---
title: "Real Estate Investment Funds"
url: "https://legal.ge/en/service/real-estate-law-en/real-estate-investment-funds-en"
field: "Real Estate Law"
description: "Taxation of real estate investment funds in Georgia: profit, dividends, exemptions and property tax. Legal assistance from Legal.ge."
reviewed: "2026-07-09"
updated: "2026-11-05"
publisher: "legal.ge"
---

# Real Estate Investment Funds

> Source: legal.ge, https://legal.ge/en/service/real-estate-law-en/real-estate-investment-funds-en

## The Tax Form and Status of an Investment Fund

The Tax Code determines the foundations of the tax regime of an investment fund. An investment fund is an enterprise founded, in accordance with the Law of Georgia on Investment Funds, in the form of a joint investment fund or an investment company. Under the same law, the activity connected with the management and administration of a fund, and the provision of depository services to it, is treated as a financial service. For funds investing in real estate this means that the choice of the form of the fund and the tax qualification of its services are defined from the outset, and tax planning must be built within this framework. It is also essential that each sub-fund of an umbrella fund is treated for the purposes of this regime as an independent investment fund, which creates additional flexibility in structuring.

## Profit, Loss and Reporting of a Joint Fund

The profit and loss of a joint investment fund are treated as profit and loss of each unit holder outside the fund, in proportion to the value of the unit in his or her ownership. The loss attributed to a unit holder must not exceed the amount of his or her contribution to the fund and the expenses and commission paid to the asset management company. The management company is obliged to open for each unit holder an investment account, in the manner established by a joint order of the Ministry of Finance and the National Bank, and to keep the record of his or her profit and loss. The excess income received upon the sale or redemption of a unit is reduced by the amount taken into account in the same holder's taxable income on the basis of the loss calculation. Unit holders conduct their tax reporting independently, and neither the fund nor the asset management company is charged with the respective tax agent obligation. Activity carried out by or in the name of a unit holder in accordance with the law does not create a permanent establishment in Georgia.

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### In what form does an investment fund exist?

As a joint investment fund or an investment company under the Law on Investment Funds; a sub-fund of an umbrella fund is treated as an independent fund.

### How is the profit and loss of a joint fund allocated?

Proportionally to the unit holders; the loss of a holder does not exceed his or her contribution and the expenses and commission paid to the management company.

### At what rate are dividends and excess income taxed?

At 15 percent, and at 5 percent where the fund invests only in bank deposits and-or financial instruments.

### How is the object of property tax determined?

By the fixed and investment property on the balance of the enterprise, construction in progress and property leased out.