---
title: "Georgia Tax and Payroll 2026 | Flat 20% Tax, 2% Pension"
description: "Georgia payroll 2026: a flat 20% income tax withheld at source, no employer social tax, and a 2% funded pension on each side."
canonical: https://www.teamed.global/country-hiring-guides/georgia/tax-and-payroll
---

Georgia · Tax & payroll child

Served by Teamed vetted partner-entity network in Georgia

# How does *Georgia payroll tax* work in 2026?

Forget tax bands. Georgia taxes a salary at one flat 20%, withheld at source, with no separate employer social tax on top. The only payroll contribution beyond income tax is the funded pension at 2% from the employer and 2% from the employee. That makes the Georgian payroll stack one of the leanest in the region.

Last reviewed 13 June 2026 · Georgia guide

![Tbilisi old town at golden hour with the Narikala fortress above terracotta rooftops and the Kura river below.](/images/country-guides/georgia-tax-payroll.webp)

Illustration · Tbilisi, Georgia

Answer.cite this

Georgia employer payroll in 2026 is short. There is no separate employer social security tax. The employer pays a funded pension of 2% of gross salary, and nothing else.

The employee side is also lean. Income tax is a flat 20%, withheld from pay before it lands. The employee pays a matching pension of 2%.

There are no progressive tax bands. Everyone pays the same 20% on salary. The State also adds a small top-up to the pension pot by income, so the pension is funded by three sides (Tax Code, art. 81(1)).

## What does an employer pay in Georgia payroll taxes?

Very little. Georgia has no separate employer social security tax. The employer pays a funded pension of 2% of the employee's gross salary.

That single 2% pension contribution is the whole employer payroll cost above salary. There is no health levy and no payroll tax (Law on Funded Pension, art. 3).

| Employer contribution | Rate | Applies to |
| --- | --- | --- |
| Funded pension | 2% | Gross salary, for employees enrolled in the scheme |
| Social security tax | None | Georgia levies no separate employer social charge |

### The funded pension is the only employer add-on

The employer pays 2% of gross salary into the employee's funded pension account. This was introduced by the [Law of Georgia on Funded Pensions](https://www.matsne.gov.ge/en/document/view/4280127) and runs through the Pension Agency. The employee pays the same 2%, and the State tops up the pot by 1 to 2 percent of income.

That is the full employer cost above salary. There is no employer health insurance contribution, no unemployment charge, and no general social tax. For an employer used to rates of 20 percent or more elsewhere in Europe, the Georgian 2% is a striking difference. It keeps the loaded cost of a Georgian hire close to the headline salary.

## What does an employee pay from their Georgia salary?

Two things come off the pay. Income tax is a flat 20%, withheld at source. The funded pension takes a further 2%.

There is no separate employee social insurance charge. Income tax plus the 2% pension is the entire employee deduction (Tax Code, art. 81(1)).

| Employee deduction | Rate | Applies to |
| --- | --- | --- |
| Income tax | 20% | Gross salary, flat, no bands |
| Funded pension | 2% | Gross salary, for enrolled employees |

### A flat rate, withheld before the salary lands

Georgia taxes salary income at a flat 20%. The employer withholds it from pay and remits it, so the employee never files a return on salary alone. There are no progressive bands and no rising marginal rate, so a senior hire pays the same 20% as a junior one.

### The pension comes off too

Enrolled employees pay 2% of gross salary into their funded pension account, matched by the employer's 2%. Enrolment is mandatory for employees who were under 40 when the scheme launched, and voluntary for older workers. The statutory monthly minimum wage in the private sector sits at GEL 20/month, a figure set in 1999 and never updated, so it has no real effect on payroll. Market salaries run far above it.

## Georgia income tax for 2026, a single flat rate

Georgia has one income tax rate. Salary is taxed at a flat 20%, with no progressive bands and no tax-free allowance.

The rate is the same for every salary level. It is withheld at source by the employer (Tax Code, art. 81(1)).

| Salary income | Rate |
| --- | --- |
| All salary, no threshold | 20% |

Most countries run income tax across several bands that climb as pay rises. Georgia does not. A natural person's taxable salary income is taxed at a flat 20% under [Article 81(1) of the Tax Code of Georgia](https://www.matsne.gov.ge/en/document/view/1043717). There is no zero-rate band, so tax applies from the first lari of salary.

### Why the flat rate matters for budgeting

A flat 20% makes net pay easy to model. Gross salary, less 20% income tax, less the 2% pension, gives you take-home in one calculation. There is no bracket creep to track as someone gets a raise. Note one common mix-up. The US state of Georgia is a different jurisdiction with its own tax rate. This page covers the country of Georgia in the Caucasus, whose flat rate is 20%.

## How does Georgia payroll withholding and filing work?

The employer withholds income tax from pay and remits it to the Revenue Service each month. The funded pension is remitted to the Pension Agency on the same monthly cycle.

Salary is paid at least once a month. Late payment of wages carries a small daily charge on the overdue amount (Labour Code, art. 41).

Revenue Service · Salary withholding (PIT)

Employers must withhold income tax at the flat 20% rate from each salary payment and remit it to the Georgia Revenue Service through the monthly declaration. Salary must be paid **at least once a month**. Late payment of wages carries a small daily charge on the overdue sum for every day of delay.

Source: [Tax Code of Georgia, Article 81(1)](https://www.matsne.gov.ge/en/document/view/1043717)

Georgia payroll runs on a monthly cycle. Each month the employer files one declaration that covers the withheld income tax and remits the funded pension to the Pension Agency. The two go to different bodies but share the same monthly rhythm:

- **Income tax** to the Georgia Revenue Service, withheld at 20% and declared monthly
- **Funded pension** to the Pension Agency, 2% employer plus 2% employee, monthly

Filing is done through the Revenue Service electronic portal. Wages themselves must be paid at least monthly, and a delay in paying wages carries a small daily charge on the overdue amount under the Labour Code. Get the monthly declaration and the pension remittance in on time and the Georgian run is one of the simplest in the region.

1. Collect pay data Gather salary and any taxable benefits for the month before the run closes.
2. Withhold income tax Apply the flat income tax rate to gross salary and hold it back from pay.
3. Deduct the pension Take the employee pension share off gross pay and set the matching employer share aside.
4. File the monthly declaration Submit the income tax declaration to the Revenue Service through the electronic portal.
5. Remit and pay wages Pay the withheld tax to the Revenue Service and the pension to the Pension Agency, then pay net wages. Wages are paid at least monthly.

## The funded pension in the Georgia payroll stack

The funded pension is the only contribution beyond income tax. The employer pays 2% and the employee pays 2% of gross salary.

The State adds a further 1 to 2 percent by income band. Enrolment is mandatory for younger workers (Law on Funded Pension, art. 3).

Georgia's funded pension is a three-sided scheme run by the Pension Agency. For each enrolled employee the contributions stack as follows:

- **Employer** pays 2% of gross salary into the employee's account.
- **Employee** pays a matching 2% of gross salary.
- **State** adds a further share by income band, tapering to nothing on higher incomes.

Enrolment is mandatory for employees who were under 40 when the scheme started in 2019, and voluntary for those who were older. Once enrolled, the 2% employer share and 2% employee share run on every monthly payroll. There is no upper salary ceiling on the employer and employee contributions themselves.

### No health levy, no 13th-month salary

The funded pension is the only social contribution in Georgian payroll. There is no employer or employee health insurance charge in the payroll stack. There is also no statutory 13th- or 14th-month salary. The form and amount of pay are set by the labour agreement, so any annual bonus is a contractual matter, not a legal requirement (Labour Code, art. 41).

## How does Teamed handle Georgia payroll for you?

Teamed becomes your legal [employer of record](/employer-of-record) in Georgia for [**from $599 per employee per month**](/pricing), with **zero FX mark-up** in any currency.

The flat 20% income tax withholding, the 2% funded pension, and the full Georgia employment law stack run on **one platform**.

**Real HR and legal experts** handle your Georgia hires, from the first offer letter through every monthly income tax declaration and pension remittance. **An actual person**, not a chatbot or a pooled queue. There is **no setup fee** and **no exit fee**. Employer cost **passes through at cost, itemised** on every invoice, so you see the 2% pension as its own line, never a blended figure.

EOR payroll, contractor onboarding, and entity setup all live on **one platform**. A Georgia contractor who converts to payroll keeps their record. That same employee can **graduate** from EOR to your own Georgia entity without switching systems. Run the [Employer Cost Calculator](https://www.teamed.global/tools/employer-cost) to see the full picture, including the flat 20% rate and the pension. EOR is the right model for a first Georgia hire, **until it isn't**. Start from [the Georgia hiring overview](/country-hiring-guides/georgia).

Key sources: [Tax Code of Georgia, Article 81(1)](https://www.matsne.gov.ge/en/document/view/1043717), the [Law of Georgia on Funded Pensions](https://www.matsne.gov.ge/en/document/view/4280127), and the [Labour Code of Georgia](https://matsne.gov.ge/en/document/view/1155567).

## Frequently asked questions

What does an employer pay in Georgia payroll taxes in 2026?

Georgia has no separate employer social security tax. The only employer payroll cost above salary is the funded pension, at 2% of gross salary. There is no employer health levy and no general payroll tax, which makes the loaded cost of a Georgian hire close to the headline salary.

What is deducted from a Georgia employee's salary?

Two deductions come off salary. Income tax is a flat 20%, withheld at source by the employer. The funded pension takes a further 2% of gross salary for enrolled employees. There is no separate employee social insurance charge.

What is the income tax rate in Georgia for 2026?

Georgia taxes salary income at a single flat rate of 20%, with no progressive bands and no tax-free allowance, under Article 81(1) of the Tax Code. The rate is the same for every salary level. Note that the US state of Georgia is a different jurisdiction with its own rate.

How does the funded pension work in Georgia?

The employer pays 2% of gross salary and the employee pays a matching 2%. The State adds a further share by income band, tapering to nothing on higher incomes. Enrolment is mandatory for employees who were under 40 when the scheme started in 2019.

When must Georgia payroll tax be filed and paid?

The employer files a monthly declaration with the Georgia Revenue Service covering the withheld income tax, and remits the funded pension to the Pension Agency on the same monthly cycle. Wages must be paid at least once a month, and late payment of wages carries a small daily charge on the overdue amount under the Labour Code.

Teamed Legal Operations

The thing employers get wrong about Georgia is expecting a European-sized social tax bill that never arrives. There is no separate employer social charge. Above the flat 20% income tax, the only payroll cost is the 2% funded pension on each side. The mistake runs the other way too. People assume the scheme is optional, then miss that enrolment is mandatory for younger workers from the first payroll.

A note from Tom Price-Daniel

Georgia taxes salary at one flat 20%, with no employer social tax behind it.  
The only contribution above income tax is the funded pension, 2% from each side, remitted monthly.  
Model the net before you make the offer.

Tom Price-Daniel · Co-founder, Teamed

## Related Georgia guides

- [Hiring in Georgia, overview](/country-hiring-guides/georgia)parent
- [Termination and severance in Georgia](/country-hiring-guides/georgia/termination-and-severance)sibling
- [Employer of Record overview](/employer-of-record)core
- [Pricing, Zero FX Fixed](/pricing)core
- [Employer Cost Calculator](https://www.teamed.global/tools/employer-cost)tool
- [Talk to an expert](https://www.teamed.global/contact)CTA

A note on this page.

This is a guide, not legal, tax or accounting advice. Rules change and vary by jurisdiction. Verify current requirements with the Georgia Revenue Service and the Pension Agency, or speak to a qualified professional, before relying on any specific framework. This page covers the country of Georgia in the Caucasus, not the US state of the same name. The funded pension scheme rules and State co-contribution bands are set by the Law of Georgia on Funded Pensions and may change.