Georgia is becoming increasingly attractive for businesses operating in the fields of information technology and digital services. The main driving factor behind this trend is the preferential tax regimes operating in the country.

Today, technological and innovative businesses can take advantage of two main opportunities and obtain the status of an International Company or an Innovative Startup.

However, obtaining these statuses is associated with quite complex criteria and regulations. Below, we will discuss in detail what each of them entails, what benefits they provide, and what stages a business will have to go through to obtain them.

Who is eligible and what is the International Company status?

An International Company is a Georgian enterprise that carries out activities permitted by the Government (mainly IT, software development, digital services, and web technologies) and receives income solely from these activities.

To obtain the status, a business must meet several important conditions:

2-year experience: The enterprise must have at least 2 years of experience in the permitted activity;
Real economic activity: The company must carry out its activities in Georgia; namely, it must have appropriately qualified employees (human resources) and incur operating expenses within the country;
Export of services: It is mandatory that the company provides services to entities registered or having a place of management outside of Georgia.

It should be noted that a company with this status has the right to receive other, accompanying income, provided it does not exceed 2% of the income received from the permitted (main) activity during the year.

Tax Benefits

If the status is granted, the tax burden for the company is radically reduced. International Companies enjoy the following benefits:

Personal income Tax: Personal income tax in an International Company is 5%, instead of the standard 20%;
Corporate income tax: The corporate income tax rate for the company is reduced from 15% to 5%;
Dividend: The issued dividend is not taxed at the source of payment at all (0%) and is not included in the gross income of the recipient;
Property Tax: The company is exempt from property tax (except for land) if this property is used for permitted activities.

Who is eligible and what is the Innovative Startup status?

The Innovative Startup status is another attractive alternative for entrepreneurial entities that carry out innovative activities and meet the requirements provided by law for granting the innovative startup status. To obtain the status, a business must meet the following criteria:

Innovative profile: The company creates an innovative product, process, or provides an innovative service;
Attracted financing: Within the last 2 years prior to submitting the application, it has obtained at least 100,000 GEL in investment (from an investment fund, accelerator, or angel investors) or a state grant of at least 150,000 GEL;
Targeted activity: The expenses incurred and income received by the company are substantially related directly to the funded innovative activity;
Clean financial history: At the time of granting the status, the company has no tax arrears, is not registered in the debtor's registry, and is not undergoing liquidation or insolvency proceedings.

Tax Benefits and Validity Periods of the Innovative Startup

The status is granted to a business for a period of 1 year. However, it can be extended annually for a maximum total of 10 years. The reduction of the tax burden is scheduled over time and is distributed by years as follows:

During the first 3 years: The issued salary is fully exempt from personal income tax (within the limits set by the government);
From the 4th to the 6th year inclusive: The corporate and personal income tax rates are reduced and set at only 5%;
From the 7th to the 10th year inclusive: The corporate and personal income tax rates are set at 10%.
It is impermissible for an entity to simultaneously hold the status of an Innovative Startup and an International Company (or a Virtual Zone Person - which represents another preferential regime in the IT sector, to be discussed in detail in our future blog). The acquisition of either of the new statuses by the company automatically leads to the cancellation of the existing status.

Exception in the New Labor Migration Rules

It should be noted that the new labor migration regulations enacted in Georgia from March 1, 2026, provide a significant exception for businesses holding the status of either an International Company or an Innovative Startup.

Specifically, businesses with these statuses are exempt from the mandatory so-called "Labor Market Test" when employing a foreign employee (labor immigrant), which relieves them of the bureaucratic obligations of publishing the vacancy in advance (10 working days prior) on the relevant portal, observing the 10-day period for searching for candidates on the local labor market, and providing a substantiated refusal to the candidates offered by the Agency.

Consequently, these companies can employ foreign specialists through a much-simplified procedure, although obtaining the right (permit) for labor activity remains a mandatory requirement for them. If you need assistance with navigating work permits or obtaining legal status for your foreign team members, explore Justice League's Labor Migration and Legal Support Services to see how our team can seamlessly handle the entire process for your business.

How are the statuses obtained?

To obtain the International Company status, the procedure begins by submitting an application to the Revenue Service. The application must necessarily be accompanied by documentation confirming experience in the permitted field of activity. It should be noted that the final decision is made by the Government of Georgia, and the status is granted to the company indefinitely.

As for the Innovative Startup status, in this case, the applicant entity submits an application to Georgia's Innovation and Technology Agency. After reviewing the appropriate documentation, the Agency forwards the application to the Ministry of Economy and Sustainable Development, while the final decision and the granting of the status are again ensured by the Government of Georgia. The company will be able to enjoy tax benefits from the first day of the month following the decision to grant the status.

Frequently Asked Questions (FAQ)

Is it possible for a company to hold both statuses simultaneously?

No. According to Georgian legislation, an enterprise is not allowed to simultaneously enjoy the status of an Innovative Startup and an International Company (or a Virtual Zone Person). Obtaining a new status automatically causes the cancellation of the existing one.

How long does it take to go through the procedures required to obtain the status?

Since the final decision on granting the status is made by the Government of Georgia, the exact timeframes for the procedure are not strictly defined by law. The duration of the process heavily depends on the completeness of the submitted documentation - a properly prepared, flawless application significantly speeds it up.

For what period is the International Company or Innovative Startup status granted to a company?

The International Company status is granted to a business indefinitely. As for an Innovative Startup, the status is issued for a 1-year term, although it can be renewed annually for a maximum total of 10 years.

Does an International Company have the right to receive income from another source?

Yes, however, other (accompanying) income received during the year must not exceed 2% of the income received from the permitted (main) activity.

When will the company be able to use the tax benefits?

The benefits come into effect from the first day of the month following the adoption of the decision on granting the status to the company.

What happens in case of the cancellation of the status or expiration of its validity period?

After the cancellation of the status or in the case of an Innovative Startup - the expiration of the 10-year period, the company automatically returns to the standard tax regime.

How can Justice League help you in obtaining the desired status?

Obtaining a desired tax status is a multi-step legal process that requires the company's full compliance with government regulations and the perfect organization of documentation. A correctly and competently prepared application significantly reduces the probability of a negative decision or additional requirements, which in practice is the most frequent reason for process delays.

The law firm Justice League offers full legal support throughout this process. We will assist you in perfectly preparing and legally verifying the documentation required to obtain both the International Company and the Innovative Startup statuses. Our team will ensure effective representation with the relevant state bodies so that your business can seamlessly, without unnecessary bureaucratic barriers, obtain the desired status and start enjoying the corresponding tax benefits.