Taxes and Additional Costs on Property in Georgia

Buyers often hear that registering property in Georgia is simple and inexpensive. That is indeed one of the market's advantages, but a simple procedure doesn't mean there are no costs or tax obligations at all.

Purchase, ownership, earning income and a later sale should each be looked at separately. The amount depends on the type of property, the owner's legal status, family income, how the property is used, and the terms of the specific deal.

Is there a tax directly on buying an apartment

For an ordinary apartment purchase by an individual in Georgia, there is generally no separate universal tax charged as a percentage of the deal price. The main mandatory state expense is related to registering the ownership right, or the corresponding obligation, in the Public Registry.

The official fee for registering a property right is 150 GEL for four business days, 270 GEL for one business day, or 350 GEL for same-day processing. Additional services may be charged separately.

What extra costs arise during the paperwork

Depending on the deal, the buyer may need document translation, interpreter services, a power of attorney, apostille or legalisation, a bank transfer, a property valuation, legal due diligence and notarial actions. When buying from a developer, assignment fees or contract amendment fees may also apply.

Before signing, it's important to get a written breakdown of all payments: state fees, bank charges, specialist services, utility connections, complex maintenance, renovation, furniture and appliances.

Annual property tax

For individuals, property tax depends on the family's total income for the previous year and on whether there is taxable property. Under the current Tax Code, property other than land is exempt from tax if family income does not exceed GEL 40,000.

For income between GEL 40,000 and 100,000, the rate is set within a range of 0.05% to 0.2% of the market value of the taxable property. For family income above GEL 100,000, the range is 0.8% to 1%. The specific rate and calculation procedure need to be checked, taking into account the municipality and the owner's status.

Separate rules apply to land, so the income-based exemption cannot automatically be applied to any given plot.

Tax on income from an apartment

Income from using a property can create a registration and tax payment obligation. For renting out residential premises for residential purposes, the Tax Code provides for a 5% rate, subject to established conditions and without applying deductions.

Short-term rentals, hotel-type apartments, commercial use and activity through a company may be subject to a different regime. Before starting to earn income, it's necessary to clarify the rules with the Revenue Service or a tax consultant.

Tax on selling an apartment

For an individual, profit from selling a residential apartment or house is generally taxed at 5% if the property is sold before two years of ownership have passed. The tax is calculated on the positive difference between the confirmed sale price and the acquisition costs, not on the full deal amount.

When a residential apartment or house is sold after more than two years of ownership, the profit is usually exempt from tax. However, preliminary agreements, assignment of rights, hotel-type apartments, property used in economic activity, and systematic resale may be treated differently.

Before selling, it's important to check the legal classification of the property, the date the registered right arose, supporting costs, and the current guidance from the tax authority.

Costs of maintaining an apartment

After the purchase, the owner pays for building or complex maintenance, utilities, repairs, insurance where needed, and the upkeep of engineering systems. In projects with a pool, reception, security and a management company, the regular payment can be noticeably higher than in an ordinary residential building.

The maintenance fee should be found out before buying, along with whether the management company can change it, which services are included, and whether a mandatory management agreement exists.

How to calculate the full purchase budget

Add to the apartment price the registration, bank costs, document translation and verification, a possible commission, renovation, furniture, appliances, and maintenance payments before use begins. If the property is bought with a mortgage or instalment plan, interest, fees and currency risk should be accounted for separately.

Does a foreigner need to pay taxes in Georgia

Foreign citizenship in itself does not exempt the owner of Georgian property from local tax obligations. At the same time, tax residency, source of income, family income and ownership structure can affect the calculation. The individual situation needs to be checked separately.

How to avoid an unexpected payment

Keep contracts, bank confirmations, registration documents and proof of acquisition costs. Before buying, request a full breakdown, and before earning income or selling, get advice on the tax regime for the specific property.

AM Estate helps buyers gather information about a property, the registration terms and the complex's regular payments. Leave a request — we'll explain the structure of the deal and help you find a property that fits your budget.

This material is prepared for general information purposes and is not tax or legal advice. Rates, rules and official fees should be verified as of the date of the transaction with the Revenue Service, the Public Registry, or a qualified specialist.