Georgia Surplus Lines Tax: Rate, Deadlines, and Penalties

Georgia’s surplus lines tax is a 4% privilege tax on premiums placed with unauthorized insurers, and the licensed surplus lines broker is the one who owes it. You calculate it on the quarterly premium (less return premiums and less any amounts collected for other state or federal taxes), file a sworn affidavit with the Commissioner of Insurance, and remit the money on four fixed dates each year. Miss the deadline by more than 30 days and penalties start accruing at $25 per day, capped at 100% of the unpaid tax.1Justia. Georgia Code 33-5-31 – Payment by Broker of Tax for Privilege of Doing Business in This State2Justia. Georgia Code 33-5-32 – Penalty for Failure to File Quarterly Affidavit or Remit Tax Within Time Prescribed by Law

How the 4% Tax Is Calculated

The tax base is the total premium the broker received during the quarter, minus return premiums and excluding any amounts collected to cover other state or federal taxes.1Justia. Georgia Code 33-5-31 – Payment by Broker of Tax for Privilege of Doing Business in This State The broker is the taxpayer. If the broker collects the premium but never remits the tax, the liability stays with the broker, not the insurer and not the insured.

For a risk located entirely in Georgia, the math is straightforward: 4% of net premium. Multi-state risks work differently. When Georgia is party to a cooperative agreement or compact with other states under O.C.G.A. 33-5-40 through 33-5-44, the broker applies Georgia’s 4% rate to the premium allocated to Georgia and each other state’s rate to premium allocated to that state.1Justia. Georgia Code 33-5-31 – Payment by Broker of Tax for Privilege of Doing Business in This State This tracks the Nonadmitted and Reinsurance Reform Act framework, under which only the insured’s home state collects surplus lines tax on multi-state policies.

Quarterly Filing Deadlines

Georgia surplus lines brokers file a quarterly affidavit covering every transaction in which premium was received during the preceding quarter. Each entry has to include the certificate or cover note number, the insured’s name, the premium amount, and the tax paid on that transaction. The Commissioner can require additional information beyond those minimums.3Justia. Georgia Code 33-5-29 – Filing of Quarterly Affidavits by Surplus Line Brokers; Filing of Reports of Affairs and Operations by Brokers

The due dates are fixed calendar dates:

Tax payment must accompany the affidavit. Filing without paying, or paying without filing, does not satisfy the obligation.1Justia. Georgia Code 33-5-31 – Payment by Broker of Tax for Privilege of Doing Business in This State

Filing Through SLIP

All non-admitted insurance filings go through the Surplus Lines Information Portal (SLIP). Georgia moved fully to SLIP in April 2022. Brokers who used the older GIMS Portal for policies written before January 2021 can still handle endorsements and returns on those legacy policies in GIMS, but any policy that renews has to be filed in SLIP going forward.5Office of the Commissioner of Insurance and Safety Fire. Non-Admitted Insurance

The Commissioner can also require reports on the broker’s affairs and operations related to Georgia insureds, for whatever time periods the Commissioner specifies.3Justia. Georgia Code 33-5-29 – Filing of Quarterly Affidavits by Surplus Line Brokers; Filing of Reports of Affairs and Operations by Brokers Transaction records need to be kept and available when requested.

Penalties for Late Filing or Non-Payment

The penalty clock does not start on the due date. It starts 30 days after. If a broker still has not filed the affidavit or remitted the tax by then, the penalty is $25 for each day of continued delinquency or 100% of the unpaid tax, whichever amount is less.2Justia. Georgia Code 33-5-32 – Penalty for Failure to File Quarterly Affidavit or Remit Tax Within Time Prescribed by Law

The “whichever is less” cap changes which figure controls. On a small tax balance, 100% of the tax hits quickly and becomes the ceiling. On a large balance, $25 per day is usually less than 100% of the tax, so the daily accrual becomes the effective penalty. In either case, the penalty can double the total owed.

The statute gives the Commissioner one release valve: a reasonable extension of time for good cause shown.2Justia. Georgia Code 33-5-32 – Penalty for Failure to File Quarterly Affidavit or Remit Tax Within Time Prescribed by Law The statute does not define good cause, which leaves the call to the Commissioner. If you know a deadline is going to slip, request the extension before the due date rather than after.

Separately, O.C.G.A. 33-2-24 gives the Commissioner authority to fine any insurance licensee up to $2,000 per violation of the Insurance Code, or up to $5,000 per violation if the licensee knew or reasonably should have known about it.6Justia. Georgia Code 33-2-24 – Enforcement of Title and Rules and Regulations of Commissioner These per-violation fines can stack on top of the late-filing penalty. On a busy book, where each unreported transaction can be treated as a separate violation, the exposure adds up fast.

Suspension or Revocation

Under O.C.G.A. 33-23-21, the Commissioner can suspend or revoke any insurance license when the licensee has violated a provision of the Insurance Code, failed to comply with a Commissioner order, or failed to produce records on demand.7Justia. Georgia Code 33-23-21 – Grounds for Refusal, Suspension, or Revocation of License Repeated failure to file the quarterly affidavit or remit the tax falls within those grounds. If an investigation shows that tax funds were converted to personal use or withheld from the insurer or insured, the matter can move beyond regulatory discipline into criminal territory.

Direct Procurement Tax: A Separate Obligation

The 4% broker tax is not the only surplus lines tax in Georgia. When an insured procures coverage directly from an unauthorized insurer without going through a licensed surplus lines broker, the insured owes a direct procurement tax under O.C.G.A. 33-5-33. The insured has to file a written report with the Commissioner within 30 days of procuring, continuing, or renewing that coverage, identifying the insured, the insurer, the type of coverage, and the premium, and remit 4% of the gross premium with the report.8FindLaw. Georgia Code Title 33 Insurance 33-5-33

Multi-state allocation works the same way as under the broker tax. The penalty structure does not: a delinquent direct procurement tax accrues interest at 6% per year, compounded annually, rather than the $25-per-day broker penalty.8FindLaw. Georgia Code Title 33 Insurance 33-5-33 Slower, but it compounds, and the obligation does not disappear.

Return Premiums Come Back as Credits, Not Refunds

Georgia does not refund surplus lines tax that has already been paid. Return premiums and premium adjustments are handled as credits against premium reported on a later quarterly affidavit.9Office of the Commissioner of Insurance and Safety Fire. Non-Admitted Insurance Premium Tax FAQs If a policy cancels mid-term and produces a return premium, the credit shows up in the next quarter’s filing. Miss the adjustment and no check comes in the mail to correct it.

What Falls Outside the Tax

Two narrow categories of coverage sit outside the surplus lines framework under O.C.G.A. 33-5-35: insurance on property or operations of railroads engaged in interstate commerce, and insurance on aircraft owned or operated by aircraft manufacturers or operated in scheduled interstate flight (including cargo and liability coverage other than workers’ compensation and employer’s liability). The exemption also covers reinsurance.10Justia. Georgia Code 33-5-35 – Applicability of Article Everything else runs through the full framework, regardless of the size of the risk or the sophistication of the insured.