Remote registration of a Georgian company with a corporate account in the bank Alpinum (Lichtenstein)

A company in Georgia can bring many benefits to non-residents. Having registered such a company, you may optimize taxation as well as obtain other advantages. Moreover, the Georgian jurisdiction is very attractive die to its confidentiality. Let us remind that Georgia does not participate in the automatic exchange of fiscal data with other countries (CRS). By opening a company in this small Caucasian country, a non-resident may significantly reduce his costs: tax, labor payment, utilities; he also obtains a free access to markets of countries with more than 1 billion customers.

Except great perspectives in the global business, benefits of Georgia are: stable economy (expected GDP growth in 2019 – up to 5%), absence of corrupting and red-tape, support of investors on the part of the state, and protection of their rights on a high level.

Opening a company in Georgia on your own will take much time, as before starting the process you will need to study the local legislation. You should also keep in mind that the official documents here are executed in Georgian language; an application registration of a company also must be in Georgian, just as the further bookkeeping.

To avoid these obstacles and significantly speed up the process of company registration in Georgia, you may use the services by Offshore Pro Group. We specialize in the said services and have a wide experience of working in this sphere. Our employees are native Georgian speakers and perfectly know the local legislation and peculiarities of mentality. By offering our services you will greatly you’re your time and money, and will obtain a full-scale Georgian company afterwards. The price of registration of a company in Georgia with a corporate account in the bank Alpinum (Lichtenstein) – 6 950 EUR, provided that only natural persons are among founders; if legal entities are among founders, the price increases up to 7 950 EUR.

Opening a company in Georgia: basic “whys”

Georgia is the small country in the Western part of the Caucasus. Its benefits are the available exit to the Black Sea, location on the border of Asia and Europe, and a great number of HPP (21). The main trends of economy are: food (wine production, mineral water, spices), light industry (apparel production), ferrous metallurgy (production of ferrous alloys), tourism (share of GDP in two quarters of 2019 made 7,7%, share in 9 months of 2019 – 2,8 bln. USD).

Why is the Georgian jurisdiction so attractive for non-residents?

Types of business forms in Georgia

As of 01.06.2019, according to the Sax Stat, almost 174 thousands economic subjects are operating in Georgia. Making business subject to the Georgian Law “On entrepreneurship” is possible in the following organizational-legal forms:

• sole proprietor – 92 900;
• limited liability company (LLC) – 72 240;
• joint stock company (JSC) – 869;
• limited partnership – 22;
• company with solidary responsibility – 201;
• cooperative – 180.

As shown, the most popular forms are sole proprietor and LLC, which is explained by simplicity of registration and organization of business. Meanwhile, these organizational-legal forms are well known to businessmen from CIS.

It should be mentioned that currently more than 17 thousand companies, which were established by non-residents, are operating in Georgia. For 2018, companies with foreign owners paid to the state budget taxes in amount of 945,1 million lari. For comparison, in 2017 this amount was 827,5 mln. lari. Therefore, every year the contribution of non-residents to the budget of Georgia is increasing, which certifies the growing popularity of the jurisdiction among foreign businessmen.

Taxation

The country applies one of the best tax systems in the world according to PwC (rating Paying Taxes 2019). Analytics of the agency put Georgia on the 16 place among 190 countries of the world. By their estimates, Georgian companies need just 220 hours of work to perform all obligations, while the tax burden on the income is 9,9%.

Since 2017, Georgia applies the “Estonian model” of taxation, i.e. the tax on income is only charged to the fixed income. If a company uses the obtained income for its development, this is not subject to taxation.

Standard taxation rates in Georgia are:

• tax on income – 15%, only charged on fixed income;
• VAT – 18%, applied to goods and services provided in the territory of Georgia;
• on property – up to 1%, applied to real estate owned by legal entities;
• tax on dividends – 5%, charged at the moment of payment;
• excise tax – graduated rate depends on the type of products; is only paid by companies trading excisable goods;
• customs duties – 0%/5%/12% depending on the type of imported goods.

Except these payments, from the beginning of 2019 Georgia had introduced mandatory pension contributions – 2% paid by an employer, another 2% paid by an employee.

Preferential terms of taxation are applicable in Georgia for small-scale companies as well (profit up to 500 000 lari yearly). These companies only pay 1% of their turnover.

Personal account in TBC Bank for non-residents – one of the best instruments for managing private assets.

Registration of a company in Georgia

By simplicity or the procedure of company registration, Georgia takes the 2 place in the world after New Zealand (rating Doing Business 2020). Here this process is maximum simple and available for everybody, including non-residents.

Submitting documents for registration is made in Houses of Justice, which are available in every city of Georgia. Opening a company is made under the principle of “one window”; a businessman submits documents all in one place, where he also may pay a state fee, submit an application for registration of VAT payer, etc.

The price of registration is 100 lari — documents will be ready the next working day, or 200 lari – in this case, the statement from the register of legal entities will be given the same day.

Key problems faced by a non-resident who wants to start business in Georgia:

• not knowing the Georgian legislation and a poor command of Georgian language;
• mandatory availability of a legal address, which must be verified by a rental agreement or consent of property owner for rent, or a purchase and sale agreement.

The abovementioned obstacles can be easily avoided with the help of professionals from Offshore Pro Group. Feel free to contact us, and we will solve the defined tasks with the optimum benefits for you.

Free trade zones in Georgia

A special attention in Georgia should be given to free trade zones (FTZ) – these are territories at disposal of administrators (usually foreign investors) where a beneficial regime of taxation is applied. The latter means that companies registered in FTZ are not taxed, provided that they sell their products abroad.

In the territory of Georgia 4 such FTZ are functioning: two in Kutaisi, one in Tbilisi and one in Poti. Except a beneficial taxation, companies registered there may obtain the following advantages:

• low cost of electric energy (18% cheaper due to the absence of VAT);
• the entire necessary infrastructure for successful operation in one place (offices, warehouses, containers for storage, customs points, security, communications, etc.);
• right for using warehouse premises outside FTZ;
• cheap workforce – the average monthly income of Georgians usually does not exceed 300-400 USD;
• location in placers convenient from the point of delivery and logistics: near sea ports, railroad alleys, airports, and international highways;
• help with certification by place of origin with the purpose of issue of the certificate “Made in Georgia”, which allows duty-free import of goods to EU countries (including Great Britain), EFTA, CIS (including Ukraine),China. Hong Kong, and Turkey;
• no currency control.

Using FTZ considering the absence of Georgia among participants of CRS, by its characteristics, is similar to a classic offshore — a place with a low taxation rate and high confidentiality of data.

Beneficial taxation of IT companies

In Georgia IT companies that have executed the certificate “Virtual zone” are exempted from taxes, except the tax on dividends and contributions to the pension fund. Meanwhile, contributions to the pension fund are not charged from non-residents. Just as in companies of FTZ, persons of virtual zones do not pay fiscal fees only from export profit.

Besides, programmers and developers, as well as other companies of IT sector, are attracted to Georgia because of:

• confidentiality;
• low cost of bank services;
• low cost of company maintenance;
• no currency control.

Due to the abovementioned, these companies may greatly reduce their expenses and increase the effectiveness of operation.

Benefits of use and how to open a personal account remotely for a non-resident in Bank of Georgia.

Other advantages of the Georgian jurisdiction for non-residents

Besides, Georgia attracts investors from other countries (especially neighbor countries) due to:

• low level of corruption and absence of red-tape;
• stable economical situation (GDP growth till the end of year is expected around 5%);
• favorable geographic location – Georgia has a great transit potential because it is located on the border of Europe and Asia. Particularly over the territory of Georgia companies from countries of the Caspian region deliver their goods to Europe and CIS. Also, the transport system of Georgia is actively used by Chinese manufacturers. It should be noted that this small Caucasian country is viewed by the Chinese government is one of participants in the project “The New Silk Way”;
• 55 agreements on avoidance of double taxation;
• liberal immigration laws – non-residents from more than 90 countries of the world may stay in the territory of Georgia during 1 year without issuance of a visa.

Considering all the benefits that non-residents obtain after registering a company in Georgia, we also recommend to open a corporate account in the bank of Lichtenstein, Alpinum.

Corporate account for a Georgian company in the bank Alpinum (Lichtenstein)

The bank Alpinum has been successfully operating in Vaduz (Lichtenstein) since 2001. For more than 15 years of activity, it had provided services to natural persons and companies from around the world. Reliability and liquidity are the basic principles governing the bank’s operation; therefore, the bank only makes investments in sectors it knows well and is sure of a positive outcome. A small scale of the bank allows customers expecting an individual approach and prompt solution of the defined tasks.

This financial institution is the family bank ruled by three families: two of them are originally from Switzerland, one from Germany. Today the Swiss holding Transinvest, which was founded as early as the end of the XIX century, is leading among founders of Alpinum.

Having opened a corporate account here, a Georgian company may obtain an access to other advanced bank services, including those related to financial planning of assets.

Basic services of the bank Alpinum are:

• asset management – using modern strategies that optimally meet the needs and aspires of customers. Assets are managed transparently and professionally, in full correspondence to customer’s principles and the bank’s investment strategy;
• investment consulting – using personal advisers allows promptly obtaining the latest financial information, defining potential risks of a transaction and taking a right decision;
• internet banking – advanced system of bank payments allows customers solving a wide scope of financial issues while being far from a bank;
• lombard crediting – provision of quick loans under a floating charge;
• issue of debit and credit payment cars of international systems;
• documented credit operations.

When planning to cooperate with the bank Alpinum, a Georgian company should keep in mind that this financial institution is in Europe and here all international principles of transparency and exchange of information are observed.

Terms of cooperation with the bank Alpinum for a Georgian company

This bank specializes in investment products; therefore, it is reasonable to use it when planning to perform several operations per year, while actively participating in transactions on stock exchanges or making investments.

A corporate account in the bank Alpinum can be opened for a Georgian company that had met the following conditions:

• quarterly receipts to an account not less than 500 000 CHF in total;
• minimum daily balance on an account 250 000 CHF;
• company is not related to a jurisdiction under sanctions of FATF;
• is not an Anglo-American company in the form of LP;
• does not perform transactions in dollars;
• does not perform risky or unwanted activity (gabling, sex services, weapon trade, etc.).

Please mind that before start of services you should complete a special mandatory form and pay the bank a fee for examination of an application in amount of 5 000 CHF. Only after payment of a fee the bank starts the procedure of account opening. Meanwhile, a fee is not a 100% guarantee for opening an account. The bank may waive an application if its employees had found non-correspondence to criteria defined for customers; a fee in this case will not be reimbursed. The process of approval of an application usually takes 3-4 weeks.

Standard rates for services in the bank Alpinum:

• fee for examination of an application for opening a corporate account – 5 000 CHF;
• service fee – 1 500 CHF per year;
• incoming and outcoming payments – 0,2% minimum 100 CHF.

More details on tariffs of the bank Alpinum are provided by us upon request: [email protected].

How to open a corporate account in the bank Alpinum for a Georgian company

A corporate account in the bank of Lichtenstein will be useful for a company planning to perform just several operations per year, or is hugely interested in investing in foreign assets. The procedure of registration of a Georgian company and further opening of a corporate account in the bank Alpinum can be conditionally divided into the following stages:

1. Contacting us at: info@offshore-info.
2. Approval with our employee the basic characteristics of the upcoming Georgian company.
3. Paying for our services – from 6 950 EUR.
4. Our lawyer prepares a power of attorney for registration of a company in Georgia.
5. Customer notarizes the power of attorney and sends to us together with other documents.
6. Our lawyer prepares constitutive documents of the upcoming Georgian company, upon mandatory approval with a customer.
7. Registration of a company in Georgia.
8. Preparation of documents for opening a corporate account in the bank Alpinum (Lichtenstein).
9. Submitting an application to the bank and working on account opening.

Upon completion of all procedures, we send to a customer the entire set of constitutive documents for a Georgian company and documents and keys for access to an account in the bank Alpinum.

To open an account in the bank of Lichtenstein and to register a company in Georgia, a customer must provide:

• notarized copy of passport with apostille;
• customer’s questionnaire in the form of the bank Alpinum or a CV (completed in English);
• statements of an account, tax declaration, statement on salary (other documents certifying income);
• verification of address (utility bills, purchase and sale agreement for real estate, etc.).

Documents required from a Georgian company for opening a corporate account will be prepared by our specialists.

On average, the entire procedure of registration of a company in Georgia with a corporate account takes around 4 weeks. If you are interested in this service or if you plan to start business in Georgia, feel free to contact us at: [email protected]. We are glad to help you in solving the issues related to business in this country.