A step by step walkthrough of the most common form is in the guide How to register as an individual entrepreneur in Georgia.
The forms side by side
| Criterion | Individual entrepreneur | LLC | JSC | NCO |
|---|---|---|---|---|
| Separate legal entity | No | Yes | Yes | Yes |
| Minimum capital | None | None | GEL 100,000 | None |
| Owner liability | Personal, unlimited | Limited to contribution | Limited to shareholding | No profit distribution |
| Minimum participants | 1 | 1 | 1 | 2 or more for an association |
| Governance bodies | None | Director | General meeting, supervisory board, directorate | Board |
| Access to 1% small business status | Yes | No | No | No |
| Access to Virtual Zone | No | Yes | Yes | No |
| Typical use | Freelance, consulting | Product, hiring, investment | Large projects, raising capital | Foundations, associations |
Individual entrepreneur: easy to register, personally liable
An individual entrepreneur is not a separate legal entity. Registration is tied to the personal tax number of the individual, so business assets and personal assets are not legally separated. The entrepreneur answers for obligations with personal property.
In exchange the form carries minimal administrative load and unlocks small business status at 1% of turnover. That combination is what makes it the default choice for freelancers and consultants. Limits and conditions are covered in Small business status in Georgia at 1%.
It does not scale to a team or outside investment
You cannot sell a share in a sole trader registration or bring in a co-founder. As soon as a partner, an investor or meaningful headcount appears, the form stops working and the business is moved into an LLC.
LLC: the default form once you hire
A limited liability company can be set up by a single participant. The law sets no minimum share capital, so the company may be registered with a nominal or zero contribution. Liability is limited to the participant's contribution, and personal assets are not exposed to company debts.
An LLC fits when you need to hire staff, split equity between founders, take investment, or sign contracts with counterparties that require a legal entity. It is also the only practical form for IT companies seeking Virtual Zone status with its zero profit tax. The conditions are set out in Virtual Zone in Georgia.
Profit is taxed only when distributed
Georgia uses the Estonian model: the 15% profit tax arises not when income is earned but when dividends are paid. Reinvested profit is not taxed. The full set of rates is collected in Taxes in Georgia.
JSC: built for large projects, with a real entry barrier
A joint stock company requires minimum subscribed capital of GEL 100,000, of which at least 25% is paid in at incorporation. Governance is heavier: a general meeting of shareholders, a supervisory board and a directorate.
The form targets businesses raising capital from a wide circle of investors or preparing a share issue. For a two founder company it is overkill: an LLC solves the same problems without the capital requirement and without three tiers of governance. The incorporation procedure is described on the JSC registration in Georgia page.
NCO and specialised statuses
A non-commercial legal entity is formed as an association or a foundation and does not distribute profit to its members. It is used by charitable, educational and industry bodies. The procedure is on the NGO registration page.
It is worth separating legal form from tax status. The form defines what you are legally, the status defines how you are taxed:
- Small business status at 1%: sole traders only, charged on turnover.
- Virtual Zone: LLCs and JSCs in IT, 0% profit tax on exported services.
- International Company status: IT and maritime, permits work inside Georgia.
- Special Trade Company: a special regime for trading operations, see STC status.
Source note
> The company may be established by one person or by several partners, who might invest capital or start a company with zero capital.
Source: Law of Georgia on Entrepreneurs, matsne.gov.ge
Choosing a form for your situation
Rules of thumb that hold in most cases:
- Working alone, selling services, turnover within the small business cap: sole trader with 1% status.
- Partners, employees or a need to protect personal assets: LLC.
- Building software for foreign clients: LLC plus Virtual Zone status.
- Raising capital from a wide investor base: JSC.
- Non-commercial activity with no profit distribution: NCO.
Registering an LLC or a sole trader takes one to two working days at the National Agency of Public Registry. The general process is described in Company registration in Georgia.
Frequently asked questions
Can a sole trader be converted into an LLC?
There is no direct conversion between the forms. In practice a new LLC is registered, contracts and accounts are moved across, and the sole trader registration is then closed. It matters to settle accounts and file final returns, otherwise liabilities stay with the individual.
Is share capital required for a Georgian LLC?
The law sets no minimum share capital for an LLC. The company can be registered with a nominal contribution. Capital is stated in the founding documents, and its size does not affect eligibility for tax statuses.
How many shareholders does a JSC need?
A joint stock company can be incorporated by a single person. The constraint is capital rather than headcount: minimum subscribed capital is GEL 100,000, with at least 25% paid in at incorporation.
Can a non-resident own a Georgian company outright?
Yes. The owner's citizenship and tax residency do not restrict registration of an LLC or a JSC in Georgia. Director residency requirements appear in specific regulated areas, for example when obtaining a virtual asset service provider licence.
Which form gives zero profit tax?
The zero rate comes from Virtual Zone status rather than from the form itself. It is available to LLCs and JSCs in IT provided services are supplied outside Georgia. Incorporating an LLC on its own grants no exemption.
How Legalese handles this
We start from the business plan rather than the form: who the clients are, whether you will hire, whether partners or investors are expected, and what turnover you project. That drives both the legal form and the tax status that can be applied to it.
We then prepare the founding documents, register the company with the public registry, activate the tax profile on rs.ge and support the bank account opening. If a preferential regime fits, we apply for it separately.
The scope of work for each form is on the service pages: LLC incorporation, individual entrepreneur registration and JSC registration.
Key points
- A sole trader is not a separate legal entity and carries personal liability, but unlocks the 1% turnover rate.
- An LLC needs no minimum capital, limits liability to the contribution, and suits hiring, partnership and Virtual Zone status.
- A JSC requires GEL 100,000 subscribed capital with at least 25% paid at incorporation, plus three tiers of governance.
- An NCO is used for non-commercial activity with no distribution of profit.
- Legal form and tax status are chosen separately: the benefits attach to the status, not to registration itself.
To match a form to your situation, book a free consultation.