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Global Payroll Team
Written by Global Payroll Team
Last updated May 7, 2026
Expert Reviewed
Payroll in Georgia
Tax in Georgia
Immigration in Georgia

Georgia map

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Mercans offers complete payroll, PEO and HR services in Georgia

Known as one of the oldest wine regions in the world, Georgia, or Sakartvelo, is geographically well positioned as a gateway between Europe and Asia. With multiple free trade agreements, competitive operating costs and a market-oriented economic policy, Georgia continues to support investment across sectors such as logistics, technology, tourism, manufacturing and business services.

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Doing Business in Georgia

Georgia continues to position itself as a business-friendly investment destination with streamlined incorporation procedures, attractive tax rates and lower operating costs than many European markets. Key sectors include business process outsourcing, electronics, hospitality and real estate, energy, logistics and advanced manufacturing, supported by a skilled workforce and continued infrastructure development.

Entity Registration and Incorporation Requirements

Setting up a new business or expanding an existing one in Georgia is straightforward. Choose how your company operates from a range of entity types which suit your individual circumstance.

Banking

Banking Hours: 9:30 am to 5:30 pm from Monday to Friday

Working Week

The standard working week is generally 40 hours, usually worked from Monday to Friday.

Labor Law

The main sources of employment law in Georgia are the Constitution, the Labor Code, the Civil Code and the Law of Georgia on Occupational Safety. A core principle of the Labor Code is the prohibition of discrimination, which applies both during employment and at the pre-contractual stage.

Main Industries

Steel, machine tools, electrical appliances, mining, chemicals, wood products, wine, logistics and tourism

GDP Growth

9.4%

Dates & Numbers

dd/mm/yyyy

Official State Name

Georgia

Population

3.94 million

Capital

Tbilisi

Major Languages

Georgian

Currency

Georgian lari (GEL)

Internet Domain

.ge

International Dialing Code

+995

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Georgia
Tbilisi, GE
8:14 pm, May 14, 2026
temperature icon 22°C
scattered clouds
56 %
Wind Gust: 0 mph
Clouds: 40%
Sunrise: 5:42 am
Sunset: 8:11 pm

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Payroll

The applicable laws relating to payroll are the Tax Code of Georgia and the Labor Code of Georgia. The Law of Georgia on Public Service regulates employment issues related to public servants. Remuneration is generally paid once a month and is taxed through monthly payroll withholding.

It is acceptable to provide employees with online payslips

Payslip

Payroll reports must be kept for 6 years

Reports

Employees are entitled to 24 working days of paid annual leave

Annual Leave

Sick leave is generally governed by the employment agreement or employer policy, as the Labor Code does not prescribe a universal statutory paid sick leave period

Sick Leave

126 calendar days of paid maternity leave, or 143 calendar days in the event of complications during childbirth or the birth of twins

Maternity & Paternity Leave

30 days notice

Employee Termination

This is not compulsory but can be paid as a bonus based on performance

13th month salary

There is no generally applied national minimum wage for private sector employees

Minimum Wage

Overtime is paid at an increased hourly rate agreed between the parties. The Labor Code does not set a fixed statutory multiplier

Overtime

The employee is entitled to at least 1 month salary pay in qualifying employer-initiated termination cases

Severance Pay

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Tax and Social Security

Resident individuals are generally exempt from tax on income that is not derived from a Georgian source. Personal income is generally subject to a flat tax rate of 20%. Georgia does not operate traditional social security contributions like many European jurisdictions, but it does have a mandatory funded pension scheme for covered employees.

Tax

There is also a special tax regime whereby individuals with annual turnover below the legal threshold, no employees, and registration as a micro business may be exempt from tax on business income. Georgia continues to apply a 15% corporate income tax rate and an 18% VAT rate.

15%

Corporate Income Tax

20%

Personal Income Tax

18%

Sales Tax

18%

VAT

Social Security

Georgia does not have broad social security payroll contributions, but from 2019 a funded pension scheme became mandatory for most covered employees. In general, the pension contribution is financed by the employer, the employee and the State.

4% + share

Social Security Rate

2%

Social Security Rate for Employers

2%

Social Security Rate for Employees

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Employment Law

The underlying principle of the Labor Code is that the employment contract must not place an employee in a worse position than the minimum standards established by the Code.

Employment Agreement

Generally, employment contracts must be in writing. However, an employment contract may be oral if the relationship does not exceed one month. Minimum terms include the start date, working and rest time, position and type of work, compensation and payment method, paid and unpaid leave, and the procedure for overtime compensation.

Working condition

As a rule, working time may not exceed 40 hours per week, excluding breaks and rest time. Exceptions may apply where an enterprise has specific operating conditions requiring more than eight hours of uninterrupted production or work.

Leaves

Employees are entitled to at least 24 working days of paid leave and 15 calendar days of unpaid leave annually. An employee is also entitled to maternity and parental leave, which is compensated from the state budget within the statutory limits.

Employment termination

The Code provides an exhaustive list of grounds on which an employment contract may be terminated, including economic circumstances, expiry of the employment term, voluntary resignation, written mutual agreement and gross violation of obligations by the employee. Advance notice does not apply in all cases, but in certain employer-initiated cases the employer must provide at least 30 days’ written notice and severance of at least one month’s salary.

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30 days

Minimum notice period for terminating an employee

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17 days

Total number of public holidays

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40

Working hours per week

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Not specified

Total number of days for Compassionate & Bereavement Leave

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Immigration

A work residence permit is issued to individuals coming to Georgia for labor or entrepreneurial activities. A residence permit authorizes a foreign citizen to enter and stay in Georgia, and the application is generally made to the Public Service Development Agency or through an authorized representative.

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Residency permits

A residence permit is issued by the Public Service Development Agency once all required documentation has been submitted and reviewed. There are several residence permit categories, including work residence permit, study residence permit, permanent residence permit, investment residence permit, temporary residence permit and more.

Work Permit validity

Usually 6 months to 1 year initially, extendable in accordance with the law

Required Documents

Approved and signed residence permit application form

Copy of a valid passport or travel document

Copy of a document evidencing lawful stay in Georgia

Employment contract or proof of labor immigrant registration, or documents confirming entrepreneurial activity in Georgia

Document confirming income or other lawful means where required

Proof of payment of the state fee

Compliant, reliable, error-free and touchless payroll in Georgia

Build the best team and hire top talent compliantly in Georgia. Get in touch with Georgia payroll outsourcing & PEO specialists for a free consultation!

This document was prepared for informational purposes only. As local laws & regulations keeps on changing. Please consult your tax & legal advisors as well.
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    FAQs

    What is an Employer of Record (EOR) in Georgia and how does it help foreign companies?

    An Employer of Record in Georgia acts as the legal employer for staff on behalf of foreign companies. It takes care of employment contracts, payroll, taxes, social contributions, and compliance with Georgian labour laws so that the foreign company can hire locally without setting up its own entity.

    Why should businesses use an EOR instead of setting up a local entity in Georgia?

    Using an EOR removes the need to register a local subsidiary, opens up fast access to the Georgian market, lowers upfront costs, reduces administration, and ensures compliance with employment and tax regulations from day one.

    How does payroll outsourcing in Georgia ensure compliance with tax and labor regulations?

    Payroll outsourcing in Georgia ensures that salaries are processed correctly, tax withholdings and pension contributions are properly calculated, and required filings are completed under Georgian law. This helps prevent compliance failures and legal risks.

    Can an Employer of Record in Georgia hire employees and manage work permits for international companies?

    Yes. An EOR in Georgia can recruit and hire employees on behalf of a foreign company and handle immigration aspects, such as work and residence permits for non-local staff, as part of the employment management.

    What are the key benefits of using EOR and payroll services in Georgia for global expansion?

    Key benefits include rapid market entry, full local compliance, reduced administrative burden and employment risk, access to local expertise in payroll and labour regulation, and the flexibility to scale operations in Georgia while your company focuses on its core business.

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