🇬🇪 Tax Code Art. 82(1)(u) • 0% Foreign Passive Income Exemption

Georgia Foreign Sourced Income & Tax Residency Calculator

Determine Georgian tax exposure across foreign dividends, overseas bank interest, capital gains, and active remote work income under Georgia's territorial tax framework.

Quick Presets:

Statutory threshold: > 183 days grants tax residency

Applied to active work performed within Georgia

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Exempt under Art. 82(1)(u)

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Foreign bank deposits, bonds, securities gains

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Non-resident retirement pensions

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Remote consulting/coding while living in Georgia

Total Georgian Tax Liability
₾ 0.00
≈ $0 USD • Effective Rate: 0.00%
Residency Status: Tax Resident
Tax on Foreign Passive: ₾ 0.00 (0% Exempt)
Tax on Active Services: ₾ 0.00
Total Foreign Passive ₾ 0.00
Foreign Tax Exemption 100% (0% Tax)
Active Local Services ₾ 0.00
Effective Tax Rate 0.00%

Article 82 Territorial Tax Exemption Matrix

Income Classification Statutory Source Georgian Tax Rate Legal Basis Reporting Mandate
Foreign Corporate Dividends Non-resident entity 0% (Exempt) Tax Code Art. 82(1)(u) Non-taxable / Exempt
Foreign Interest & Bonds Non-resident bank / issuer 0% (Exempt) Tax Code Art. 82(1)(u) Non-taxable / Exempt
Foreign Capital Gains (Shares/Real Estate) Assets situated outside Georgia 0% (Exempt) Tax Code Art. 82(1)(u) Non-taxable / Exempt
Foreign Pension / Annuity Overseas government / scheme 0% (Exempt) Tax Code Art. 82(1)(u) Non-taxable / Exempt
Active Services via Small Business IE Performed in Georgia (remote) 1% (up to ₾ 500k) Tax Code Art. 88–90 Monthly RS.ge 20-day return
Active Services without Status Performed in Georgia (individual) 20% Flat PIT Tax Code Art. 79 & 104 Annual declaration by March 31

Territorial Tax Sourcing & Residency Rules in Georgia

Georgia maintains a territorial nuance for individual tax residents under Article 82(1)(u) of the Tax Code of Georgia. Under this statute, foreign-sourced passive income earned by a tax resident individual is fully exempt from Personal Income Tax.

Crucial Distinction: Passive vs Active Income

A common pitfall among international remote workers is assuming that working for a foreign client while living in Tbilisi or Batumi is "foreign income". Under Article 104, the legal source of service income is determined by the physical location where the work is performed. Because the physical labor is conducted within Georgia, the Revenue Service treats it-sourced income.

However, Georgia provides the highly advantageous Individual Entrepreneur with Small Business Status, allowing remote IT consultants, designers, copywriters, and developers to pay just 1% gross tax on turnover up to 500,000 GEL per calendar year.

Frequently Asked Questions

Is foreign passive income taxable in Georgia for tax residents?

Under Article 82, Part 1, Sub-paragraph "u" of the Tax Code of Georgia, income received by a resident individual that is not derived from Georgian sources is 100% exempt from Personal Income Tax (0% PIT). This covers foreign corporate dividends, non-resident bank interest, capital gains on foreign securities, and overseas pensions.

How does the Revenue Service of Georgia define Georgian-sourced active income?

Under Article 104 of the Tax Code, active income earned from performing services (consulting, software development, management) while physically situated within Georgia is legally classified-sourced, even if the clients, invoicing, and bank accounts are entirely abroad.

What are the requirements for physical tax residency in Georgia?

Under Article 34 of the Tax Code of Georgia, a natural person becomes a Georgian tax resident if they are physically present in Georgia for more than 183 days during any continuous 12-month period ending in the given tax year.

Can High Net Worth Individuals (HNWI) obtain Georgian tax residency without staying 183 days?

Yes. Georgia offers a specialized HNWI Tax Residency regime for individuals with confirmed worldwide net assets exceeding 3,000,000 GEL (or annual income exceeding 200,000 GEL for the past 3 years), provided they hold a Georgian residence permit or possess Georgian-sourced investments.

How can remote workers and freelancers legally minimize tax on active services performed in Georgia?

By registering Individual Entrepreneur (IE) with Small Business Status at RS.ge, eligible qualifying services (such development, architecture, digital design) are taxed at a preferential flat 1% of gross turnover up to 500,000 GEL annually, rather than standard 20% PIT.

MS

Engr. Muhammad Shahzad

Verified Compliance Author

Principal Civil & Systems Software Engineer specializing in international tax sourcing criteria, high-net-worth residency structuring, and Article 82 exemptions under the Revenue Service of Georgia (RS.ge).

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📊 Revenue Service of Georgia (RS.ge) & Pension Agency Matrix

Statutory Component / Legal Deduction Item Calculated Amount (GEL)
Primary Net / Statutory Payable Amount 0.00 ₾
MS

Engr. Muhammad Shahzad

Principal Financial Systems Architect & Caucasus Fiscal Integration & Revenue Service of Georgia Architect

Lead software and systems architect specializing in high-performance browser computing, algorithmic validation, financial models, and zero-telemetry client-side privacy architecture.

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