore, even if a family’s income is less than 40,000 lari per year, owning a land plot may require filing a tax return.
Do you need to declare a car?
Yes.
If a car is registered in Georgia under an individual’s name, it must be included in the asset declaration if the individual is required to file one.
The age of the vehicle is irrelevant. Both old and new cars are declared in the same way.
How is income from sole proprietorships reported?
This is one of the most frequently asked questions among entrepreneurs.
Microbusiness
Income earned under the microbusiness regime is not included in the calculation of household income for property tax purposes. Legal basis: Article 202 of the Tax Code of Georgia. (This position is also reflected in the explanations provided in the source materials.)
Small business (1 %)
For entrepreneurs with small business status, only 25 % of annual income — rather than the entire turnover — is included in family income. This significantly affects the determination of property tax liability.
General taxation system
Taxable income (profit) is taken into account, that is, income after deducting expenses and allowances provided for by law.
What to do if property is sold
It is important to distinguish between:
- the annual property tax return;
- the tax return for income from the sale of property.
Starting in 2024, a special procedure for reporting income from the sale of property applies to individuals who receive income from the sale of assets outside the scope of their business activities. If taxable income was received from the sale (for example, a profit from the resale of real estate or a car), the return must be filed by the 15th day of the month following the month in which the income was received, and the corresponding tax must be paid by the same deadline.
This is a separate obligation not directly related to the annual property tax return.
What happens if you fail to file a return
For tax residents, the consequences depend on the specific situation and may include a tax audit.
For foreign property owners, the risk is significantly higher. According to guidelines published by the Revenue Service, if a nonresident fails to file a return and report information about their income, the tax authority may calculate the tax at the maximum rate based on the market value of the property.
Therefore, failure to file a return may result in a significantly higher tax liability than if the return had been filed on time.
Frequently asked questions
Do I need to file a tax return if I bought my apartment many years ago?
Yes. The age of the property is irrelevant. If you are required to file a tax return, the property must be reported on the return regardless of the date of purchase.
Do I need to report my apartment if it is not rented out?
Yes. The mere fact of owning the property may require it to be included in the tax return.
Do I need to file a tax return if I have no tax due?
In many cases, yes. This applies especially to foreign owners of real estate and vehicles in Georgia.
What if a tax return was filed last year, but the family’s income has fallen below 40,000 GEL?
The taxpayer must notify the tax authority that they are not required to file a tax return for the current year. This position is reflected in the tax service’s guidelines.
Conclusion
Property tax in Georgia is not limited to apartments and houses. Cars, land parcels, and other property may also be subject to declaration. Foreign owners of real estate and vehicles should pay particular attention: starting in 2024, the Georgian tax authority has taken a stricter stance and expects property tax returns to be filed even if no tax is due.
If you own property in Georgia and are unsure whether you are required to file a return, it is best to check your situation in advance. An error or missing the deadline could result in tax being assessed at the maximum rate, fines, and further inquiries from the tax authority.
ESPERO assists in analyzing your filing obligations, preparing and filing property tax returns, and provides advice on the taxation of real estate, vehicles, and land parcels in Georgia.