Abkhazia is a partially recognized state on the eastern Black Sea coast, recognized as independent by Russia and a small number of other UN member states, while the United Nations and the majority of the world's governments consider it part of Georgia. Its economy runs on the Russian ruble and is substantially financed by Russian aid.
Abkhazia, a partially recognized state on the eastern Black Sea coast, taxes Abkhazian organizations on their profits under the 1994 framework law and taxes foreign organizations conducting business in Abkhazia through a permanent establishment or otherwise earning Abkhazia-source income at the same rates. The general corporate profits tax rate is 18%, with sector-specific rates for banking, insurance, brokerage, utilities, and duty-free retail described elsewhere on this page.
The tax year generally follows the calendar year, consistent with the individual 183-day residence test under Article 1 of the Law On Personal Income Tax. Specific corporate filing deadlines are not published in accessible English-language primary sources; confirm current deadlines directly with Abkhazia's tax authorities.
The general corporate profits tax rate is 18%, applying to Abkhazian organizations and to foreign organizations conducting business in Abkhazia through a permanent establishment or earning Abkhazia-source income. Sector-specific rates apply: banking activity 25%, insurance activity 20%, brokerage/intermediary operations and transactions 25%, communal (utility) services 10%, and duty-free ("Duty Free") shops 15%. Small and medium businesses may instead elect a simplified tax regime (УСН) or a special turnover-based tax (Спецналог) that replaces profit tax, VAT, property tax, and payroll-related social contributions with a single payment tied to revenue rather than profit.
Monthly income from any lawful activity is taxed at a flat 10% rate. An individual is treated as having permanent residence in Abkhazia for tax purposes if present in the country for more than 183 days in a calendar year (Article 1). Abkhazia-resident individuals are taxed on worldwide income, with a credit available for foreign tax paid on foreign-source income (capped at the Abkhazian tax otherwise due on that income); non-resident individuals are taxed only on Abkhazia-source income.
A single flat VAT rate of 10% applies, with no reduced or zero domestic rate tier identified beyond export relief. Enterprises that are not themselves the original producer receive a refund of VAT previously paid on goods manufactured in Abkhazia and subsequently exported, processed by the tax authorities within three days of written customs confirmation.
See Personal Tax Rate above for the individual 183-day residence test (Article 1, Law "On Personal Income Tax"). A legal entity is an Abkhazian taxpayer if it is an Abkhazian organization, or a foreign organization conducting business in Abkhazia through a permanent establishment and/or deriving Abkhazia-source income (Law "On the Tax on Profits of Enterprises and Organizations").
A foreign organization conducting business in Abkhazia through a permanent establishment, or otherwise deriving Abkhazia-source income, is treated as an Abkhazian taxpayer under the Law On the Tax on Profits of Enterprises and Organizations, subject to the same 18% general rate (or the applicable sector-specific rate) that applies to Abkhazian organizations; Abkhazia's 1994 framework tax law does not contain a codified PE test comparable to a full OECD Model treaty article, consistent with its closed-list, 1990s-era tax code structure described elsewhere on this page.
No CFC-style attribution provision was found in Abkhazia's tax legislation. Abkhazia's tax system is built on its 1994 framework law "On the Foundations of the Tax System in the Republic of Abkhazia" (Закон Республики Абхазия «Об основах налоговой системы в Республике Абхазия», No. 169-с of 8 September 1994), which enumerates a fixed, closed list of republican and local taxes - profit tax, VAT, excise, securities-transaction tax, customs duty, property tax, personal income tax, land tax, and a number of narrower local fees - with no provision among them addressing attribution of a foreign subsidiary's undistributed profits to an Abkhazian parent or resident shareholder. This is a smaller, closed-list tax code structurally different from Russia's own tax code (which does have a detailed CFC regime under Article 309.1 of the Russian Tax Code) - the two systems should not be conflated despite Abkhazia's close economic integration with Russia.
No thin capitalization ratio or related-party interest-deduction cap was found in Abkhazia's tax legislation, consistent with the same closed-list, 1990s-era statutory structure described above.
Abkhazia classifies entities under its own domestic 1994 framework tax law rather than offering an elective check-the-box system, and no ATAD2-style anti-hybrid mismatch regime addressing double-deduction or deduction-without-inclusion outcomes has been identified, consistent with the absence of a CFC regime described elsewhere on this page; Abkhazia's closed list of enumerated republican and local taxes has no provision addressing hybrid entity or instrument mismatches, a structurally smaller and less elaborate system than Russia's own tax code despite Abkhazia's close economic integration with Russia.
No domestic FBAR-equivalent regime requires Abkhazian residents to separately disclose foreign financial accounts, and Abkhazia is not a CRS participating jurisdiction, given its status outside the OECD framework as a partially recognized state. US persons remain independently subject to FinCEN Form 114 (FBAR) and potentially Form 8938 regardless of Abkhazia's own rules.
No dedicated participation exemption regime for dividends or capital gains from a qualifying subsidiary was identified in Abkhazia's closed-list tax code; confirm current treatment of intercompany dividends and share disposals directly with Abkhazia's tax authorities before relying on this page, consistent with the same 1990s-era statutory structure documented elsewhere on this page.
Abkhazia-resident individuals are taxed on worldwide income, with a credit available for foreign tax paid on foreign-source income, capped at the Abkhazian tax otherwise due on that income, per Abkhazia's Law On Personal Income Tax; the 2024 Abkhazia-Russia double tax treaty described elsewhere on this page provides the primary mechanism for double-tax relief on income connecting the two countries specifically, a general corporate-level unilateral foreign tax credit mechanism outside that single treaty relationship is not identified in Abkhazia's 1994 framework tax law.
Abkhazia has one confirmed comprehensive tax treaty: an intergovernmental agreement with Russia for the avoidance of double taxation and prevention of tax evasion with respect to taxes on income, signed in Sukhum on 7 May 2024 by Abkhazia's Deputy Prime Minister and Finance Minister Vladimir Delba and Russia's Deputy Finance Minister Alexei Sazanov, ratified by the Russian State Duma on 16 October 2024, and confirmed to take effect from 2025 - sourced directly from the Russian Ministry of Finance's own press release and the Russian Federation Council's official announcement. The treaty sets a uniform 10% source-country withholding rate on dividend and royalty income, with specific exceptions for state-owned entities, and separately exempts certain developers from profit tax under conditions set out in the agreement. No other country currently maintains a comprehensive bilateral tax treaty with Abkhazia, consistent with the very small number of states that recognize Abkhazia as an independent country.