Corporate tax in Georgia

Summary
Corporate Income Tax Rate (%) 15
Capital Gains Tax Rate (%) 15
Permanent Representation Tax Rate (%) 15
Withholding Tax (%)
Dividends
5
Interest 5
Royalties 5 *
Management Fees 10 *
Income from International Transport or International Communications 10 *
Income from Oil and Gas Operations 4 *
Payments of Other Georgia-Source Income 10 *
Branch Remittance Tax 0
Net Operating Losses (Years)
Carryback 0
Carryforward 5/10

* These withholding taxes apply to payments to foreign companies.

Taxes on corporate income and gains

Corporate income tax. Enterprises carrying on activities in Georgia, including enterprises with foreign investment, are subject to tax. Enterprises with foreign investment include 100% foreign-owned subsidiaries, joint ventures and foreign legal entities operating through a permanent representation (establishment).

Georgian legal entities (companies) are subject to tax on their worldwide in come. For tax purposes, Georgian legal entities are entities incorporated in Georgia, including 100%-owned subsid­iaries of foreign companies, and legal entities incorporated in a foreign country, but managed in Georgia.

Foreign legal entities are subject to tax on Georgian-source income only. Income earned through a permanent establishment in Georgia, net of tax-deductible expenses, is taxed at the regular corporate income tax rate of 15%. A permanent establishment is defined as any permanent location for business activities in Georgia and generally includes any organization or natural person who repre­sents a foreign legal entity conducting commercial activities in Georgia. Domestic tax law and double tax treaties list activities that do not result in a taxable permanent establishment. Foreign legal entities without a permanent establishment in Georgia are subject to with holding tax on their Georgian-source income at a rate of 4%, 5% or 10% (see Section A).

Georgian law allows foreign investment in various forms, includ­ing investment through wholly or partially foreign-owned subsid­iaries, share participations in joint stock companies and in joint ventures with Georgian legal entities and citizens, permanent establishments and other types of participations.

Tax rate. The regular corporate income tax rate is 15%.

Special types of enterprises. The Georgian tax law provides for beneficial tax treatment for enterprises operating in Georgia with the following statuses:

  • International Financial Company
  • Special Trade Company
  • Free Industrial Zone Company
  • Virtual Zone Person
  • Tourist Enterprise
  • Agricultural Cooperative

The Georgian Tax Authorities (GTA) grant the above statuses according to the rules defined by the Minister of Finance of Georgia. The statuses are described below.

International Financial Company. A financial institution may obtain the status of International Financial Company for the pur­pose of tax benefits if its Georgian-source income derived from financial operations or financial services does not exceed 10% of its worldwide gross income. Income received from financial op­erations and financial services between International Financial Companies is not considered to be income received from Geor­gian sources. An International Financial Company must be estab­lished outside a Free Industrial Zone. International Financial Companies are exempt from corporate income tax on income derived from financial operations, financial services and the sale of securities issued by nonresident persons.

Special Trade Company. An entity conducting its activities in an authorized warehouse may be granted Special Trade Company status for corporate income tax exemption purposes. A Special Trade Company may supply and re-export foreign goods, as well as purchase foreign goods from an entity without such status for further supply or re-export. A Special Trade Company may also derive income (including Georgian-source income) from other allowable activities if such income does not exceed the sum of GEL1 million and 5% of the customs value of foreign goods brought into Geor gia. In addition, a Special Trade Company may derive income ex empted from corporate income tax and from the sale of fixed assets used in economic activities for more than two years. A Special Trade Company is prohibited from import­ing or purchasing Georgian goods for further supply, rendering of services in Georgia and operating an authorized warehouse. The status of Special Trade Company is cancelled for a calendar year if an authorized representative of such company submits an application to the GTA at least five business days before the be­ginning of the relevant calendar year. A Special Trade Company is exempt from corporate income tax on income received from allow able activities except for income received from the sale of fixed assets.

Free Industrial Zone Company. Free Industrial Zone Company status for tax purposes may be granted to a company operating in a Free Industrial Zone. Free Industrial Zone Companies primarily engage in the manufacturing and export of goods outside Georgia from a Free Industrial Zone. The status of Free Industrial Zone Company is subject to cancellation if the company engages in activities prohibited by the law. Free Industrial Zone Companies are exempt from corporate income tax on income from activities allowed within a Free Industrial Zone.

Virtual Zone Person. Virtual Zone Person status for tax purposes may be granted to a company engaged in information technology activities. Virtual Zone Persons are exempt from corporate in come tax on income derived from the supply of self-produced informa­tion technology outside Georgia.

Tourist Enterprise. Tourist Enterprise status for tax purposes may be granted to a company that builds a hotel for the purpose of the sale and leaseback of the assets, or part of the assets, of the hotel and uses the building in hotel operations. Tourist Enterprises are exempt from corporate income tax on income derived from ren­dering of hotel services until 1 January 2026.

Agricultural Cooperative. Agricultural Cooperative status for tax purposes may be granted to a company in accordance with the Law of Georgia on “Agricultural Cooperative.” Agricultural Co­operatives are exempt from corporate income tax on income de­rived from the supply of agricultural products produced in Georgia before their processing (that is, a change of commodity code occurs) until 1 January 2017.

Capital gains. No separate capital gains tax is imposed in Georgia. Realized capital gains are included in taxable income and are subject to tax at the regular corporate income tax rate. Realized capital losses can be carried forward together with other losses and be offset against profit in future tax years (see Section C).

Administration. The tax year is the calendar year.

Both Georgian legal entities and foreign legal entities conducting business activities in Georgia through a permanent establishment must make advance payments of corporate income tax. Each pay­ment is equal to 25% of the corporate income tax liability for the preceding year. The due dates for the payments are 15 May, 15 July, 15 September and 15 December. Advance payments of tax are applied against the corporate income tax liability for the current tax year.

A taxpayer that had no taxable income during the preceding tax year does not have to make advance corporate income tax pay­ments during the current tax year.

If the total advance payments exceed the tax due for the tax year, the excess is applied against any outstanding liabilities for other taxes. If no outstanding tax liabilities exist, taxpayers may apply overpayments against future tax liabilities or ask for a refund.

The annual corporate income tax return must be filed and the balancing payment of corporate income tax must be made before 1 April of the year following the tax year.

Interest is charged on late tax payments at a rate of 0.05% of the tax due for each day of delay. If the tax return is not filed by the due date, a penalty is imposed. This penalty equals 5% of the amount of tax payable stated in the tax return for each complete or incomplete month of delay. However, the total amount of the pen­alty may not be less than GEL50 or more than 30% of the amount of tax liability. A penalty for an understatement of tax liability or overstatement of a tax credit that results from a change of the tax­able point by the GTA is imposed at a rate of 10% of the relevant amount. The percentage is 50% in all other cases. No penalty is imposed if a taxpayer voluntarily files an adjusted tax return.

Dividends. A dividend withholding tax is imposed on dividends paid by Georgian enterprises to individuals, not-for-profit com­panies and foreign legal entities. However, dividends paid to Georgian legal entities are not subject to withholding tax and are not included in taxable income. The current dividend withhold­ing tax rate is 5%.

The following types of dividends are not subject to withholding tax and are not included in taxable income:

  • Dividends paid by International Financial Companies
  • Dividends paid by Free Industrial Zone Companies in Free Industrial Zones
  • Dividends paid on free-floating securities (debt or equity securi­ties listed on the stock exchange with a free-float rate in ex cess of 25% as of 31 December of the current and preceding report­ing year, according to information provided by the issuer of the securities to the stock exchange)
  • Dividends paid by Agricultural Cooperatives to their members until 1 January 2017

Interest. An interest withholding tax is imposed on interest pay­ments made by a permanent establishment of a nonresident or a resident or on their behalf. However, interest paid to resident banks is not subject to withholding tax. The current interest with­holding tax rate is 5%.

The following types of interest payments are not subject to with­holding tax and are not included in taxable income:

  • Interest paid by financial institutions licensed according to the Georgian law. However, interest is included in gross income if the recipient is also a licensed financial institution.
  • Interest paid by Free Industrial Zone Companies in Free Industrial Zones.
  • Interest paid on free-floating securities.
  • Interest paid on debt securities issued by Georgian entities listed on recognized foreign stock exchanges.
  • Interest paid on debt securities issued by International Financial Institutions (a list of International Financial Institutions is con­tained in a resolution of the government of Georgia).

The following rules apply to interest due to individuals (except for value-added tax [VAT] payers) and nonresident companies (except for their permanent establishments in Georgia):

  • Outstanding interest liability that was deducted as an expense from gross income of the 2006 tax year and was not yet paid as of 31 December 2012 was deemed paid on 31 December 2012.
  • Outstanding interest liability that was deducted as an expense from gross income of the 2007 tax year and was not yet paid as of 31 December 2012 was deemed paid on 1 July 2013.
  • Outstanding interest liability that was deducted as an expense from gross income of the 2008 tax year and was not yet paid as of 31 December 2013 was deemed paid on 31 December 2013.
  • Outstanding interest liability that was deducted as an expense from gross income of the 2009 tax year and is not yet paid as of 31 December 2014 is deemed paid on 31 December 2014.
  • Outstanding interest liability that was deducted as an expense from gross income of the 2010 tax year and is not yet paid as of 31 December 2015 is deemed paid on 31 December 2015.

Foreign tax relief. Foreign income tax paid on income generated from foreign sources may be credited against Georgian tax im­posed on the same income, limited to the amount of such Georgian tax (that is, up to the amount of corporate income tax that would have been payable on such income in Georgia).

Determination of taxable income

General. Taxable income is computed on the basis of International Financial Reporting Standards (IFRS), modified by certain tax adjustments. It includes the following:

  • Trading income
  • Capital gains
  • Income from financial activities
  • Gratuitously received assets
  • Works and services
  • Other items of income

Income received in foreign currency is converted into Georgian lari (GEL) at the daily exchange rate determined by the National Bank of Georgia (NBG) for the date of receipt of the income.

In general, to calculate taxable income, taxpayers may deduct from gross income all documented expenses contributing to the generation of such income. However, certain expenses are nonde­ductible or partially deductible for tax purposes.

Nondeductible expenses include the following:

  • Expenses related to noneconomic activities (except charitable contributions up to 10% of taxable income before taking into account the charitable expenses).
  • Entertainment expenses, unless a taxpayer conducts economic activities of an entertaining nature and the entertainment ex penses are incurred in the course of these activities.
  • Expenses related to the generation of income exempt from corporate income tax.
  • Expenses incurred on goods and services that are outside the scope of corporate income taxation, except for a gratuitous sup­ply to the state or a local government.
  • Corporate income tax paid or payable in Georgia or abroad.
  • Penalties and fines paid or payable to the Georgian state budget.
  • Interest expenses above the percentage established annually by the Minister of Finance of Georgia (24% since January 2011) and subject to thin-capitalization rules in certain cases (see Section E).
  • Representation expenses in excess of 1% of the gross income earned during the tax year.
  • Provisions for doubtful receivables (see Provisions).
  • Capital repair expenses with respect to fixed assets in excess of 5% of the balance value of the corresponding tax depreciation group of fixed assets at the end of the preceding tax year. How­ever, such expenses are fully deductible if a person applies the full depreciation method (see Tax depreciation). Repair expens­es with respect to rented fixed assets are deductible according to the rules discussed in Tax depreciation.
  • Expenses incurred on goods and services purchased from a Micro Business, unless the income derived by the Micro Busi­ness from the provision of such goods and services is taxed under a general rule (that is, at a rate of 20%). An individual may obtain the special status of a Micro Business for tax purposes if it conducts economic activities independently without hiring employees, receives annual gross income up to GEL30,000, maintains an inventory balance of no more than GEL45,000 and undertakes activities that are not banned for a Micro Business as provided by the government of Georgia.

Virtual Zone Persons may deduct expenses from their gross in­come in proportion to the part of their income received from the supply of information technology in Georgia.

To calculate taxable income, an enterprise must use the same method of accounting (cash method or accrual method) that is used in its financial accounting.

Notwithstanding the above, for payments made to individuals and payments to nonresident enterprises for the rendering of services, the moment of payment is considered to be the moment of incurring the expenditure. This cash-basis rule does not apply to licensed financial institutions.

Fines defined by agreements and other penalties are also ac­counted for on a cash basis.

Inventories. Inventories produced or purchased are valued at the production cost or purchase price. Costs for storage and transpor­tation must be included in the value of inventories. If inventories cannot be sold at a price above cost, they must be valued at the possible realization price less any selling expenses. The actual cost (of identifiable items), weighted average cost or first-in, first-out (FIFO) methods may be used to value inventories.

Provisions. Banks, credit unions and insurance companies may deduct certain provisions from their gross income of the reporting year in accordance with the rules established by the NBG. Banks and credit unions may deduct allocations to reserves for bad debts if doubtful receivables have been written off in their financial accounting books.

Insurance companies may deduct from their gross income of a reporting year net insurance losses incurred in the same reporting period, excluding income from regression and survived property.

Leasing companies may deduct from their gross income allow­ances for bad debts related to leasing activities according to the rules set by the Minister of Finance of Georgia. For this purpose, a leasing company is an entity that derives at least 70% of its total gross income for a tax year from the leasing of property. No other provisions are deductible.

Tax depreciation. Depreciation charges for fixed assets used in economic activities are deductible for tax purposes in accordance with the rates and conditions set forth in the Tax Code of Georgia (TCG).

Depreciation is not assessed with respect to land, works of art, museum items, historical objects (except for buildings) and other non-amortized fixed assets. Expenditures on fixed assets with a value below GEL1,000 and biological assets (animal or plant) can be fully deducted from gross income in the year in which the exploitation of the fixed assets begins or in the year in which the expenses on biological assets are incurred.

Fixed assets are allocated to groups, which are depreciated as whole units. If at the end of a tax year, all fixed assets in a group are realized or liquidated or the balance of the group is less than GEL1,000, the entire balance of the group may be claimed as a tax deduction.

If the realization price of fixed assets of a group (for a gratuitous supply, the market value of a group) during the tax year exceeds the book value of the group at the end of this tax year, the surplus amount is included in the gross income and the book value of the group equals zero.

The amount of depreciation for each group is calculated by ap plying the depreciation rates for the group to the tax value of the group at the end of the tax year. The following are the princi­pal assets and depreciation rates for each group.

Group Assets Depreciation rate (%)
1 Passenger cars; automobile equipment for use on roads; office furniture; automotive transport rolling stock; trucks, buses, special automobiles and trailers; machinery and equipment for all sectors of industry and the foundry industry; forging and pressing equipment; construction equipment;
and agricultural vehicles and equipment
20
2 Special instruments, inventory and equipment; computers, peripheral devices and data processing equipment;
and electronic devices
20
3 Railway, naval and river transport vehicles; power vehicles and equipment; thermal technical equipment and turbine equipment; electric engines and diesel generators; electricity transmission and
communication facilities; and pipelines
8
4 Buildings and construction structures 5
5 Assets subject to depreciation that are not included in the other groups 15

Taxpayers may apply accelerated depreciation rates for Groups 2 and 3, but these rates may not be higher than double the rates provided in the above table.

Intangible assets are amortized over their useful life or at an annual rate of 15% if it is impossible to determine the useful life of a particular intangible asset. The annual amortization is appor­tioned on a pro rata basis if the intangible asset is used for a cer­tain time period during a year. Amortization expenses with respect to intangible assets are deductible for tax purposes. Intangible assets with a value below GEL1,000 can be fully deducted from gross income in the year when the respective expense is in curred. Expenses incurred to purchase or produce amortized intangible fixed assets are not capitalized if they had been deducted previ­ously from gross income.

Taxpayers may use an alternative method to compute the deduc­tion of expenditure on fixed assets, other than non-amortized fixed assets and fixed assets contributed into the capital of a company. Under this alternative method, a company may fully deduct the cost of such assets in the year in which it begins to exploit the assets, including their capital repair expenses. These fixed assets are not included in the asset groups for depreciation. If such assets are sold subsequently, the sale price (for a gratuitous supply, market value) is included in gross income. If a company uses the alternative method, it must use this method for all fixed assets purchased or produced thereafter and must use this method at least for five years.

Leasing. Each fixed asset supplied under leases is recorded as a separate group by the lessor. Fixed assets supplied under leases are amortized according to the discounted value of lease payments.

On the expiration or termination of a lease agreement, if the leased asset is returned to the lessor, this asset remains in the same group without further depreciation until it is leased again.

The corporate income tax provisions effective before 1 January 2010 apply to assets leased before this date.

Repair expenses for rented fixed assets. Repair expenses that do not reduce rent payments for rented fixed assets constitute a separate group of assets that are depreciated at the rate set for Group 5. On the expiration or termination of a rent agreement, the remaining balance value for this group is annulled and may not be deducted from gross income.

Relief for losses. Enterprises may carry forward a loss incurred in a tax year to the following five tax years for offset against future profits. On request of a taxpayer, the loss carryforward period may be extended to 10 years. The statute of limitations changes from 6 years to 11 years if a 10-year carryforward period is select­ed by a taxpayer. A 10-year carryforward period can be changed to a 5-year carryforward period when the losses carried forward are used up.

International Financial Companies, Special Trade Companies and Free Industrial Zone Companies (see Section B) cannot carry for­ward losses.

Losses cannot be carried back.

Groups of companies. Consolidated returns of companies are not allowed. All companies must file separate tax returns. In addi­tion, Georgian law does not contain any measures allowing mem­bers of a group to offset profits and losses.

Other significant taxes

The following table summarizes other significant taxes.

Nature of tax Rate (%)
Value-added tax (VAT); imposed on goods and
services supplied in Georgia and on imported
goods; reverse-charge VAT is imposed on
works and services carried out in Georgia
By nonresident entities
18
Property tax; on the average annual net book
Value of fixed assets
1
Property tax for leasing companies on leased
assets
0.6

Georgia also imposes several other minor taxes.

Miscellaneous matters

Foreign-exchange controls. The Georgian currency is the lari (GEL). The lari is a non-convertible currency outside Georgia. Enterprises may buy or sell foreign currencies through autho­rized banks or foreign-exchange offices in Georgia.

Georgia does not impose restrictive currency-control regulations. Enterprises may open bank accounts abroad without any restric­tion if they declare such accounts (other than deposit accounts) with the GTA within five working days after opening such accounts. In general, all transactions performed in Georgia must be conducted in lari. Transactions with nonresident entities can be conducted in other currencies.

Transfer pricing. Under the transfer-pricing (TP) rules set by the TCG, the arm’s-length principle applies to transactions carried out by taxpayers with related parties. The TP rules generally apply to cross-border transactions between related parties. These rules may also apply to transactions between a Georgian resident entity and an unrelated foreign entity that is a resident of a low-tax jurisdic­tion or offshore country and transactions between a Georgian company and its permanent establishment.

The generally accepted transfer-pricing methods include the fol­lowing:

  • Comparable uncontrolled price method
  • Resale price method
  • Cost-plus method
  • Net profit margin method
  • Profit split method

The Minister of Finance of Georgia is authorized to provide detailed descriptions of TP methods, their application rules and other procedural rules.

In 2013, the Minister of Finance of Georgia enforced the Instruc­tion “On Pricing International Controlled Transactions,” which is in accordance with the TCG provisions. The Instruction covers the following items:

  • Scope of transactions subject to Georgian transfer-pricing rules
  • Acceptable transfer-pricing methods
  • Comparability criteria
  • Information sources
  • Arm’s-length range
  • Procedure for advance pricing agreements
  • Transfer-pricing documentation requirements
  • Other procedural issues

It also outlines required actions for companies doing business in Georgia.

Thin capitalization. Thin capitalization occurs when the debt- to-equity ratio exceeds 3:1 (5:1 for a leasing company). In the event of thin capitalization, a company may not deduct paid or pay­able interest expenses from its gross income. However, the thin-capitalization rules do not restrict the deduction of interest ex­penses on debt below the established ratio. Thin-capitalization rules do not apply to financial institutions, entities with annual gross income of GEL200,000 or less or cases in which interest expenses do not exceed 20% of the taxable income before deduc­tion of interest expenses.

Thin capitalization is determined according to the average annual ratio, in accordance with the rules set by the Minister of Finance of Georgia. These rules apply to transactions occurring on or after 1 January 2013.

Treaty withholding tax rates

Georgia has entered into tax treaties with 49 countries. The table below lists the withholding tax rates under these treaties. In gen­eral, if the withholding tax rate provided in a treaty exceeds the rate provided by the TCG, the latter rate applies.

Dividends

%

Interest

%

Royalties

%

Armenia 5/10 (a) 10 5
Austria 0/5/10 (b) 0 0
Azerbaijan 10 10 10
Bahrain 0 0 0
Belgium 5/15 (c) 0/10 (d) 5/10 (e)
Bulgaria 10 10 10
China 0/5/10 (b) 10 5
Croatia 5 5 5
Czech Republic 5/10 (f) 0/8 (g) 0/5/10 (h)
Denmark 0/5/10 (i) 0 0
Egypt 10 10 10
Estonia 0 0 0
Finland 0/5/10 (j) 0 0
France 0/5/10 (k) 0 0
Germany 0/5/10 (l) 0 0

 

Greece 8 8 5
Hungary 0/5 (u) 0 0
India 10 10 10
Iran 5/10 (a) 10 5
Ireland 0/5/10 (m) 0 0
Israel 0/5 (w) 0/5 (y) 0
Italy 5/10 (f) 0 0
Japan 15 10 0/10 (bb)
Kazakhstan 15 10 10
Kuwait 0/5 (x) 0 10
Latvia 5/10 (n) 0/5 (z) 5
Lithuania 5/15 (o) 10 10
Luxembourg 0/5/10 (p) 0 0
Malta 0 0 0
Netherlands 0/5/15 (q) 0 0
Norway 5/10 (v) 0 0
Poland 10 10 10
Portugal 5/10 (f) 10 5
Qatar 0 0 0
Romania 8 10 5
San Marino 0 0 0
Serbia 5/10 (f) 10 10
Singapore 0 0 0
Slovak Republic 0 5 5
Slovenia 5 5 5
Spain 0/10 (r) 0 0
Sweden 0/10 (aa) 0 0
Switzerland 10 0 0
Turkey 10 10 10
Turkmenistan 10 10 10
Ukraine 5/10 (a) 10 10
United Arab Emirates 0 0 0
United Kingdom 0/15 (s) 0 0
Uzbekistan 5/15 (t) 10 10
Non-treaty countries 5 5 5
    a) The 5% rate applies if the actual recipient of the dividends is a company (other than a partnership) that holds directly at least a 25% share in the capi­tal of the payer of the dividends. The 10% rate applies in all other cases.
    b) The 0% rate applies if the beneficial owner of the dividends is a company that holds directly or indirectly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than EUR2 million (or the equivalent amount in Georgian lari). The 5% rate applies if the beneficial owner is a company that holds directly or indirectly at least 10% of the capi­tal of the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in Georgian lari). The 10% rate ap­plies in all other cases.
    c) The 5% rate applies if the beneficial owner of the dividends is a company that holds at least 25% of the capital of the payer of the dividends. The 15% rate applies in all other cases.
    d) The 0% rate applies if the recipient is the beneficial owner of interest on a commercial debt-claim, including a debt-claim represented by commercial paper, resulting from deferred payments for goods, merchandise or services supplied by an enterprise or if the recipient is the beneficial owner of interest on a loan that is represented by a bearer instrument and that is granted by a banking enterprise. The 10% rate applies in all other cases.
    e) The 5% rate applies if the beneficial owner of the royalties is a company. The 10% rate applies in all other cases.
    f) The 5% rate applies if the beneficial owner of the dividends is a company (other than a partnership) that holds directly at least 25% of the capital of the payer of the dividends. The 10% rate applies in all other cases.
    g) The 0% rate applies if the recipient is the beneficial owner of interest on credit sales of industrial, commercial or scientific equipment. The 8% rate applies in all other cases.
    h) The 0% rate applies if the recipient is the beneficial owner of royalties paid for the use of, or the right to use, copyrights of literary, artistic or scientific works, except for computer software and including cinematographic films, and films or tapes for television or radio broadcasting. The 5% rate applies if the recipient is the beneficial owner of royalties paid for the use of, or the right to use, industrial, commercial or scientific equipment. The 10% rate applies if the recipient is the beneficial owner of royalties paid for the use of, or the right to use, patents, trademarks, designs or models, planes, secret formulas or processes, computer software or information concerning indus­trial, commercial or scientific experience.
    i) The 0% rate applies if the actual recipient of the dividends is a company that holds directly or indirectly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than EUR2 million (or the equivalent amount in Danish krone or Georgian lari). The 5% rate applies if the actual recipient is a company that holds directly or indirectly at least 10% of the capital of the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in Danish krone or Georgian lari). The 10% rate applies in all other cases.
    j) The 0% rate applies if the actual recipient of the dividends is a company (other than a partnership) that holds directly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than EUR2 mil­lion (or the equivalent amount in Georgian lari). The 5% rate applies if the actual recipient is a company (other than a partnership) that holds directly at least 10% of the capital of the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in Georgian lari). The 10% rate applies in all other cases.
    k) The 0% rate applies if the actual recipient of the dividends is a company that holds directly or indirectly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than EUR3 million (or the equivalent amount in Georgian lari). The 5% rate applies if the actual recipi­ent is a company that holds directly or indirectly at least 10% of the capital of the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in Georgian lari). The 10% rate ap­plies in all other cases.
    l) The 0% rate applies if the actual recipient of the dividends is a company (other than a partnership) that holds directly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than EUR3 mil­lion (or the equivalent amount in any currency). The 5% rate applies if the actual recipient is a company (other than a partnership) that holds directly at least 10% of the capital of the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in any currency). The 10% rate applies in all other cases.
    m) The 0% rate applies if the beneficial owner of the dividends is a company that holds directly or indirectly at least 50% of the voting rights in the payer of the dividends and that has invested in the payer at least EUR3 million (or the equivalent amount in Georgian lari). The 5% rate applies if the beneficial owner is a company that holds directly or indirectly at least 10% of the voting rights in the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in Georgian lari). The 10% rate applies in all other cases.
    n) The 5% rate applies if the beneficial owner of the dividends is a company (other than a partnership) that holds directly at least 10% of the capital of the payer of the dividends. The 10% rate applies in all other cases.
    o) The 5% rate applies if the beneficial owner of the dividends is a company (other than a partnership) that holds directly at least 25% of the capital of the payer of the dividends and that has invested in the payer at least EUR75,000. The 15% rate applies in all other cases.
    p) The 0% rate applies if the actual recipient of the dividends is a company that holds directly or indirectly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than EUR2 million (or the equivalent amount in Georgian lari). The 5% rate applies if the actual recipi­ent is a company that holds directly or indirectly at least 10% of the capital of the payer of the dividends and that has invested in the payer more than EUR100,000 (or the equivalent amount in Georgian lari). The 10% rate applies in all other cases.
    q) The 0% rate applies if the beneficial owner of the dividends is a company that holds directly or indirectly at least 50% of the capital of the payer of the dividends and that has invested in the payer more than USD2 million (or the equivalent amount in euros or Georgian lari). The 5% rate applies if the recipient is a company that holds at least 10% of the capital of the payer of the dividends. The 15% rate applies in all other cases.
    r) The 0% rate applies if the beneficial owner of the dividends is a company (other than a partnership) that holds directly at least 10% of the capital of the company paying the dividends. The 10% rate applies in all other cases.
    s) The 15% rate applies if the dividends are paid out of income derived directly or indirectly from immovable property within the meaning of Article 6 by an investment vehicle that distributes most of this income annu­ally and if the income from such immovable property is exempt from tax. The 0% rate applies in all other cases.
    t) The 5% rate applies if the actual recipient of the dividends is a company (other than a partnership) that holds directly at least 25% of the capital of the payer of the dividends. The 15% rate applies in all other cases.
    u) The 0% rate applies if the beneficial owner of the dividends is a company (other than a partnership that is not liable to tax) that has held directly at least 25% of the capital of the company paying the dividends for an uninter­rupted period of at least 12 months before the decision to distribute the dividends. The 5% rate applies in all other cases.
    v) The 5% rate applies if the beneficial owner of the dividends is a company (other than a partnership) that holds directly at least 10% of the capital of the company paying the dividends. The 10% rate applies in all other cases.
    w) The 0% rate applies if the beneficial owner of the dividends is either of the following:
  • A company (other than a partnership) that holds directly at least 10% of the capital of the company paying the dividends
  • A pension fund or other similar institution providing pension schemes in which individuals may participate to secure retirement benefits if such pension fund or other similar institution is established and recognized for tax purposes in accordance with the laws of the other state. The 5% rate applies in all other cases.

x) The 0% rate applies if the beneficial owner of the dividends is a company that has invested in the payer more than USD3 million (or the equivalent amount in Georgian lari). The 5% rate applies in all other cases.

y) The 0% rate applies to pension funds and recipients of interest on corporate bonds traded on a stock exchange in the other state and issued by a company that is a resident of that state. The 5% rate applies in all other cases.

z) The 0% rate applies to recipients of interest on loans or credits granted by banks. The 5% rate applies in all other cases.

(aa) The 0% rate applies if the beneficial owner of the dividends is a company (or partnership) that holds at least 10% of the capital of the company paying the dividends. The 10% rate applies in all other cases.

(bb) The 0% rate applies to royalties paid as consideration for the use of, or the right to use, copyrights of literary, artistic or scientific works, including cinematographic films and films or tapes for radio or television broadcast­ing. The 10% rate applies to royalties paid as consideration for the use of, or the right to use, patents, trademarks, designs or models, plans, secret formu­las or processes, for the use of, or the right to use, industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience.

Tax treaties have been initialed with Lebanon and Oman.