Georgia's Double Tax Treaties: Withholding on Dividends, Interest and Royalties
A Georgian company that pays its foreign owner, lender or licensor withholds tax at source. Georgia's treaty network can lower that withholding or remove it, but only if the paperwork exists before the payment is made. What the domestic rates are, what a treaty changes, and the certificate everything depends on.
Every cross-border payment a Georgian company makes to a non-resident carries a tax question that the Georgian side answers, not the recipient: how much to withhold at source. Georgia's default rates are low by international standards, and its treaty network can lower them further. The mistake founders make is assuming the treaty applies automatically. It does not. The company applies the domestic rate unless it holds, at the moment of payment, the evidence a treaty requires.
5%
Domestic withholding on dividends
The rate paid to a non-resident shareholder absent a treaty
50+
Treaties in force
58 on the Ministry of Finance's list on 13 October 2026: most of the EU, the UK, Switzerland, the Gulf, Turkey, China and others
Before
When the certificate must exist
Relief applied at payment needs the recipient's residence certificate on file
What Georgia withholds by default
The Tax Code sets withholding rates for the main categories of payment to non-residents. Dividends distributed by a Georgian company are taxed at source at 5%. Interest paid to a non-resident and royalties for the use of intellectual property are likewise subject to withholding at rates the Code sets, currently also 5% for most recipients, with higher rates for some categories and for payments to low-tax jurisdictions. These figures are the starting point, not the end of the analysis, and should be confirmed against the Code in force on the day of payment.
| Payment | Domestic withholding | What a treaty typically does | Paperwork before payment |
|---|---|---|---|
| Dividends to a foreign shareholder | 5% | Confirms 5%, or reduces to 0% for qualifying corporate shareholders under some treaties | Recipient's certificate of tax residence for the year of payment |
| Interest to a foreign lender | 5% for most lenders | Often 0% to 10%; some treaties exempt bank lenders | Certificate of residence; loan agreement on file |
| Royalties to a foreign licensor | 5% for most recipients | Commonly 0% to 10% | Certificate of residence; licence agreement showing what is paid for |
| Service fees to a foreign provider | Generally none where the service is performed abroad | Treaty rarely needed; the source rule decides | Contract and invoice showing where the service was performed |
How treaty relief actually works
- 1
Identify the treaty: the recipient must be a tax resident of a country that has a treaty in force with Georgia, and must be the beneficial owner of the payment, not an intermediary.
- 2
Obtain the recipient's certificate of tax residence from their own tax authority, issued for the relevant year, with a notarised Georgian translation. As the Minister of Finance's order on applying treaties reads at the time of writing, a certificate issued by a foreign competent authority needs no apostille or legalisation.
- 3
Keep the certificate and the underlying contract with the payment record. Where the treaty rate is lower than the domestic rate, the Georgian company withholds at the treaty rate at the moment of payment.
- 4
Report the payment and the withholding in the company's monthly return through rs.ge, identifying the treaty relied on.
- 5
Where the certificate arrives after the payment, withhold at the domestic rate and reclaim the difference from the Revenue Service; the reclaim route exists, but it is slower and it is the recipient's money in the meantime.
Where an international agreement of Georgia establishes rules different from those of the Tax Code, the rules of the international agreement apply. A tax agent applies the reduced rate or exemption provided by an agreement where the non-resident's residence in the contracting state is confirmed in the manner established by the Ministry of Finance.
The reverse direction matters just as much. A Georgian company or founder receiving income from abroad will be asked by the foreign payer for a Georgian certificate of tax residence, issued by the Revenue Service through rs.ge. Request it before invoicing, not after the foreign payer has already withheld at their domestic rate.
Where founders get it wrong
- Paying the dividend first and collecting the certificate later. The company has then withheld at 5% when the treaty allowed less, and the recipient must reclaim through a procedure that takes months.
- Relying on the founder's passport. Treaty residence is tax residence, evidenced by a certificate for the relevant year, not by nationality.
- Routing through a holding company with no substance in the treaty country. Beneficial ownership is tested; a conduit that merely passes the payment on may be denied the treaty rate.
- Ignoring the low-tax jurisdiction list. Payments to entities in jurisdictions Georgia treats as low-tax attract higher withholding and stricter scrutiny regardless of any treaty claim.
The German shareholder who wanted the treaty rate
A Georgian LLC owned by a German GmbH decides its first distribution. The German parent expects the reduced treaty rate for corporate shareholders and asks for the full amount net of that rate.
- 1The Georgian company checks the Germany treaty: the reduced rate applies to a company holding a qualifying share of the capital, which the parent does.
- 2The parent obtains a certificate of tax residence from its German tax office for the current year and sends the original with a notarised Georgian translation.
- 3The distribution is resolved, the treaty rate is withheld at payment, and the monthly return through rs.ge identifies the treaty and the certificate.
- 4The certificate is filed with the resolution and the bank transfer record, so a later Revenue Service query is answered from the file rather than reconstructed.
The reduced rate was applied at source because the evidence existed before the payment. The same distribution made a month earlier, before the certificate arrived, would have been taxed at 5% with the difference recoverable only through a reclaim.
Treaty rates and holding thresholds differ by treaty and change over time; the current text of the relevant treaty governs.
Next step
Paying abroad from a Georgian company
Before the first distribution, interest payment or licence fee leaves Georgia, we check the treaty, the beneficial ownership position and the certificate you need, and put the file in order so the reduced rate is applied at payment rather than reclaimed later.
Book a call about withholdingGeneral information, not tax advice. Withholding rates, treaty rates, the list of treaties in force and the procedure for applying a treaty are set by the Tax Code of Georgia, the treaties themselves and Ministry of Finance orders, and are subject to change.