Hiring at a Glance

Georgia boasts a very business-friendly hiring environment with flexible labor laws and low tax burdens. It uses a simple, flat-tax payroll system: employers typically withhold a flat 20% income tax from wages and contribute nominal social charges (around 2–5%). The minimum wage is extremely low (just GEL 20/month as of 2025), reflecting a low baseline labor cost. Importantly, the EOR model is attractive in Georgia because entity setup is fast and inexpensive; an EOR can handle contracts, payroll and local compliance for you. The Georgian labor code generally allows employment termination with minimal restrictions, making it straightforward to hire or dismiss staff legally.

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Key Talent Market Characteristics

Georgia’s workforce is young, competitive, and increasingly technology-oriented. Key features include:

• Flexible Regulations: Georgian labor law is relatively liberal – for example, there is no mandatory notice period for terminations under 1 year of service, and fixed-term contracts are common. Overtime pay is defined but less administratively burdensome than in Western Europe.
  
• Cost-Competitive Salaries: Average wages in Tbilisi are modest (around GEL 2,200–2,300/month in 2025), enabling cost-effective hiring.
  
• Growing Tech Sector: The government promotes IT education and startups, so tech and financial roles are on the rise. Many young professionals speak English.
  
• Low Tax Burden: Georgia’s flat 20% personal income tax (PIT) and minimal employer contributions (roughly 2% to pension and minor insurance) attract investment. The World Bank ranks Georgia highly for ease of doing business.
  
  

In-Demand Skills (2026)

As the economy diversifies, in-demand positions include: software developers (full-stack, mobile, web), quality assurance engineers, data analysts/scientists, cloud specialists, and roles supporting business services (customer support, accounting). Tech and finance continue to dominate:

• Software & Web Developers (especially in Java, .NET, Python)
  
• QA/Test Engineers and DevOps
  
• Data Analysts/Scientists
  
• Cybersecurity Specialists
  
• Customer Support & Back-Office (BPO/KPO) Staff
  

Many outsourcing companies also seek multilingual skills (English, Russian, regional languages).

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Top Universities Supplying Talent

Georgia’s leading universities produce most of its professional workforce. Key institutions are Tbilisi State University (TSU), Ilia State University, Georgian Technical University, and Caucasus University. TSU and Ilia specialize in sciences and liberal arts; Technical University graduates provide much of the engineering and IT talent. Firms often recruit interns and co-ops from these schools in ICT and engineering departments.

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Salary Benchmarks (Annual, GEL)

Salaries in Georgia are lower than Western Europe but rising. Approximate gross ranges:

• Software Engineer: 60,000–120,000 GEL
  
• Data Analyst: 50,000–90,000 GEL
  
• Accountant/Finance: 40,000–80,000 GEL
  
• Project/Operations Manager: 70,000–130,000 GEL
  

These figures vary by experience and company size, with the upper end for senior tech or managerial roles.

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Employer of Record vs Legal Entity Setup in Georgia

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Legal Requirements to Hire

To legally employ workers in Georgia, an employer must:

• Register a Company: Incorporate through Georgia’s Public Registry. Incorporation is fast (often 1–2 days) and inexpensive.
  
• Obtain Tax Registration: Register for tax purposes with the Revenue Service (Tax Identification Number). Employers must withhold employee PIT at 20%.
  
• Draft Employment Contracts: Prepare written contracts in accordance with the Labor Code. All employees must sign an employment contract specifying duties, compensation, and conditions. The contract is mandatory and should be in Georgian or a language the employee understands.
  
• Social Contributions (BPJS equivalent): Georgia requires employers to contribute to pension/medical funds (about 2–5% of salary) and withhold 2% from employees. Recent reforms introduced private pension plans (2% each by employer and employee for residents).
  
• Labor Code Compliance: Comply with core provisions (e.g. max 40-hour workweek, at least 4 weeks paid leave per year).
  

Foreign companies can often secure a legal entity and start hiring within weeks. An EOR simplifies this by handling registrations and ensuring payroll legalities are met.

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Cost of Entity Setup

Georgia offers low setup costs: legal fees for incorporation may be a few hundred dollars and annual renewal fees are minimal. There are no substantial capital or licensing requirements for most service companies. Consequently, using an EOR (which bypasses entity costs) is often chosen for faster entry. Even with a local entity, ongoing administrative costs are modest compared to Western Europe. Notably, despite low taxes, Georgian law does mandate certain severance and termination payments, which can drive up employer costs for long-term employees (see below). Overall, Georgia is one of the cheapest countries in Europe to establish and run payroll, making it ideal for testing new markets.

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What Hiring Through an EOR Means in Georgia

An Employer of Record (EOR) in Georgia becomes the legal employer registered with Georgian tax and labour authorities, while the employee works exclusively for your company. You retain operational control over work and performance, while the EOR assumes responsibility for all employer obligations under Georgian labour and tax law.

Georgia is one of the most employer-flexible labour markets in Europe/Asia, governed by a modernised Labour Code that allows broad contractual freedom, simple termination, and minimal mandatory benefits. However, foreign companies still cannot legally employ staff without:

• A Georgian employing entity
  
• Payroll and tax registration
  
• Compliance with Georgian contract and tax rules
  

An EOR provides this employer infrastructure without requiring you to establish a Georgian company.

An EOR in Georgia handles:

• Labour Code–compliant employment contracts
  
• Payroll processing in GEL
  
• Flat personal income tax withholding
  
• Pension scheme contributions (if applicable)
  
• Employment registration where required
  
• Work permit and residence permit support for foreigners
  
• Termination handling
  
• Classification compliance
  

This model works best for companies that want to hire in Georgia quickly while leveraging its highly flexible employment regime without setting up an entity.

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Risk Involved in Both Models

Georgia’s employment system is contract-driven, not protection-heavy.

Key characteristics of Georgian labour compliance:

• Written contracts required
  
• Few mandatory benefits
  
• No universal social security burden like EU states
  
• Termination allowed with minimal restriction
  
• Low inspection frequency
  

Compliance failures mainly relate to:

• Tax under-withholding
  
• Contract clarity disputes
  
• Immigration compliance for foreigners
  

In Georgia, payroll and immigration errors are more risky than termination decisions.

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EOR Vs. Entity: When to use What?

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Why is an EOR the Most Efficient Way to Hire in Georgia?

Georgia offers access to tech, engineering, support, and multilingual talent with one of the lightest employment burdens in the region.

An EOR is not just payroll support. It is the legal employer, responsible for:

• Labour Code compliance
  
• Payroll and tax filings
  
• Contract enforceability
  
• Immigration processing
  

This lets you benefit from Georgia’s flexible labour market without handling entity setup or payroll infrastructure.

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#1. EOR Leverages Georgia’s Flexible Termination Framework

Unlike EU markets, Georgia allows broad termination freedom.

Key features:

• Termination allowed with notice or compensation
  
• No mandatory severance regime like Western Europe
• Termination grounds often contractual

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#2. EOR Eliminates Payroll & Flat-Tax Errors

Georgia’s employment cost is driven by:

• Flat 20% personal income tax
• Low mandatory employer charges

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Incorrect payroll mainly causes:

• Tax penalties
  
• Employee pay disputes
  

EOR payroll systems are built on Georgia-specific flat-tax logic.

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#3. EOR Controls Immigration Risk for Foreign Staff

Foreign employees must comply with:

• Work/residence permit rules
  
• Registration timelines
• Visa conditions

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#4. EOR Avoids Entity Setup Despite Low Barriers

Georgia is easy to incorporate in, but entity setup still requires:

• Tax registration
  
• Accounting
  
• Payroll setup

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EOR vs. PEO in Georgia: How to Decide the Right Hiring Model?

A PEO in Georgia cannot legally employ workers. A Georgian entity is required.

• PEO: HR/payroll support only
  
• EOR: Legal employer

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Key question:

Do you want to run payroll and contracts yourself in Georgia?

If not, EOR is the simplest path.

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Payroll, Taxes, and Monthly Compliance

Georgia’s payroll process is relatively simple:

• Withholding: Employers withhold a flat 20% PIT from each employee’s salary. Contributions (such as 2% pension) are also deducted from payroll.
  
• Employer Contributions: In addition, employers pay roughly 2% on top of wages towards social insurance. These cover general insurance and pension funds. Overall employer-side costs remain low (~22% total labor burden).
  
• Reporting: Each pay period (usually monthly) must be reported electronically to the tax authority. Employers file detailed payroll tax declarations and annual tax reports. Payments for tax and social contributions are made through government channels on a monthly basis.
  
• Payslips & Records: Provide a payslip showing gross pay, deductions (tax, pension), and net salary. Maintain payroll and time records for 10 years.
  

Compliance is straightforward because rates are flat and defined by law. However, employers must be careful to correctly apply all obligations – e.g. ensuring timely PIT remittance and pension filings – to avoid fines. Georgian law treats non-compliance seriously, though enforcement is generally less punitive than in Western Europe.

Common Compliance Pitfalls: While Georgia’s system is simpler, mistakes do occur:

• Improper Documentation: Failing to use formal written employment contracts can lead to disputes. Georgia mandates signed contracts for all employees.
  
• Tax Errors: Under-reporting wages or misfiling PIT (20%) can incur penalties. Georgia’s flat tax simplifies things, but employers must still withhold and remit correctly.
  
• Benefit Misclassification: Georgia has minimal mandated benefits, so errors often come from misunderstandings (e.g. treating a contractor as an employee).
  
• Severance Miscalculation: Although relatively low, severance pay can catch companies off-guard. The law requires severance and termination payments (depending on tenure), which can amount to 1–2 months’ salary per year of service for dismissals. For example, involuntary terminations may require “two times severance and one time gratuity” per year of service. Miscomputing these (or mixing up voluntary vs. involuntary) is a common risk.
  
• Undervalued Benefits: Georgia has no mandatory 13th salary, but leave entitlements (24 workdays per year) must be honored. Forgetting leave payouts or averaging pay incorrectly for irregular hours can cause issues (similar to holiday pay errors elsewhere).
  

An EOR handles these by applying the correct formulas for termination pay and by ensuring all statutory withholdings and benefits are processed properly.

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Monthly Payroll Operations

A typical monthly payroll run in Georgia entails: calculating each employee’s gross salary, deducting 20% PIT and any required pension contributions, and arriving at net pay. The EOR then remits the tax and insurance payments to Georgian authorities. The EOR issues payslips and handles annual compliance (e.g. tax filings, preparation of the Form NDFL90 for employees). Because the system is largely flat-rate, an EOR’s software can automate most calculations, reducing manual errors. This leaves clients free to focus on work content and employee performance, while all Georgian payroll and compliance are managed by local experts.

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Step-by-Step Onboarding Process With an EOR in Georgia

Hiring in Georgia is straightforward but still requires proper documentation.

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1. Confirm Tax-Registered Employer

Verify that the EOR is registered with Georgian tax authorities.

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2. Validate Role & Contract Structure

Confirm duties, salary, notice, and termination terms.

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3. Request a Full Cost-to-Company Breakdown

Includes:

• Gross salary
  
• Income tax
  
• Pension contributions
  
• EOR fee
  
  

4. Initiate Immigration Process (If Foreign Hire)

EOR manages:

• Visa selection
  
• Residence/work permit
  
• Renewals
  
  

5. Generate Labour Code–Compliant Contract

Contract reflects:

• Georgian Labour Code
  
• Notice and termination terms
  
• Salary structure
  
  

6. Register Employee for Payroll

EOR registers the employee for tax and payroll reporting.

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7. Run Payroll & Maintain Compliance

EOR manages:

• Monthly payroll
  
• Tax filings
  
• Immigration tracking
  
  

Build Your Georgia Team with Bolto EOR

Expanding into Georgia is fundamentally a tax and contract exercise, not a heavy labour-law challenge.

Bolto’s Employer of Record model absorbs that complexity so you can hire in Georgia without becoming the legal employer or running payroll yourself.

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Local Compliance, Fully Managed

Bolto handles:

• Contracts
  
• Payroll and tax
  
• Immigration
  
• Authority interactions
  

You control work and output, Bolto carries employer liability.

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Hire Without Entity Setup

With Bolto EOR, you can:

• Hire in weeks
  
• Test Georgia as a market
  
• Scale or exit without entity setup
  
  

Transparent Costs

All statutory and employment costs are shown upfront.

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Full Employee Lifecycle Support

From onboarding to termination, Bolto manages the lifecycle.

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Built for Fast, Low-Risk Expansion in Georgia

Georgia rewards flexible employers and penalises payroll mistakes not termination. Bolto’s EOR model enables growth without inheriting tax and admin risk.