New financial reporting requirements will affect Georgian enterprises in 2021. For those affected, reports must be submitted before October 1st, 2021, and will relate to the reporting tax year of 2020 (and 2019 where applicable). The reporting requirement will apply in every subsequent year going forward.

Below, we outline what will need to be submitted along with the criteria under which you can decide if your enterprise will be affected or not. The main governing legislation is the Law of Georgia on Accounting, Reporting, and Auditing.

Will The New Financial Reporting Requirements Apply To Your Enterprise?

Any IE (Individual Entrepreneur) who carries on economic activity which exceeds two out of three thresholds in any single category (from categories 1 to 3 shown below), will be placed in that category and required to submit the relevant reports for that category. 

All legal entities (LLC / JSC etc.) will be required to submit reports based on which category they are in, based on meeting 2 out of 3 of the criteria in that category.

In a nutshell, IEs that satisfy 2 or 3 criteria only for category 4 will not have to submit any reports under these rules. Legal entities will always have to submit reports. The type of reporting required will be determined by the category into which you fall.

The criteria are as follows:

CategoryAssets (GEL)Revenue (GEL)Avg. Number Of Employees

What To Report/Submit

  • Balance sheet.
  • Profit & loss statement.
  • Cash flow statement (optional for category 4 enterprises).
  • Signed PDF copies of all of the above* (only for category 1, 2, & 3 enterprises).

*Note: For category 1 & 2 enterprises the PDF reports must be signed by a company director and all statements must have been fully audited by a licensed auditor (Art. 2.1.e, 9.2). For category 3, it is not required for the documents to be audited, and they can simply be signed by a responsible person (such as the company accountant).

How And When To Report

From 2020 (reporting year), all those meeting the above-explained criteria must submit the relevant reports for their category before October 1st following the reporting year, and for each subsequent year. So, for the reporting year of 2020, the deadline is September 30th, 2021.

Prior to 2020, category 4 enterprises were not required to report (Art. 6.1). This is the major new change.

Reports are submitted through the special portal,, along with any required signed PDF versions of those reports.

Your accountant can assist you with the required documentation and the submission process.


Failure to submit by the deadline will lead to the following fines:

  1. A) Fourth category enterprise – in the amount of 500 GEL;
  2. B) Third category enterprise – in the amount of GEL 1,000;
  3. C) Second category enterprise – in the amount of GEL 5,000.

After missing the deadline, in addition to the initial fine, another deadline (from 1 to 6 months) will be given, and failure to submit financial statements within that revised period will result in a fine of double the amount of the original fine imposed.

We are ready to help you with all of the above reporting requirements. If you need assistance with mandatory financial reporting, check out our services.

Additional Technical Details

This section is only relevant if you want to check our reasoning for the above information.

Based on the Law of Georgia on Accounting, Reporting, and Auditing (referred to as “the Law” hereafter), Subjects are obligated to submit their financial statements to SARAS by October 1st of the year following the reporting period.

Art. 6.1 of the Law

Moreover, transitional provision of the Law states that 4th category Subjects shall also have to submit their financial statements in accordance with the general rule, starting from the reporting period ending on 31st December 2020 (i.e., the first reporting obligation is by 1st October 2021).

Art. 2.1.s, 28.12 of the Law

Based on the definition provided by the Law, Subjects shall be “legal entities of public law and private law, except for the budget organization defined by the Budget Code of Georgia and the National Bank of Georgia, branch of enterprise of another country, individual entrepreneur, if they meet the criteria for 3rd, 2nd, or 1st category entities”.

Art. 2.1.e of the Law

The above definition can be interpreted in two ways:

1) Subjects are all types of entities if they meet the criteria for 1-3 category entities, OR

2) Subjects are all types of entities, except for IEs which shall only be deemed as Subjects if they meet the criteria for 1-3 category entities.

The SARAS hotline has confirmed to our office that the latter interpretation is the correct one. Accordingly, an IE that meets the criteria for only the 4th category entity is not a Subject, and is exempt from financial reporting requirements.

If an IE meets the conditions for being a 1st, 2nd, or 3rd category entity, the reporting liabilities will arise.

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Janar K
Janar K

Managing Partner at ExpatHub.GE. With more than 15 years experience in planning business tax structures in countries around the world, Janar is our top expert on watertight structures with the minimum tax leakage.