The three-question decision tree
You don’t need a long comparison matrix to pick the right structure. You need three yes/no questions answered in order:
- Are you the only founder? No → LLC. Yes → continue.
- Do you expect annual revenue clearly above 500,000 GEL?Yes → LLC. No → continue. “Maybe” → standard IE for the year, then convert to LLC.
- Do you expect outside investment, significant hires, or an acquisition? Yes → LLC. No → SBS.
That’s the decision in 30 seconds. The longer answer follows.
Worked tax-cost examples
Three foreign founders, identical revenue, identical 20% deductible business costs[1]:
Founder A — 50,000 GEL/year revenue, single founder:
- LLC (no distribution): 0 GEL
- LLC (full distribution of post-cost profit, 40K): 6,000 GEL
- Standard IE: 8,000 GEL (20% × 40K)
- Small Business Status: 500 GEL (1% × 50K) — winner
Founder B — 250,000 GEL/year revenue, single founder:
- LLC (no distribution): 0 GEL
- LLC (full distribution of post-cost profit, 200K): 30,000 GEL
- Standard IE: 40,000 GEL
- Small Business Status: 2,500 GEL — winner, dramatically
Founder C — 750,000 GEL/year revenue, single founder:
- LLC (no distribution): 0 GEL deferred — winner if reinvesting
- LLC (full distribution of 600K post-cost profit): 90,000 GEL
- Standard IE: 120,000 GEL
- SBS: not available — over threshold
The crossover point: SBS dominates under 500,000 GEL of revenue. Above 500,000 GEL the LLC dominates, especially when reinvesting profit (the Estonian-style CIT model means retained earnings are tax-free until distribution).