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How do you open and close a sole proprietorship in Georgia?

Registering, small business status and closing.

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Short answer

A sole proprietorship in Georgia is opened at a Public Service Hall or through the National Agency of Public Registry, then you apply separately to the Revenue Service for small business status to pay 1% of turnover. Closing is also done through the registry, but first you must file all returns and settle tax liabilities. Small business tax is paid monthly through the rs.ge portal.

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Why

  1. Small business status is granted by the Revenue Service on application.
  2. If annual turnover exceeds 500,000 GEL, the rate rises and the status may be lost.
  3. Tax residency and sole trader registration are separate; one does not automatically give the other.

Details

Even with no income, the small business return must be filed every month, or penalties apply. Before closing, check your rs.ge account for any outstanding debt.

Tip

Right after registering, apply for small business status, or your tax rate will be higher.

What may differ

Rules change and depend on citizenship and status, so check the official website or a lawyer before applying.

Common misconception

Being an individual entrepreneur lets a foreigner work in Georgia without any permits.

What actually happens

Since 1 March 2026, foreigners, including entrepreneurs, generally need a labour activity permit.

People also ask

  • How do I close a sole proprietorship in Georgia?

Sources

This answer is for reference only and is not legal advice. Since March 2026, under the labour migration law, foreigners may in some cases need a work authorisation for employment or business activity in Georgia; check current rules on the labour migration portal.

How to Close a Company in Georgia: LLC and IE Liquidation

  • Does a foreigner need a work permit in Georgia?

    Yes: since 1 March 2026, foreigners generally need a labour activity permit to work legally in Georgia, including individual entrepreneurs and the self-employed.

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  • What does Georgia produce, and what drives its economy?

    Georgia's economy rests mainly on services: tourism, trade, transport and the transit of goods between Europe and Asia, as well as construction.

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  • How can a foreigner register a business in Georgia?

    A foreigner can register a company in Georgia, usually an LLC, or become an individual entrepreneur through a Public Service Hall or the National Agency of Public Registry, with registration taking from one working day.

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  • What are the taxes and VAT in Georgia?

    In Georgia, income tax is 20%, VAT is 18%, corporate profit tax of 15% is paid only on distributed profit, and dividends are taxed at 5%.

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