Double Taxation Relief is a fundamental mechanism in the financial planning of international businesses and individuals. This service addresses situations where the same income or capital is potentially taxed in two different jurisdictions. Georgia has signed Double Taxation Avoidance Treaties (DTTs) with over 58 countries. These treaties determine which country has the primary right to tax and at what rate. However, the practical application of these benefits is not automatic. The taxpayer must prove their residency and fulfill administrative requirements. Incorrectly processed documentation can lead to paying tax in both countries, significantly reducing net income. Our platform allows you to find specialists who will help you navigate these complex procedures.
The service includes comprehensive legal and tax assistance at all stages of applying a DTT:
- DTT Analysis: Interpreting the provisions of the treaty with a specific country and tailoring them to the client's situation (dividends, interest, royalties, employment income).
- Obtaining Tax Residency Certificate: Securing a document proving residency from the Revenue Service of Georgia or a foreign tax authority.
- Applying the Credit Method: Crediting tax paid abroad against the tax payable in Georgia.
- Applying the Exemption Method: Fully exempting income from taxation in one jurisdiction based on the treaty.
- Refund of Overpaid Tax: Initiating procedures to reclaim tax over-withheld in a foreign country or Georgia.
- Permanent Establishment Determination: Analyzing whether activities create a taxable presence in the other country.
This service is essential in various scenarios. For example, a Georgian resident individual works remotely for a German company. They need to ensure that tax is not withheld from their salary in Germany, or if it is, that they can credit it in Georgia. Another case is a Georgian company receiving dividends from a subsidiary in the Netherlands; using the DTT allows reducing the tax to 0% or 5%. Also common are cases of foreign investors with deposits in Georgian banks who wish to benefit from reduced tax on interest income. In all these instances, precise adherence to formal procedures is required.
Legal regulation relies on the Tax Code of Georgia (Articles 134, 104) and International Agreements on the Avoidance of Double Taxation. DTTs have superior legal force over domestic legislation (in accordance with the Constitution of Georgia). Additionally, the Order of the Minister of Finance "On Tax Administration" is important, as it defines the forms of residency certificates and rules for their submission. Specifically, foreign documents often require apostille certification or legalization, which is also part of this service.
The process begins with identifying the situation: what type of income it is and between which countries the transaction occurs. The specialist determines which article applies in the specific treaty. Then, documents are collected: residency certificate, proof of income, and tax payment receipts (if already paid). Following this, an application is submitted to the tax authority (or to the payer, if it is a preliminary exemption). The specialist ensures communication with tax inspectors and defends the client's interests in case of disputes.
Legal.ge is your reliable partner in the international tax maze. Double taxation relief is not just theory — it is real money you can save with qualified assistance. Experts registered on our platform possess deep knowledge of international tax law and will help protect your rights. Do not pay more than you owe — find a specialist on Legal.ge.
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