Tax Residency for Crypto Investors - Georgia as a Tax Haven

19.05.2025

• Tax Residency Rules in Georgia
• Taxation of Crypto in Georgia
• Cryptocurrency Mining in Georgia
• Becoming a Resident
• Key Advantages for Crypto Investors
• Considerations
• Contact our lawyer for more details

Georgia has become increasingly popular among crypto investors and digital nomads due to its favorable tax policies and overall business-friendly environment. 

Tax Residency Rules in Georgia

• 183-Day Rule: A person is considered a tax resident in Georgia if they spend more than 183 days in the country during a tax year. If a live in Georgia for more than six months, you will be considered a resident for tax purposes.
• Other: If one maintains his/her primary place of business or primary economic interests in Georgia, he/she might be considered a tax resident.

Taxation of Crypto in Georgia

For Individual Traders:

• Income Tax: Profits from cryptocurrency trading are exempt from income tax for Georgian resident individuals. This exemption applies because such income is considered foreign-sourced and, therefore, not taxable in Georgia.  
• Value Added Tax (VAT): The exchange of cryptocurrencies into national or foreign currencies is not subject to VAT. This treatment aligns cryptocurrency transactions with money exchanges, which are outside the scope of VAT.  

For Legal Entities:

• Corporate Income Tax: Georgian companies engaging in cryptocurrency trading are subject to a 15% corporate income tax on their profits. Notably, Georgia employs a system where this tax is only payable upon the distribution of profits (similar to the Estonian model). Therefore, if profits are reinvested rather than distributed, the corporate income tax is deferred.  
• Dividend Tax: When dividends are distributed, an additional 5% withholding tax applies. 
• VAT: Similar to individuals, companies are not required to pay VAT on the sale or exchange of cryptocurrencies.  

Special Considerations:

• Small Business Status (SBS): Georgia offers a Small Business Status with a preferential tax rate of 1% on turnover for qualifying businesses. However, the applicability of SBS to cryptocurrency trading is uncertain. If the National Bank of Georgia classifies crypto trading as a "currency operation," it may disqualify such activities from SBS benefits. Additionally, exceeding an annual turnover of 500,000 GEL results in the loss of SBS.  
• Tax Residency: To benefit from these tax provisions, individuals should consider establishing tax residency in Georgia. This can be achieved by spending at least 183 days in the country within a 12-month period or through the High Net Worth Individual (HNWI) program, which has specific asset or income requirements. 

Cryptocurrency Mining in Georgia

Georgia is known for its crypto mining industry due to its low electricity prices and favorable tax regulations. Crypto miners are treated similarly to individual investors, meaning they can benefit from the lack of taxation on crypto profits.

No Inheritance or Gift Tax

There is no inheritance tax or gift tax in Georgia on:

• the value of property received as a gift or inheritance by heirs of the first and second degree;
• the value of property received as a gift up to 1,000 GEL, except for the value of property received as a gift by the tenant from the landlord;
• the value of property received as a gift or inheritance by heirs of the third and fourth degree up to 150,000 GEL.

This could be attractive to crypto investors who want to pass down assets without incurring large tax liabilities.

Banking and Payments

While Georgia has a progressive stance toward cryptocurrency, access to banking for crypto businesses and individuals may require some extra steps. Many crypto businesses in Georgia use local banks for payment processing, but it’s still advisable to work with crypto-friendly banks to avoid any issues.

Double Taxation Agreements

Georgia has signed double taxation treaties with several countries, which can help minimize tax liabilities if you’re a resident of another country. These treaties are designed to prevent double taxation of income.

Becoming a Resident

If you’re not already a Georgian citizen, you can apply for temporary residency (1 year) and later apply for permanent residency. Georgia also offers special visa programs for digital nomads and remote workers, which can make it easier for crypto investors to live and work there.

Key Advantages for Crypto Investors

• No capital gains tax on crypto
• Low personal and corporate tax rates
• Attractive to crypto miners
• No VAT on crypto transactions
• Favorable residency rules for digital nomads

Considerations

While Georgia is very friendly to crypto investors, those considering relocating should still ensure they comply with tax laws in their home countries. Many countries, including the U.S., tax global income, so it's important to plan accordingly and consult with tax experts.

Georgia is considered one of the best tax havens for crypto investors, thanks to its favorable tax policies, low corporate tax rates, and absence of taxes on crypto gains. It’s an increasingly popular destination for crypto entrepreneurs, traders, and digital nomads due to its business-friendly climate and growing crypto ecosystem. However, like any international move, it’s important to ensure compliance with local tax laws and consider your tax obligations in your home country.

Author: Oksana Iashagyan

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