Georgia property taxes for a foreign owner: rental income and capital gains

Owning an apartment in Batumi raises a tax question the moment you either rent it out or sell it. Georgia's Tax Code sets specific, published rates for both situations, which this guide walks through article by article. None of it replaces a conversation with a tax adviser about your specific situation, and none of it answers how your own country of residence treats the same income; both of those need their own check. For the wider legal picture, see the Batumi investment guide.

Rental income: 5% without deducting expenses

Under article 81.2 of Georgia's Tax Code, a private individual who rents out a residential unit and does not deduct expenses is taxed at 5% on that rental income. This sits against the standard personal income tax rate of 20% under article 81.1, which applies more broadly to income that does not fall under one of the Code's specific lower rates. The 5% rate is specifically for a residential rental received by an individual on a no-deduction basis; it is not a general property tax rate, and it is not automatically available to every structure, for instance a company holding the unit rather than an individual, which is a distinction worth raising directly with a tax adviser before you assume it applies to your situation.

Capital gains: the two-year line

Article 82 exempts a capital gain realised by a private individual on the sale of an apartment, together with the land attached to it, once the property has been held for more than two years. Before that two-year mark, article 81.3 sets the tax rate on that same gain at 5%. The practical effect is a strong incentive to hold rather than flip a unit within the first two years, at least from a Georgian tax perspective; whether that incentive changes your plans depends on your own investment horizon and on how your country of residence would tax the same gain, which is a separate question again.

Local property tax: no rate to quote

Georgia's Tax Code also provides for a local property tax under articles 202 and 206, with the rate for a private individual tied to household income rather than fixed as a flat percentage of property value. Because the applicable rate depends on your specific household income and is set at a local level, there is no single figure that applies uniformly across every owner in Batumi, and none is quoted here. Confirm the current rate and any exemption threshold with a tax adviser once you own a specific unit, rather than budgeting around an assumed number.

A summary table, with the article behind each rule

Situation	Rate	Article
Rental income, individual, no expense deduction	5%	81.2
Standard personal income tax	20%	81.1
Capital gain, held more than two years	Exempt	82
Capital gain, held two years or less	5%	81.3
Local property tax	Depends on household income, no flat rate published	202, 206

Every line in this table is a rule in force as published by Georgia's Revenue Service at the time of writing, and every line needs confirming with a tax adviser before you rely on it, since tax rules can change and your specific circumstances may fall under a different provision than the general one described here.

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What this does not cover: your own country of residence

Georgian tax rules govern what you owe inside Georgia. They say nothing about how your country of residence treats rental income earned abroad or a capital gain realised on a foreign property, which depends on your local tax rules and on any tax treaty between your country and Georgia. A French, Belgian, Gulf-based or Egyptian owner, for instance, each faces a different answer at home, and none of those answers is addressed by the Georgian Tax Code article numbers above. Always raise this with a local tax adviser in your country of residence, separately from the Georgian-side confirmation.

How this compares to a purely qualitative read of rental yield

Knowing the tax rate on rental income is only one input into working out whether a unit makes sense as a rental. For the full method, including gross versus net yield and the other costs that sit alongside the 5% rate, see our guide on how to calculate gross and net rental yield; treat any return projection a developer publishes for a Batumi project as commercial marketing to be checked with that method, not as a tax-adjusted figure already baked in.

Working with Orven

Orven can connect you with a tax adviser familiar with Georgia's rules to confirm how articles 81, 82, 202 and 206 apply to your specific purchase, and separately point you to guidance on your obligations at home. Message Orven on WhatsApp at +971 52 776 1939 or by email at sales@orvenproperties.com with the project you are considering.

FAQ

What tax rate applies to rental income from a Batumi apartment? A private individual who does not deduct expenses is taxed at 5% on that rental income under article 81.2 of the Tax Code, against a 20% standard rate under article 81.1. Confirm current rules with a tax adviser.

Is there capital gains tax when I sell? If you have held the apartment for more than two years, the gain is exempt under article 82. Before that, it is taxed at 5% under article 81.3.

How much is the local property tax? It depends on household income rather than a flat rate, under articles 202 and 206. There is no single percentage to quote; confirm the current rate with a tax adviser once you own a specific unit.

Does Georgia's 5% rental tax mean I owe nothing in my home country? No. Georgian rates govern what you owe inside Georgia only. Your country of residence may tax the same income separately, depending on its own rules and any tax treaty with Georgia.

Can Orven confirm my personal tax position? No. Orven can introduce you to a tax adviser familiar with Georgia's rules and point you toward guidance for your home country, but the confirmation itself comes from that adviser, not from your property adviser.