Georgia has implemented Value Added Tax obligation on non-resident providers of digital or electronic, broadcast and telecommunications services from 1 October 2021. It was delayed from 1 July 2021. This follows the example of the European Union and OECD recommendations. In addition to digital services, providers of telecommunications (voice and data) and broadcast services are also including in the VAT obligations. There is no VAT registration threshold for selling digital goods into Georgia.
The Georgina Revenue Service is expected providers to complete a simplified registration process. Once completed, the provider may complete simplified reporting with no ability to recover any local VAT. Supplies to VAT registered resident
What digital services are liable to Georgian VAT?
The Revenue Service has highlighted that income from the following electronic services delivered over the internet or similar electronic network to consumer will be subject to VAT:
- telecoms services, voice and data
- broadcast services, TV and radio
- videos, music,
- games or other analogues, through download, streaming or other technology,
- magazines, newspapers and books.
Determining the place of supply for VAT
The new rules require the provider to determine if the consumer is resident in Georgia, and the place of supply is within the jurisdiction of Georgian VAT net. Example of customer provided evidence to use for this determination include:
- Home address
- Bank account details
- Country code on telephone number
- IP address
VAT returns requirements
Once VAT registered via a simple online form, non-residents must complete VAT returns each quarter. These are due with the Revenue Service by 20th of the following month. The corresponding VAT liability is not due until the last day of the following month. VAT may be settled in local GEL currency, USD or Euro’s.
Europe VAT on digital services
|Country (click for details)||Rate||Date||Threshold||Comments|
|EU 27 member states||17% to 27%||Jan 2015||€10k EU residents; Nil for non-EU|
|Bosnia Herzegovina||17%||Jan 2023||BAM 50.000|
|Iceland||24%||Nov 2011||ISK 2 million|
|Norway||25%||Jul 2011||NOK 50,000|
|Russia||16.67%||Jan 2017||Nil||B2C & B2B|
|Switzerland||7.7%||Jan 2010||CHF 100,000 on global income|
|Ukraine||20%||Jan 2022||UAH 1m|