Renting to a tenant is taxed at 5%; renting to a company at 20%

Both sources are explicit that the residential 5% applies to the full rent received, with no deduction for expenses. That is simple, but it is not automatically the cheaper option. If a flat is let for a modest rent and carries real costs, agency fees, repairs, furnishing, a service charge, 5% of gross can work out as a higher share of actual profit than 20% of a figure that has had those costs taken off first. The arithmetic depends on how expensive the property is to run, which is why the flat rate suits a low-maintenance let best.

One of the two sources draws a further distinction that matters in practice. If you let as a private person to a business, the renting business withholds and declares the tax on your behalf. If you are registered as an individual entrepreneur, you declare and pay the 20% yourself. For the 5% residential route, the obligation sits with the owner. The same page gives 1 April as the annual deadline for income tax on rental or sale income, so a letting that began this year is reported next spring, not now.

Both sources say a property owned for more than two years can be sold with no tax on the gain. Sell inside two years and the gain is taxed, at 5% for residential property and 20% for commercial, on the difference between sale price and purchase price. For an owner currently weighing whether to sell or rent, this is the single rule most likely to change the answer: if the two-year mark is close, waiting for it can be worth more than any rent collected in the interim. Confirm your own purchase date against the registry entry rather than the contract.

These are advisory firms summarising the tax code, not the code itself, and the two pages do not agree on everything. On annual property tax, one gives a flat 1% of owner-declared market value with exemption below 40,000 GEL of household income; the other gives bands of 0.05% to 0.2% between 40,000 and 100,000 GEL and 0.8% to 1% above 100,000 GEL. They also differ on filing dates. Where sources this close together diverge, the safe step is to put your own numbers in front of a Georgian tax adviser or the Revenue Service before you sign anything.