Owning real estate in Georgia can be profitable, but it is important to understand the tax nuances associated with renting and selling.

In this article, we will look at the taxation features of selling and renting real estate in Georgia.

Tax on income from real estate rental

• Tax rate: Income from real estate rental is subject to income tax at a rate of 5%. This means that 5% of the rental income received must be paid as tax.
• Ease of calculation: The flat tax rate makes tax planning more predictable for owners.

Profit tax on the sale of real estate

• Dependence on the period of ownership: The tax rate on profit from the sale of real estate depends on how long the property has been owned by the seller.
  • Less than 2 years: If the property has been owned for less than two years, the tax will be 20%. This is aimed at discouraging speculative real estate transactions.
  • More than 2 years: If the property has been owned for more than two years, the tax is reduced to 5%. This encourages long-term investment in real estate.
• Accounting for expenses: When calculating the tax, various expenses related to owning and improving real estate can be taken into account, which allows for a lower taxable base.

Value Added Tax (VAT) in Real Estate Transactions

• VAT Rate: The standard VAT rate in Georgia is 18%.
• Primary Sale of Residential Real Estate: Exempt from VAT.
• Resale of Real Estate: Subject to VAT if the seller is engaged in commercial activities related to the sale of real estate.
• Commercial Real Estate: Subject to VAT, but buyers registered for VAT can reclaim it.
• Renting: Rent payments are subject to VAT if the owner is registered as a VAT payer.

Special conditions for non-residents

For foreign citizens who are not tax residents of Georgia, special tax rules may apply. Consultation with a tax specialist will help to understand your individual situation.

Why choose ESPERO group?

• Comprehensive approach: We offer a full range of tax consulting services in the field of real estate.
• Experience and professionalism: Our specialists have extensive experience working with foreign clients.
• Individual approach: We take into account the characteristics of each client and select the best solutions.

ESPERO group will take care of all the concerns related to the taxation of your real estate in Georgia. All you have to do is take care of your business.

Contact us for a free consultation and find out how to optimize your tax payments!

ESPERO group services

• Tax calculation: Accurate calculation of all types of taxes related to real estate.
• Preparation of tax returns: Preparation and filing of tax returns for all types of real estate.
• Consultations on tax planning: Development of an individual tax planning strategy.
• Support for tax audits: Representation of your interests during tax audits.

We guarantee confidentiality and professionalism in our work.

Contact us right now!