Tax planning involving CIS (Commonwealth of Independent States) countries is a specialized service focused on doing business in Georgia within the context of economic ties with post-Soviet nations (Russia, Ukraine, Kazakhstan, Belarus, Armenia, etc.). Due to historical and economic factors, Georgia has close trade relations with this region. However, in light of recent geopolitical changes and sanctions, this area requires particular caution and specific knowledge. Georgia is often used as an alternative hub for business relocation from the CIS or as an intermediary in international trade. In this context, detailed knowledge of both the Georgian Tax Code and bilateral treaties with CIS countries is critically important to avoid double taxation, currency risks, and regulatory hurdles.
This service includes specific tax and legal solutions:
- Business Relocation from CIS: Moving companies and assets to Georgia, analyzing tax consequences in both outgoing and incoming jurisdictions.
- Specific DTT Analysis: Utilizing tax treaties between Georgia and CIS countries (which often differ from European models).
- Currency Control Issues: Consulting on strict currency regulations in CIS countries and leveraging the advantages of Georgia's liberal regime.
- Structuring Transit Trade: Establishing a trading company in Georgia for operations between the CIS and the West.
- Individual Migration: Obtaining Georgian tax residency for CIS citizens and protecting their foreign income.
- Sanctions Compliance: Tax planning considering international sanctions regimes.
In practice, this service is relevant in many directions. For example, a Kazakh company opens a subsidiary in Georgia to benefit from the free trade regime with the EU. In this case, dividend taxation optimization between the two countries is needed. In another case, a Russian IT specialist moves to Georgia, registers as an Individual Entrepreneur, and works for Western clients; they need advice on how to avoid maintaining residency in Russia and paying taxes there. Also, a Ukrainian business temporarily moving operations to Georgia requires quick tax registration and assistance in dealing with local banks.
The legal framework includes the Tax Code of Georgia and bilateral agreements. Georgia has Double Taxation Avoidance Treaties with almost all CIS countries (Armenia, Azerbaijan, Kazakhstan, Ukraine, Uzbekistan, Turkmenistan). It is noteworthy that the treaty with Russia was suspended by Russia in 2023 regarding certain articles, creating a new legal reality and requiring updated strategies. Also important is the Law of Georgia "On Occupied Territories," which must be considered during certain transactions.
The process begins with a study of the client's existing structure and residency status. The specialist analyzes the specific bilateral treaty (e.g., Georgia-Kazakhstan) and determines the optimal tax burden. In case of relocation, an action plan is developed, including company registration, opening bank accounts, and tax registration. Where there is a risk of sanctions, an additional compliance check is conducted to ensure smooth transaction execution within the Georgian banking system.
Legal.ge offers access to specialists who deeply understand the specifics of the post-Soviet space and Georgia's role in this region. Through our platform, you will connect with lawyers who can bridge the bureaucratic reality of CIS countries with Georgia's liberal and flexible system. Protect your business from geopolitical and tax risks with Legal.ge experts.
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