Georgia’s profit tax works differently from most countries. A company does not pay profit tax on earned profit while it stays in the company; the tax is due when profit is distributed. This guide explains the rule from the Tax Code.
The rate
The profit tax rate is 15% (Article 98). A special 10% rate applies only to profit from oil and gas operations under certain agreements signed before 1 January 1998.
What is taxed (Article 97)
For a resident enterprise the objects of profit taxation are:
- Distributed profit: profit given to a partner as a dividend, in cash or in kind (Article 98-1).
- Costs or payments not related to economic activity.
- Free supply of goods or services, or transfer of funds.
- Representation expenses above the limit set by the Code.
This means retained and reinvested profit is not taxed as profit tax until it is distributed. Reinvestment decisions therefore have a direct tax effect.
Dividend tax at source
Dividends paid by a resident enterprise to a natural person, a non-commercial legal entity or a non-resident enterprise are taxed at source at 5% of the amount payable (Article 130). Dividends received by enterprises of the types in Article 2(1) of the Law on Entrepreneurs, other than an individual entrepreneur, are not taxed at source and are not included in the receiving enterprise’s gross income.
How it fits together
- Profit stays in the company: no profit tax on it.
- Profit is distributed as a dividend: 15% profit tax on the distribution and 5% withholding on the dividend for the receiving person, as the Code sets out.
- Non-business costs and free supplies are taxed as profit-tax objects even without a dividend.
The exact calculation base for distributed profit, and exceptions, are in Articles 97 to 98-4. Ask us before planning a dividend.
Related guides
See VAT in Georgia and our business in Georgia guide.
MITC keeps your books, files your returns and checks which regime fits you. Contact us for a consultation.
Source: Tax Code of Georgia, consolidated version of 28 October 2026 (matsne.gov.ge), Articles 97, 98, 98-1 and 130. Last verified: 7 November 2026. Rates and rules can change; confirm them with MITC or the Revenue Service before acting.
