Inheritance Tax in Georgia

Overview of Inheritance Tax Legislation

Georgia does not maintain a standalone estate tax, wealth tax, or specific inheritance tax regime. Transfers of property upon death are governed by the Tax Code of Georgia (TCG) under the Personal Income Tax (PIT) rules. This simplified framework makes the intergenerational transfer of real estate transparent and financially efficient for both domestic and international property owners.

Tax Treatment Based on Degrees of Kinship

Under Article 82 of the TCG, tax liability on inherited real estate or assets depends entirely on the degree of statutory kinship between the deceased (decedent) and the beneficiary:

• First and Second-Degree Relatives: Spouses, children, parents, siblings, grandparents, and grandchildren are 100% exempt from personal income tax on inherited real estate or monetary assets, regardless of the property's total market value.
• Third and Fourth-Degree Relatives: Aunts, uncles, nephews, nieces, and cousins receive an exemption on inherited property up to a aggregate value of GEL 150,000 per calendar year. Any value exceeding this statutory cap is taxed at the standard personal income tax rate of 20%.
• Unrelated Beneficiaries: Non-relatives receiving inherited real estate in Georgia do not qualify for kinship exemptions and are subject to the standard 20% Personal Income Tax on the fair market value of the acquired asset.

Non-Resident Heirs and Double Taxation

Foreign nationals inheriting real estate situated in Georgia are subject to Georgian tax jurisdiction regarding the property itself. Because Georgia levies zero inheritance tax on direct heirs, non-resident foreign beneficiaries do not incur Georgian income tax on such transfers. However, cross-border heirs must consider the tax laws of their own country of tax residence and any applicable Double Taxation Avoidance Agreements (DTAAs) to determine foreign reporting requirements or estate liabilities abroad.

Subsequent Sale of Inherited Property

When an heir decides to sell inherited residential real estate in Georgia, specific capital gains rules apply:

• Holding Period Exemption: Under Article 82 of the TCG, income from the sale of residential real estate owned by an individual for more than 2 years is completely exempt from the 20% personal income tax, provided the property was not utilized for business activities.
• Short-Term Sale Basis: If sold within 2 years of inheritance, tax is levied at 20% on the difference between the sales price and the property's tax basis established at the time of title transfer.

Administrative Transfer Process

Although direct heirs owe no inheritance tax, legal transfer of real estate requires obtaining a formal Certificate of Inheritance from a Georgian notary or an legalized/apostilled foreign probate court order. The title must then be officially registered at the National Agency of Public Registry (NAPR) at the Public Service Hall, incurring standard administrative processing fees.

A foreign investor owns a apartment in Tbilisi valued at USD 250,000. Upon the owner's death, the property is inherited by their child (a first-degree relative). Under Article 82 of the Tax Code of Georgia, the child pays 0% personal income tax on the acquisition. To complete the legal transfer, the child submits an apostilled inheritance certificate to the Public Service Hall and pays an administrative NAPR fee (typically between GEL {{data:napr_standard_fee}} and GEL {{data:napr_fast_fee}} depending on processing speed). If the child keeps the property for over two years before selling, any profit from the sale is also completely exempt from Georgian capital gains tax.