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Foreign Bank Account

by ads.georgialegalservice
Foreign Bank Account. 2022

Foreign Bank Account: Can be used by: IEs

You can legally continue to accept your IE income to any foreign bank account.

However, it should be noted that, if you are accepting income to your foreign business account (if you already had a business registered abroad before registering in Georgia), then this can potentially lead to a whole host of other tax issues, depending on the type of business. You can read more about the tax pitfalls of transacting through your foreign business while actively managing it from Georgia in our other article.

Assuming your foreign account is a personal account, or an account linked to you as an individual and not to a legal entity you own, then the following information is worth considering.

You can accept business income to that account without any special rules or restrictions on the Georgian side. Obviously, that income must be declared here if it is tax liable (Read more about foreign source income here).

BUT tax liability for that income in the country where the bank account is held can vary. It’s worth discussing any tax implications with an adviser based in that country, especially if that country does not have a double tax treaty with Georgia.

It’s important to note that tax liability is never based on the location of remittance when it comes to Georgian taxation. It is based on liability of the business or individual. This means that the mere fact that funds don’t arrive to a Georgian bank account is never a basis for these funds not being taxed.

Paypal

A foreign PayPal account, for tax purposes, would be treated the same as any other foreign bank account.

A Georgian PayPal account would be treated the same as any other Georgian online bank account.

The main things to know about PayPal in Georgia:

Accepting credit card payments is almost impossible. So, for online payment processing, tools like PayPal or Stripe are a non-starter (we hope this will change soon).

Getting money out of PayPal to a bank account is difficult and involves connecting a Visa card (not MasterCard) to the account, and withdrawing funds to the card, not to the bank account. Users report mixed results with making this work reliably.

PayPal has horribly high fees in general. Which, if you have used it for international business in the past, you probably know already. If you have only ever dealt with one currency, in one country, then you may not be aware of just how overpriced PayPal can get.

Other online payment processors, like Stripe, are simply not available in Georgia yet. More info on this below.

Which Physical Georgian Bank Should I Use?

If you want to open a personal or corporate account locally, there are quite a few options. Bank of Georgia and TBC are two of the largest commercial banks in the country, as well as the most popular choices with foreigners.

In most circumstances, it makes sense to open your personal bank account and business bank account with the same bank, so that your accounts are linked.

Bank of Georgia (& Solo Bank)

Bank of Georgia (or BoG) has a significant presence nationwide, featuring both physical locations where you can get your banking done in-person, as well as a modern and easy to use online banking portal and app.

In terms of business banking, BoG is probably the hardest to get accepted to, but the easiest to work with once you have been accepted.

Solo Bank is the premium arm of Bank of Georgia, for personal banking only. Their reasonable annual fee comes with a host of benefits, including a personal banker who can assist you with many banking activities remotely, so that you don’t even need to visit a branch.

They will also speak better English than most of the front desk staff in regular branches, making your life much easier. Another major benefit to Solo is the ability to conduct banking operations over email, rather than having to go to a branch or complete endless SMS verifications.

TBC

TBC offers most of the same services that Bank of Georgia does. Anecdotally, they are slightly more hasty in blocking large payments from abroad. Every foreigner will have a different story though, and we have no concrete reason to recommend BoG over TBC.

Other Options

Beyond these main two options, you might also check out VTB, ProCredit, and Liberty Bank. Be prepared for one typical question that the smaller banks will ask: “Why did you choose our bank?” You do not want your answer to be, “The other banks rejected me.”

Contact our legal advisors in Georgia. and we will help you register a business in Georgia online.

 

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