Find out what steps are required to set up an LLC in Georgia and what documents are needed.
Why Georgia is an attractive location for business start-ups
Georgia offers a number of advantages for company founders. These include a favourable tax system, a stable political and economic situation and a growing market economy. In addition, the country has a strategically favourable location between Europe and Asia, which facilitates access to markets in both regions. Georgia has also established itself as a country with little bureaucracy and an efficient business environment, making it easier to set up and operate a business. These factors make Georgia an attractive location for business start-ups.
Georgia also offers a modern and well-developed infrastructure network that facilitates transport and trade. Overall, Georgia offers a promising environment for starting and developing a business.
Steps to set up an LLC in Georgia
Forming an LLC (limited liability company) in Georgia requires the following steps:
1. Choosing a company name: Choose a unique company name that is not already in use by another company.
2. Registering the company: apply to register your LLC with the Georgian Commercial Register.
3. Set up a bank account: Open a bank account for your company to be able to process financial transactions.
4. Obtain the necessary permits and licences: Check whether your company needs any special permits or licences to carry out certain business activities.
5. Register with the tax authorities: Register your company with the Georgian tax authorities.
6. Drawing up a memorandum of association: draw up a memorandum of association that sets out the legal framework for your LLC.
7. Opening a business address: Make sure you have a business address in Georgia where your company is registered.
8. Obtaining an electronic signature: Apply for an electronic signature, which is required for communication with the Georgian authorities. (Optional)
After completing these steps, you can officially incorporate your company in Georgia and start your business activities.
Documents required for opening an LLC
To open an LLC in Georgia, the following documents are required:
- Company application: An application for registration of the LLC with the Georgian Commercial Register.
- Copy of the founder's identity card or passport: A copy of the valid identity card or passport of the founder of the LLC.
- Memorandum of Association: A legally valid Memorandum of Association that sets out the legal framework for the LLC.
- Proof of business address: A proof of business address in Georgia where the company is registered.
It is important that all required documents are submitted completely and correctly to avoid delays or problems with the formation of the LLC.
Tax aspects of setting up a company in Georgia
There are various tax aspects to consider when setting up a company in Georgia:
- Corporate taxes: Georgia has a standardised corporate tax rate of 15% on the company's profits.
- VAT: The standard rate of VAT in Georgia is 18% on the sale of goods and services.
- Income tax: Income tax in Georgia is 20% for individuals and companies.
- Social security contributions: Employers and employees must pay social security contributions, which are graduated according to income.
It is important to pay close attention to the tax regulations in Georgia and, if necessary, consult a tax advisor to ensure that the company fulfils all tax obligations.
Advantages of LLC formation in Georgia
Forming an LLC in Georgia offers a number of advantages:
- Limited liability: As an LLC, you are only liable with the company's assets and not with your personal assets.
- Favourable tax system: Georgia has an attractive tax system with low tax rates and various tax benefits for companies.
- Simple formation processes: The formation process for an LLC in Georgia is relatively simple and straightforward.
- Access to markets: Due to Georgia's geographical location, companies have access to markets in Europe and Asia.
- Low labour costs: Georgia offers a skilled workforce at low labour costs, which lowers operating costs.
These advantages make setting up an LLC in Georgia an attractive option for entrepreneurs looking to start or expand a business.