The 5% rate on residential rent comes with one condition landlords keep missing: no deductions

On PwC's reading of the Georgian rules, reviewed at the start of September 2026, personal income tax at 5% applies to rental income where an individual lets residential space for residential use, whether the tenant is a person or an organisation. The condition attached is the part that decides most cases: the 5% rate is available only if the individual claims no deductions against that rental income. In other words it is a flat charge on gross rent, not a reduced rate on profit. A landlord who wants to deduct repairs, agency fees, utilities or interest is choosing the ordinary basis instead.

In practice the 5% treatment runs through registration with the Revenue Service at rs.ge; without it the standard 20% applies. Annual income tax returns for the previous year are due by 1 April. Two distinctions are worth pinning down with an adviser before you rely on either rate: whether the letting is genuinely residential use, which is what the rule turns on, and how short-stay hosting is classified — the secondary guidance treats short-stay as business activity rather than residential rental, which is a different tax position altogether. If you let both long and short in the same year, do not assume one rate covers both.

PwC also describes a fixed personal income tax rate that was available for income from holiday and other short-stay accommodation, open to individuals who applied to the tax office, were not voluntarily registered for VAT, and kept income from that activity at or below 100,000 lari in any rolling twelve months. As PwC sets it out, that regime ran from 1 January 2023 until 1 January 2026 — so the window has closed. If your bookkeeping still assumes it, that is worth correcting now rather than at the April filing. Figures and classifications here change: confirm your own position with the Revenue Service or a Georgian tax adviser before acting on any of this.