A plain-language guide to Georgian property tax, rental income tax, and capital gains rules for non-resident foreign investors. What you owe, and what you do not.
Zero capital gains tax on property held over two years. This is not a loophole — it is the law.
Georgia’s tax framework for property investors is one of the most straightforward in Europe or the near-abroad. The rules are clear, the rates are low, and the administration — since a major reform in the early 2000s — is genuinely functional. This note covers the key taxes relevant to a foreign individual buying and renting residential property in Tbilisi.
This is general guidance, not legal advice. Tax circumstances vary. Consult a Georgian tax lawyer before making decisions.
Property tax
Annual property tax in Georgia is assessed on the cadastral value of the property, which is set by the government and typically below market value.
Rate: 0.05%–1% of cadastral value per year, depending on the owner’s income level and the property value.
For most foreign investors holding a single Tbilisi apartment, the annual property tax is nominal — commonly $100–$400/year on a $150,000 property.
There is no stamp duty or transfer tax on purchase beyond the registration fee (approximately $50 at the Public Registry).
Rental income tax
For non-resident individuals (those who spend less than 183 days per year in Georgia):
Rental income from Georgian property is subject to Georgian income tax at a flat rate of 20% on net rental income (gross income minus allowable expenses). Allowable expenses include management fees, maintenance, utilities paid by the landlord, and depreciation.
A simplified alternative: some non-residents opt for the 5% flat tax on gross rental income through the “Small Business” registration. This is simpler administratively but may be less efficient if your expense ratio is high.
For resident individuals (183+ days per year):
Residents are taxed on worldwide income. Georgian-source rental income is taxed at 20% of net income, with the same deductibles. Double taxation treaties with various countries (Russia, Germany, France, UAE, and others) may reduce the effective rate.
VAT on rental income
Short-term rental (Airbnb-style) is generally treated as a service, not just rental income. If annual turnover from short-term rentals exceeds 100,000 GEL (~$37,000), VAT registration at 18% is required.
Most single-property investors remain below this threshold. If you hold multiple properties under active short-term management, you may need to structure through a Georgian LLC to manage VAT obligations efficiently.
Capital gains tax
This is where Georgian law is unusually generous.
An individual who sells residential property held for more than 2 years pays 0% capital gains tax — regardless of nationality or residency status.
If held for less than 2 years, the gain is treated as income and taxed at 20% of the net gain.
The 2-year rule applies to the property, not the owner. Clock starts at title registration.
Inheritance and gift tax
Property transferred by inheritance or gift between close family members is generally exempt from Georgian gift/inheritance tax. Transfers to non-family members are taxed at 10% of assessed value.
Practical considerations
Georgian tax ID: You will need a Georgian taxpayer identification number (TIN / PIK) to register title and, if applicable, to file rental income declarations. This is straightforward to obtain from the Revenue Service.
Declaration filing: Non-resident landlords with Georgian rental income should file an annual income declaration by April 1 of the following year. This is a simple one-page form if your income structure is uncomplicated.
Double taxation: Georgia has double taxation avoidance treaties with many countries. If you are paying tax on Georgian rental income in Georgia, you may be able to credit this against your home country’s tax liability. Check the specific treaty for your country.
Summary
| Tax | Rate |
|---|---|
| Annual property tax | ~0.1–0.5% of cadastral value |
| Rental income tax (non-resident) | 20% of net, or 5% flat on gross |
| Capital gains (held 2+ years) | 0% |
| Capital gains (held under 2 years) | 20% of net gain |
| VAT on short-term rental | 18% (if over 100,000 GEL/year) |
| Property registration fee | ~$50 |
The headline: Georgia is one of the few places where a foreign individual can buy residential property, rent it out, hold it for two years, and sell it with no capital gains liability. Combined with low property tax and competitive income tax rates, the after-tax return on Georgian real estate is structurally better than most comparable markets.