Registering an IT company in Georgia is never really one decision. It is two, made separately and often in the wrong order: which legal structure to register, and which tax status to apply for on top of it. A solo developer, a five-person agency and a twenty-person product company answer both questions differently, and the guides that treat "IT company registration" as a single checklist tend to steer everyone toward the same answer regardless of which of those three they actually are. Here is how the decision actually breaks down, including the two questions that decide more of the outcome than the registry ever will: whether your revenue is genuinely software income, and whether you are an agency or a product business.
Two decisions, not one
Most guides to registering a tech business in Georgia collapse the whole thing into a single question: IE or LLC. That question matters, but it is not actually the one that decides your tax bill. Georgia layers a tax status on top of the legal structure, and the structure only determines which statuses are even available to you.
An Individual Entrepreneur can hold Small Business Status, the 1% turnover regime, and nothing else preferential. An LLC cannot access the 1% rate at any size, but it opens the door to Virtual Zone and, eventually, International Company Status, neither of which an IE can hold. Get the structure wrong at the start and you have not just picked the wrong entity, you have ruled out every preferential IT-specific rate before you knew you needed one.
Solo developer or a very small team: start with the IE
If you are one person, or two founders each invoicing individually, writing software for clients abroad and expecting to stay under 500,000 GEL of annual turnover, the honest starting point is an Individual Entrepreneur with Small Business Status. One percent of turnover, with no expense deductions and no distinction between "software income" and any other kind, is close to unbeatable for a high-margin solo service business, and it avoids the whole Virtual Zone eligibility question entirely because it does not depend on what kind of income you earn, only on how much.
This is also the fastest and cheapest way to start trading while you decide what the business actually is. Registration is a single business day and 26 GEL, rising to 75 GEL for same-day processing. The moment you need a co-founder with real equity, staff on payroll, or a genuine software product the company itself owns rather than a stream of personal invoices, the calculation changes and an LLC becomes the actual question.
Once you need an LLC: what changes for an IT company specifically
Registering an LLC for a software business follows the same process as any other Georgian LLC: a charter, founders and a director, a registered legal address, and a state fee of 200 GEL standard or 400 GEL same-day, confirmed on NAPR's own fee schedule. Nothing about being a tech company changes the registry step itself.
We handle the registration itself, activity-code selection included, as part of LLC registration. What does change is worth deciding before you file rather than after. The activity codes you register under, and how the charter describes what the company does, shape which preferential regime you can later apply for. A company registered with a vague "consulting services" activity code has a harder time demonstrating it produces software than one that states its actual development activity plainly from day one. If Virtual Zone or International Company Status is even a possibility for the business, it is worth having that conversation before the charter is filed, not after the certificate is in hand.
Virtual Zone and International Company Status, briefly
Once an LLC exists, two IT-specific preferential regimes sit on top of it, and they are genuinely different from each other rather than two versions of the same thing.
Virtual Zone status gives 0% corporate tax on profit from IT products the company created and sold to clients outside Georgia, with no minimum trading history and no headcount requirement. International Company Status gives 5% profit tax, 5% payroll tax and 0% dividend tax, but only to a company with at least two years of documented experience and real local substance already established. A new company has exactly one of these available to it; an established one gets to choose based on which package actually suits how it uses its profit. The full comparison, including a decision table by company stage, lives in Georgia's tax regime comparison.
SaaS revenue: where the line actually sits
Subscription software income is the category that causes the most confusion, because "SaaS" describes a billing model, not a tax category, and the two get conflated constantly.
A subscription fee for software the Georgian entity genuinely built and continues to maintain, sold to clients outside Georgia, sits cleanly inside Virtual Zone's 0% rate, defined under the Law of Georgia on Information Technology Zones as the study, support, development, design, production and introduction of computer information systems resulting in a software product. The subscription structure itself is not the issue. What the Revenue Service actually looks at is whether the underlying product is the company's own output: is there a real codebase, a development history, a team that can be shown to have built the thing being billed for.
Where it gets genuinely harder is a business that is mostly reselling or supporting a platform built elsewhere and charging a recurring fee for that access. Billing support, hosting, and account management for someone else's software as a monthly subscription looks identical to genuine SaaS income on an invoice, and identical in a bank statement, but it is a service riding on top of another company's product rather than the company's own IT output. That distinction decides whether the income qualifies at all, and no amount of careful invoice wording changes what is actually happening underneath it.
Two companies can send an identical-looking monthly subscription invoice to an identical client abroad. One qualifies for Virtual Zone's 0% rate and one does not, and the difference has nothing to do with the invoice itself. What decides it is whether the Georgian entity actually built and maintains the software being billed for, or whether it is charging a recurring fee for supporting or reselling something built somewhere else.
Agencies versus product businesses: a different qualification question
This is the distinction most guides skip entirely, and it matters as much as the SaaS question, because a development agency and a product company sit in genuinely different positions under the same law.
A product business owns a piece of software outright, whether it sells licences, subscriptions, or one-off copies, and its qualification question is largely the SaaS question above: did this company build the thing it is selling. This is the cleanest fit for Virtual Zone, because the software product the law asks about is unambiguously the company's own.
An agency doing genuine custom development work for clients abroad is producing software too, in the plain sense of the word, even though the resulting product typically belongs to the client rather than the agency once delivered. Georgia's IT activity definition covers the development, design and production of computer information systems resulting in a software product, and custom development work fits that description on its face, whatever happens to ownership of the finished product afterward. An agency genuinely writing code for a foreign client, invoicing for delivered software rather than for headcount, is a reasonable fit for the same regime a product company uses.
Where an agency's position weakens is the closer it sits to staffing rather than production. A business that places its developers under a foreign company's direct day-to-day management, invoices essentially for hours or headcount rather than delivered software, and has limited independent control over what gets built, looks considerably more like outstaffing than IT production. That is a materially harder case to argue under Virtual Zone's narrow activity definition, and it sits closer to the kind of support and consulting work the law does not comfortably reach. It may still fit better under International Company Status once the two-year bar is cleared, since that regime's permitted activity list explicitly includes computer programming and consulting rather than production alone.
The practical rule: the more a business looks like it delivers finished software and controls how that software gets built, the stronger its position under Virtual Zone. The more it looks like it supplies people's time under someone else's direction, the weaker that position becomes, and the more worth checking before applying rather than after.
Which status actually fits at which scale
Putting the structure and the status questions together, the honest answer changes at least three times between a first invoice and a real company.
Pre-revenue or a very small solo operation, testing an idea. Micro Business Status if turnover stays under 30,000 GEL and there are no hires, otherwise Small Business Status once real invoicing starts.
A solo developer or two-person team with real turnover, exporting services, under 500,000 GEL. An Individual Entrepreneur with Small Business Status. The 1% rate on turnover is close to unbeatable at this scale, and there is no reason to take on an LLC's extra compliance before the business actually needs one.
A product company or agency past the 500,000 GEL cap, or one that needs an LLC for liability, staff or investment reasons, with genuine export revenue and no long history yet. Virtual Zone. It is the only realistic preferential option at this stage, since International Company Status is not available without two years behind you.
An established company, at least two years in, broader service mix than pure software production, real local staff, planning to distribute profit rather than reinvest all of it. International Company Status becomes genuinely worth comparing against staying on Virtual Zone, particularly for the 0% dividend treatment and the 5% wage tax on staff that Virtual Zone does not offer at all.
Where a genuinely innovative product or an R&D-heavy business sits at any of these stages, a separate innovation framework introduced through 2025 sits alongside all three regimes above, though it cannot be combined with either Virtual Zone or International Company Status. It is new enough that the exact tiered relief schedule is worth confirming directly rather than taken from a single source, and we cover the general shape of it in Georgia's tax regime comparison.
Getting banked and getting paid
An IT company built around foreign clients runs into the payments question early, and it is worth planning for before the certificate exists rather than after. Georgia is not a supported Stripe country, which surprises almost everyone coming from a Western market, and the workable alternatives, a merchant-of-record platform, Wise, or a direct SWIFT transfer, each carry their own cost and setup, covered fully in payment processors for a Georgian company.
The Georgian business bank account itself is a separate step again, and the compliance interview goes considerably better for an IT company that can describe its actual client mix specifically: who pays, from where, how much, and why the money is routed through Georgia. "Software development for agencies in the US and Germany, paid by wire, 10,000 to 20,000 GEL a month" is the kind of answer that clears a branch appointment quickly. A vague description of "international services" is the kind that stalls one.
We register the LLC, choose activity codes that actually support a Virtual Zone or International Company application later, and prepare the substance evidence before the Revenue Service ever asks for it.
See what it costs
What stays the same regardless of structure or status
Whatever combination applies, the ordinary obligations run underneath all of it. VAT registration is mandatory once non-exempt turnover passes 100,000 GEL in a rolling 12 months, at 18%, and reverse VAT can apply to foreign software subscriptions and contractor payments even below that threshold. Every registered business, IE or LLC, under any status, files monthly with the Revenue Service by the 15th, including in months with no income. None of the preferential rates above touch your own personal tax residency question either, which is a separate matter our Georgian tax residency guide covers on its own terms.
Key takeaways
- Settle the legal structure before anything else, since it decides which tax statuses are even reachable later, not just the registry fee.
- Choose activity codes that describe what the company actually builds if Virtual Zone or International Company Status is even a future possibility, rather than a generic catch-all code.
- Test your own SaaS revenue against who actually built the product before assuming it qualifies for 0%, not against how the invoice reads.
- Read your agency's contracts as either delivered software or supplied headcount before applying, since that distinction decides the outcome more than the activity description does.
- Reassess the status choice at each stage of growth rather than assuming the first one you registered under is the permanent answer.
- Plan for Stripe's absence and the bank's compliance interview before the certificate exists, not after the first client payment is due.
Frequently asked questions
Do I need an LLC to register an IT company in Georgia?
Not necessarily. A solo developer or very small team can register as an Individual Entrepreneur and access Small Business Status, the 1% turnover regime, which does not require an LLC. An LLC becomes necessary once you want Virtual Zone or International Company Status, since neither is available to an IE.
Can a small IT company get Georgia's 1% tax rate?
Yes, if it is an Individual Entrepreneur under 500,000 GEL of annual turnover and the activity is not on the excluded list. The 1% applies regardless of the type of software work, unlike Virtual Zone, which only exempts genuine IT production income specifically.
Does SaaS subscription income qualify for Virtual Zone's 0% rate?
Yes, where the Georgian entity genuinely built and maintains the software being billed for and sells it as a subscription to clients outside Georgia. It does not qualify where the business is mainly reselling or supporting a platform built elsewhere, however the invoice describes the fee.
Can a development agency qualify for Virtual Zone status?
Generally yes, where the agency is genuinely producing custom software for clients abroad rather than supplying staff under a client's direction. The closer the arrangement looks to outstaffing, developers managed day to day by the foreign client rather than delivering software the agency itself produced, the weaker the fit under Virtual Zone's narrow activity definition.
What is the difference between an agency and a product business for tax purposes?
A product business owns the software it sells outright, which is the cleanest fit for Virtual Zone. An agency typically delivers software the client then owns, which still generally counts as production under the law, though the closer the work resembles staffing rather than delivered output, the weaker that position becomes.
Which status should a growing IT company move to first?
Virtual Zone, once the business needs an LLC and has genuine export revenue, regardless of how long it has been trading. International Company Status only becomes available after two years of documented experience, so it is never the first preferential status a new company can hold.
How much does it cost to register an IT company in Georgia?
The registry fee is fixed regardless of the tax status you eventually pursue: 26 GEL standard or 75 GEL same-day for an Individual Entrepreneur, 200 GEL standard or 400 GEL same-day for an LLC. What varies is the professional cost of preparing a Virtual Zone or International Company application on top of the registration itself.
Can I take card payments from clients if I register a Georgian IT company?
Not through Stripe, since Georgia is not on its supported-country list. Workable alternatives include merchant-of-record platforms, Wise, and direct SWIFT transfers, each with different costs and setup, covered in full in our payment processors guide.
Does it matter which activity codes I register under?
Yes. The activity codes and the charter's description of what the company does are what a later Virtual Zone or International Company application gets checked against. Registering under a vague or mismatched activity code makes it harder to demonstrate the company genuinely produces software when the time comes to apply.
Can an IT company hold Virtual Zone and Small Business Status at the same time?
No. Small Business Status is only available to an Individual Entrepreneur, and Virtual Zone requires an LLC. A business moving from one to the other is registering a new entity and transitioning the business across, not adding a second status to the same registration.
What happens if my IT company earns some export revenue and some Georgian client revenue?
Under Virtual Zone, only the exported IT income qualifies for 0%; Georgian-client revenue is taxed under the standard rules. The company needs to track and report the two separately, since applying one rate to blended revenue is not how either regime works.