Startup Support in Georgia: Innovation Tax Statuses, Grants & Accelerators (2026)

Georgia spent more than a decade building a reputation as a low-friction base for technology companies through regimes such as Virtual Zone Person, International Company Status and the 1% Small Business Status.

In 2025, Georgia introduced a dedicated legal framework for innovative startups by amending the Law of Georgia on Innovations and creating a new system of innovation statuses and tax incentives. The framework is aimed at innovative companies that have secured qualifying investment or grant funding, complementing rather than replacing the country’s existing tax regimes.

This guide explains the tools that founders can actually use: the new innovation statuses first, followed by the grants, accelerators and public agencies that support them. It also compares the new framework with the established Virtual Zone, International Company and Small Business Status regimes, which may remain the better choice depending on the nature and stage of the business.

Unless stated otherwise, the legal analysis in this guide is based on the Law of Georgia on Innovations, the Tax Code of Georgia and the relevant implementing legislation. Information about grants, acceleration programmes and funding rounds is identified separately where it comes from official agency programmes rather than primary legislation.

The 2025 innovation reform in one paragraph

On 24 June 2025, the Parliament of Georgia adopted Law No. 718, amending the Law of Georgia on Innovations. The law was published on 27 June 2025, with its substantive provisions entering into force 90 days after publication (late September 2025).

The reform introduced a new legal framework centred on the Innovations Registry and created three new innovation statuses:

• Innovative Startup;
• Innovative SME; and
• R&D Service Provider.

At the same time, amendments to the Tax Code of Georgia linked the tax treatment of these entities to their status under the Law of Georgia on Innovations.

The Georgia’s Innovation and Technology Agency (GITA) administers the Innovations Registry, receives and examines applications, and performs the functions assigned to it under the Law. The formal decision to grant, suspend or revoke an innovation status is made by the Government of Georgia upon the recommendation of the Ministry of Economy and Sustainable Development of Georgia, in accordance with the statutory procedure.

Innovative Startup Status: the flagship regime

The Innovative Startup Status is the most generous of the three innovation statuses and is likely to be the most relevant for founders building high-growth, innovation-driven businesses in Georgia.

Who qualifies

The applicant must be a company registered in Georgia under the Law of Georgia on Entrepreneurs that creates an innovative product, develops an innovative process or provides innovative services.

In addition, during the two years preceding the application, the company must have secured qualifying external funding in one of the following forms:

• at least GEL 100,000 of investment from a registered investment fund, a registered angel investor network (or one of its members), or an accelerator; or
• at least GEL 150,000 in grant funding from Georgia’s Innovation and Technology Agency (GITA).

Funding received through a parent company or subsidiary established outside Georgia also qualifies, provided that the foreign entity itself obtained the funding from one of the approved sources.

The applicant must also satisfy the statutory eligibility requirements, including that:

• its income and expenditure are predominantly connected with the funded innovative activity;
• it has no outstanding recognised tax debt;
• it is not registered in the debtors’ register;
• it is not subject to insolvency proceedings; and
• it is not undergoing liquidation.

What the status provides

The tax incentives are available for a maximum period of 10 years, divided into three phases.

Years 1–3

• Salary income paid by the startup is exempt from personal income tax, up to the limit established by the Government of Georgia, currently GEL 10,000 per employee per month.

Years 4–6

• Salary income is taxed at 5%.
• The company benefits from a 5% profit tax rate, instead of the standard 15% tax on distributed profits.

Years 7–10

• Salary income tax increases to 10%.
• The applicable profit tax rate also increases to 10%.

Maintaining the status

The status is granted for one year and may be renewed annually, provided the company continues to satisfy the statutory conditions.

Additional investment milestones apply as the company progresses through the incentive period:

• Years 1–2: the company must continue to satisfy the original eligibility requirements.
• Years 3–5: by the end of the third year, the company must have raised at least GEL 5 million in total investment, of which at least 30% must originate from the approved funding sources.
• Years 6–10: by the end of the sixth year, the company must have raised at least GEL 15 million in total investment, with at least 30% again coming from the approved funding sources.

To renew the status, the company must submit evidence of continued compliance to GITA at least 30 days before the current status expires.

Interaction with other preferential regimes

The Innovative Startup Status is mutually exclusive with both International Company Status and Virtual Zone Person Status.

A company cannot hold these statuses simultaneously. If a company that already benefits from International Company Status or Virtual Zone Person Status is granted Innovative Startup Status, the previously held status is terminated in accordance with the legislation.

Choosing between these regimes is therefore a strategic decision and depends on the company’s business model, stage of development and expected sources of income.

Innovative SME Status: for research-intensive businesses

The Innovative SME Status is intended for companies that make a significant and continuing investment in research and development (R&D). Unlike the Innovative Startup Status, it is aimed at businesses with an established operating history rather than newly funded startups.

Who qualifies

The applicant must be a company registered in Georgia that qualifies as a Category III or Category IV enterprise under the Law of Georgia on Accounting, Reporting and Auditing.

In addition, during the preceding financial year the company must have:

• incurred R&D expenses equal to at least 5% of its annual revenue;

• incurred R&D expenses of at least GEL 100,000; and

• satisfied at least one of the following additional conditions:

  • it holds a patent or registered (deposited) software to which the R&D activity relates;
  • it purchases R&D services from a recognised research institution or a company holding R&D Service Provider Status; or
  • it records its R&D expenditure in accordance with the R&D Expenses Manual approved by the Government of Georgia.

What the status provides

The principal benefit is a corporate profit tax incentive linked to qualifying R&D expenditure.

When distributing the previous year’s net profit, the company may reduce its taxable profit base by an amount equal to three times its qualifying R&D expenses incurred during the preceding year.

The legislation also provides for additional support relating to reinvested profit, in accordance with the procedure established by the Government of Georgia.

Duration

The Innovative SME Status is granted without a fixed expiry date, provided the company continues to satisfy the statutory requirements.

To maintain the status, the company must submit an annual compliance report to Georgia’s Innovation and Technology Agency (GITA) by 30 April each year.

R&D Service Provider Status: for specialised research companies

The R&D Service Provider Status is intended for companies whose principal business is research and experimental development.

Who qualifies

The applicant must be a company registered in Georgia whose main activity falls within NACE Code 72.1 (“Research and experimental development in natural sciences and engineering”).

The company must also satisfy the statutory eligibility requirements, including that:

• at least 80% of its annual revenue is derived from qualifying R&D activities;
• it satisfies the financial and compliance requirements established by the legislation; and
• it meets the other conditions prescribed by the Law of Georgia on Innovations.

What the status provides

Companies holding R&D Service Provider Status benefit from:

• a 5% personal income tax rate on qualifying salary income; and
• a 5% corporate profit tax rate.

These preferential tax rates apply while the company continues to hold the status and satisfies the statutory conditions.

Duration

The R&D Service Provider Status is granted without a fixed expiry date, provided the statutory requirements continue to be met.

How to apply and what it costs

The application procedure is broadly the same for all three innovation statuses.

Applications are submitted to Georgia’s Innovation and Technology Agency (GITA), which examines the application and forwards its recommendation to the Ministry of Economy and Sustainable Development of Georgia. The Ministry then submits the matter to the Government of Georgia, which makes the formal decision to grant the status.

The status takes effect from the first day of the month following the Government’s decision.

The registration fees are:

Status	Registration fee
Innovative Startup	GEL 200
Innovative SME	GEL 500
R&D Service Provider	GEL 500

The GEL 500 registration fee also applies to investment funds, angel investor networks and accelerators that register in the Innovations Registry.

The detailed application procedure, supporting documents and review process are set out in the relevant Government of Georgia resolution. Before applying, applicants should also consult the official innovationstatus.gov.ge portal for the latest guidance and application forms.

The funding and acceleration ecosystem

The new innovation statuses are designed for companies that have already secured qualifying investment or grant funding. The Law of Georgia on Innovations therefore also establishes the criteria for the organisations whose funding counts towards eligibility.

Under the Law:

• an investment fund qualifies for registration if, during the preceding three years, it has invested at least GEL 1 million in innovative or technology companies, while holding no more than 20% of the equity in each portfolio company;
• an angel investor network must consist of at least 10 angel investors who have collectively invested at least GEL 300,000 in at least five companies during the preceding two years, with no more than 20% ownership in each company; and
• an accelerator must operate a structured programme lasting between three and twelve months, providing participants with a defined curriculum, workspace and qualified mentors.

GITA and other public support

Beyond administering the Innovations Registry, Georgia’s Innovation and Technology Agency (GITA) operates grant, acceleration and startup-support programmes.

Among the best-known initiatives is the Georgia Startup Academy, delivered in cooperation with 500 Global. Recent programme rounds have included stage grants of GEL 50,000 and GEL 150,000 for qualifying startups. These figures are based on official programme announcements rather than legislation, and funding amounts, budgets, partners and application rounds may change over time. Applicants should therefore consult the latest programme documentation before relying on any published figures.

On the broader business-development side, Enterprise Georgia, operating under the Ministry of Economy and Sustainable Development of Georgia, supports entrepreneurship, investment and exports through programmes including Produce in Georgia.

Which regime is right for your business?

Because the Innovative Startup Status cannot be combined with either Virtual Zone Person Status or International Company Status, choosing the appropriate regime is an important strategic decision.

As a general guide:

• an early-stage innovative company that has secured qualifying investment or GITA grant funding and intends to recruit employees in Georgia will often benefit most from the Innovative Startup Status, particularly during the initial salary tax incentive period;
• an established software or technology company generating export income may be better suited to Virtual Zone Person Status or, where the statutory substance requirements are satisfied, International Company Status; and
• a solo founder, consultant or freelancer testing a business idea may find it more advantageous to operate as an Individual Entrepreneur with Small Business Status and benefit from the 1% turnover tax regime, subject to the applicable eligibility rules.

Whichever route you choose, the practical foundations remain largely the same: registering a company, opening a business bank account and, where you or your team will carry out labour activity in Georgia, ensuring compliance with the Right to Work and Work Residence Permit requirements introduced by the 2026 labour migration reforms.

A note on a recently introduced framework

The innovation-status regime was introduced only recently, and administrative practice is still developing.

Although the statutory framework is established by the Law of Georgia on Innovations and the relevant Government of Georgia resolutions, grant programmes, acceleration initiatives and funding opportunities operate through individual programme rounds that may change over time.

The English consolidation of the legislation may not always be updated as quickly as the Georgian version. For the most current legal position, applicants should consult the Georgian-language legislation, the official innovationstatus.gov.geportal and the latest guidance issued by GITA.

Before choosing an innovation status, applicants should also confirm the current eligibility criteria, investment thresholds, registration fees and programme requirements with GITA, the Ministry of Economy and Sustainable Development of Georgia and, where relevant, Enterprise Georgia. Professional legal and tax advice is recommended, particularly because Innovative Startup Status cannot be combined with Virtual Zone Person Status or International Company Status.

Frequently asked questions

What startup tax statuses does Georgia now offer?

Since the June 2025 reform of the Law on Innovations there are three: Innovative Startup Status, Innovative SME Status, and Research-and-Development (R&D) Service Provider Status. They are separate from, and cannot be combined with, the older Virtual Zone Person and International Company statuses. All three are administered by Georgia's Innovation and Technology Agency (GITA) through the Innovations Registry, with the status itself granted by the Government of Georgia on the recommendation of the Ministry of Economy and Sustainable Development.

What does the Innovative Startup Status give you?

It is a tiered relief lasting up to ten years. In the first three years, salaries the startup pays are exempt from the 20% personal income tax up to a ceiling set by government decree (10,000 GEL per month per employee). From year four through year six, salaries are taxed at 5% and the profit (corporate) tax rate is 5%. From year seven through year ten, both rise to 10%. The status is granted for one year at a time and renewed on proof of continued eligibility.

Who qualifies as an Innovative Startup?

A company registered in Georgia under the Law on Entrepreneurs that creates an innovative product, develops an innovative process, or provides innovative services, and that in the two years before applying either raised at least 100,000 GEL from a registered investment fund, an angel-investor network or its member, or an accelerator, or received at least 150,000 GEL in grant funding from GITA. Its income and expenses must be substantially tied to the funded activity, and it must have no tax debt, no insolvency proceedings and not be in liquidation. To keep the status into later years it must hit cumulative investment milestones — at least 5 million GEL by the end of year three and 15 million GEL by the end of year six, with at least 30% from the approved funding sources.

What are the Innovative SME and R&D Service Provider statuses?

The Innovative SME Status is for a Category III or IV company whose prior-year R&D spending is at least 5% of revenue and at least 100,000 GEL, and that holds a patent or registered software, buys R&D from research bodies, or tracks R&D under the government manual. Its main benefit is a triple deduction of prior-year R&D costs against the profit-tax base on dividends, plus support for reinvested profit. It is granted indefinitely. The R&D Service Provider Status is for a company earning at least 80% of revenue from R&D activity (NACE code 72.1); it gives a permanent 5% salary income-tax rate and 5% profit-tax rate, and is granted once, indefinitely.

What grants and accelerators are available?

GITA, Georgia's Innovation and Technology Agency, runs grant and acceleration programmes, including the Innovative Startup Acceleration Programme delivered with 500 Global as the Georgia Startup Academy. Reported stage grants have reached 50,000 GEL and 150,000 GEL for startups advancing through the programme. Enterprise Georgia, under the Ministry of Economy, supports business creation, refurbishment and exports, largely through the 'Produce in Georgia' framework. Programme terms, budgets and calls change frequently, so confirm the current round directly with GITA and Enterprise Georgia before relying on a figure.

Can I combine a startup status with Virtual Zone or International Company status?

No. The law expressly forbids holding the Innovative Startup Status together with International Company Status or Virtual Zone Person status; if a company with either of those is granted startup status, the older status is cancelled. You should model which regime fits your business before applying, because they target different things — the Virtual Zone and International Company regimes suit established IT exporters, while the startup status suits early-stage, investment- or grant-funded innovation.

How do I apply for a startup status, and what does it cost?

Applications go to GITA, which reviews the file and forwards it to the Ministry of Economy and Sustainable Development; the Government then grants the status by decree, effective from the first day of the following month. The registry application fee is 200 GEL for an Innovative Startup and 500 GEL for an Innovative SME or R&D Service Provider (and for investment funds, angel networks and accelerators registering in the system). The detailed procedure and supporting documents are set in a government resolution, so check the current rule and the official portal before filing.