Frequently asked questions about Georgia VAT
What is VAT?
VAT is the abbreviation of Value Added Tax. VAT is in general due when goods and/or services are sold. It applies to most goods and services supplied for use or consumption in Georgia. VAT is a consumption tax because it is ultimately borne by the final consumer.
Who must pay VAT?
Generally, VAT is invoiced by the supplier that is selling goods or services and collected from the customer. Subsequently, the supplier reports and remits the collected VAT to the tax authorities.
Where foreign taxable persons (such as Zoom) provide digital services to be used in the territory of Georgia by natural persons (non-business customers), there is a requirement for Zoom to collect and remit VAT. The responsibility to collect and remit VAT depends on whether the Georgian customer is a business customer or not.
If you are a business customer (including individual entrepreneurs), you should provide Zoom with your Tax ID. If you are a business customer and provide a valid Tax ID, then no VAT will be charged on the supplies made to you by Zoom; however, you may be required to self-assess for the VAT under the “reverse charge” mechanism. If you are not a business customer, or if you are a business customer but fail to provide a valid Tax ID, VAT will be charged on invoices issued to you by Zoom.
Why am I being charged VAT?
Zoom is registered as a non-resident VAT taxpayer in Georgia. As such, Zoom is required to collect and remit VAT on supplies of digital services made to non-business customers.
What is a Tax ID?
A Tax ID or VAT registration number is a universal tax identification number issued to businesses and individuals in Georgia. For business i.e., legal entities, the Tax ID is a 9-digit number. For individuals (including individual entrepreneurs) the Tax ID is an 11-digit number.
How do I enter my Tax ID?
To provide your Tax ID, follow the steps below depending on where your billing portal is located in the left navigation menu of the Zoom web portal. Not sure how to identify where your billing portal is located? Learn how to locate your billing settings.
Zoom performs periodic validation checks of customer Tax IDs to ensure that the Tax ID remains valid. If, during these periodic validations, it is identified that your Tax ID is no longer valid, Zoom may automatically update your account so that future invoices are subject to VAT. Where this happens, VAT will be charged on all future invoices until such time that a valid Tax ID is provided.
You are required to notify us if there is a change to your VAT registration status.
- Sign in to the Zoom web portal.
- In the navigation menu, click Plans and Billing then Billing Management.
- In the Contact Information section, click Edit.
- If selected, clear the Not VAT Registered check box.
Note: If you are an individual entrepreneur and your Tax ID is 11 digits, select the Not VAT Registered check box and submit a request to Zoom Support to update this information in Zoom’s billing system as additional information is required to validate your tax status. - Enter your VAT Number.
- Click Save.
- Sign in to the Zoom web portal.
- In the navigation menu, click Account Management then Billing.
- Click the Billing Information tab.
- To the right of Sold To Contact, click Edit.
- If selected, clear the Not VAT Registered check box.
Note: If you are an individual entrepreneur and your Tax ID is 11 digits, select the Not VAT Registered check box and submit a request to Zoom Support to update this information in Zoom’s billing system as additional information is required to validate your tax status. - Enter your VAT Number.
- Click Save Changes.
Does Zoom have a Georgian Tax ID/VAT registration number?
Yes, Zoom’s Tax ID will be displayed on invoices issued to you.
How is Zoom determining which customers VAT applies to?
If a customer's ‘Sold To’ location is in Georgia and the customer is not a business customer/has not provided a valid Tax ID, Zoom will charge Georgian VAT on its invoices.
This information is subject to cross-referencing against other data to verify that the ‘Sold To’ country is accurate.
It is your responsibility as a customer to ensure that your ‘Sold To’ address is accurate.
Is there a minimum threshold purchase amount before VAT is applied?
No, where supplies are made to natural persons (non-business customers), Zoom will charge VAT on all supplies made to you.
Are there any VAT obligations for me as a customer?
If you are a business customer (including individual entrepreneurs) and have provided a valid Tax ID to Zoom, no VAT will be charged on the supplies made to you. However, you may be required to report the purchase and self-assess for the VAT under the “reverse charge” mechanism in your VAT return. There is no VAT obligation for natural persons (non-business customers).
What if I have a Tax ID and forget to enter it?
Your Georgian Tax ID can be entered at any time. If entered before the next invoice, Zoom will not charge VAT on the next invoice or future invoices issued to you. If no Tax ID is entered at the time the next invoice is issued, VAT will be charged until a valid Tax ID is provided.
If a valid Tax ID is entered and VAT has previously been charged on the invoices issued to you, then upon request by you, Zoom may refund for any VAT included on invoices issued in the thirty days prior to a valid Tax ID being provided.
Decision tree – My “Sold To” address is Georgia; will I be charged VAT?
Disclaimer
Every customer is unique and so are their specific tax circumstances. The above stated information should not be considered as tax advice, but as a general overview of relevant VAT rules in Georgia. Zoom cannot provide you with tax advice for your individual situation, and therefore we strongly recommend speaking with a professional tax advisor for tailored advice.