From October 1, 2021

The Tax Code of Georgia, established that a taxable person, who is not established or has no habitual residence in Georgia, or has no fixed establishment in Georgia engaged in the supply of the digital services in Georgia, must pay Value Added Tax (VAT) as of October 1, 2021.

Who must pay VAT on Digital Services?

This tax obligation is only for foreign taxable persons, who are not established or have no habitual residence in Georgia, nor have a fixed establishment in Georgia, and who provide digital services to be used in the territory of Georgia by natural persons who are not taxpayers of VAT.

1. Electronically supplied services, which are delivered over the Internet or an electronic network and the nature of which renders their supply essentially automated and involving minimal human intervention, in particular, videos, music, games or other analogues, through download, streaming or other technology, including for these purposes, texts, magazines, newspapers and books. Annex№III-033

2. Those who supply Telecommunication services, relating to the transmission, emission or reception of signals, words, images and sounds or information of any nature by wire, radio, optical or other electromagnetic systems, including the related transfer or assignment of the right to use capacity for such transmission, emission or reception, with the inclusion of the provision of access to glob al information networks. Annex№III-031

3. Those who supply Broadcasting services, which shall include services consisting of audio and audiovisual content, such as radio or television programmes which are provided to the general public via communications networks by and under the editorial responsibility of a media service provider, for simultaneous listening or viewing, on the basis of a programme schedule. Annex№III-032

How the Filing and Payment will be (as of October 1, 2021)

The obligation to calculate and pay VAT

On transactions carried out after October 1, 2021

Accounting Period

Quarter

• I Quarter (From January 1 to 31 March) – starting from 2022 onwards
• II Quarter (From April 1 to June 30) – starting from 2022 onwards
• III Quarter (From July 1 to September 30) – starting from 2022 onward
• IV Quarter (From October 1 to December 31)

Deadline for filing Tax Return

No later than the 20 th day of the month following the accounting period (quarter)

Deadline for VAT Payment

No later than the last day of the month following the accounting period (quarter)

VAT Rate

18%

Payment Currency

• USD
• EURO
• GEL