How your take-home pay is calculated
Salaries in Georgia are subject to two deductions: the funded pension contribution and personal income tax. Your employer withholds both from your gross salary and pays them on your behalf.
- Pension contribution — 2% of gross salary. It goes to your personal account in the Pension Agency's funded pension scheme.
- Income tax — 20% of what is left. The pension contribution is excluded from taxable income, so the tax is charged on the gross salary minus the 2%.
- Take-home pay is the gross salary minus both.
In one line: take-home = gross × 0.98 × 0.80 = gross × 0.784. For someone outside the pension scheme it is simply gross × 0.80.
Worked examples
A gross salary of 1,000 ₾, in the pension scheme:
| ₾ | |
|---|---|
| Gross salary | 1,000.00 |
| Pension contribution (2%) | −20.00 |
| Income tax (20% of 980) | −196.00 |
| Take-home pay | 784.00 |
A gross salary of 2,500 ₾ leaves 1,960.00 ₾ in the scheme (50 ₾ pension, 490 ₾ tax), or 2,000.00 ₾ outside it (500 ₾ tax).
You want 2,000 ₾ in hand. The gross salary needed is 2,551.02 ₾: 51.02 ₾ goes to your pension and 500.00 ₾ is income tax.
What goes into your pension account
On top of your own 2%, your employer adds 2% of your gross salary and the state adds up to 2%: 2% on the first 24,000 ₾ of salary per year and 1% on the part up to 60,000 ₾. On a 2,500 ₾ monthly salary that is 50 ₾ from you, 50 ₾ from your employer and about 45 ₾ from the state — 145 ₾ a month saved in total. The calculator shows these amounts below your take-home pay.
Who is in the pension scheme
Taking part is mandatory for employees who are Georgian citizens, and for foreigners and stateless persons with a permanent residence permit. People who were already 40 or older when the scheme started in 2019 could choose to leave it. Foreign employees without permanent residence are outside the scheme: for them, only the 20% income tax applies.
What this calculator doesn't cover
It applies the standard rates. Some people — for example those with certain disabilities or other statuses listed in the Tax Code — are entitled to an income tax exemption, and income other than salary (rent, dividends, small business turnover) is taxed under different rules. If your situation is special, check with the Revenue Service or an accountant.