If a taxpayer is found to have a tax debt, which may have arisen as a result of a tax audit and has not been reduced even after going through the stages of tax disputes, they have the right to apply to the Revenue Service for a tax agreement.
A tax agreement may be signed between the Revenue Service and the taxpayer to reduce the tax debt and/or part of it, which means that as a result of the agreement, the taxpayer will pay a certain amount of money within a specific period, and the remaining part will be written off.
The taxpayer applies to the Revenue Service with an application for the conclusion of a tax agreement, which, in turn, is authorized to refuse the tax agreement or to submit the application, along with the attached materials, to the Minister of Finance of Georgia for consideration at a session of the Government of Georgia.
The decision on the conclusion of a tax agreement is made by the Government of Georgia, which determines the amount of money that must be paid by the taxpayer in accordance with the tax agreement and within what period. The taxpayer is obliged to pay the amounts stipulated in the agreement within the period determined by the Government of Georgia.
After signing a tax agreement, the Head of the Revenue Service is authorized to cancel/not apply measures to secure payment of tax debts.
After fulfilling the conditions stipulated by the tax agreement, the taxpayer’s tax debt is reduced. However, if the taxpayer fails to fulfill the obligations stipulated by the tax agreement within the established period (i.e. does not pay the amounts specified in the agreement within the appropriate deadlines), the tax agreement will be canceled and the taxpayer will be charged a penalty of 10%. This means that the taxpayer will have to pay the old debt amounts again from the beginning, plus an additional penalty for violating the tax agreement.
After signing a tax agreement, it is not permitted for the payer to adjust the declarations for the agreed period in order to reduce the amounts and/or for the tax authority to verify the period under review and impose additional sanctions.
The procedure for concluding a tax agreement is determined by the Government of Georgia.
See link: matsne.gov.ge
