Georgia - New Country-by-Country Reporting Rules Effective in 2025

Original content provided by BDO

Georgia has introduced significant legislative updates to its country-by-country (CbC) reporting framework for multinational enterprise (MNE) groups that entered into effect on 1 January 2025.

Although the CbC reporting obligation was introduced in 2020 under the Georgian Tax Code, an order of the Georgia’s minister of finance setting out the filing procedure entered into force on 1 January 2025. Therefore, the rule applies to subsequent years, starting with the 2025 fiscal year.

However, due to the current lack of formal clarification from the Georgian Revenue Service, it may be prudent to also factor in the 2024 fiscal year, particularly if the MNE group's 2024 fiscal year ends during the 2025 calendar year. The reporting rule will already be in effect by the time the CbC report filing obligation for the 2024 fiscal year becomes due. Therefore, it may be advisable to submit the notification for 2024 and, if necessary, file the CbC report as well.

Georgia’s CbC report legislation is aligned with the OECD recommendations for the implementation of CbC reporting rules as set out under Action 13 of the BEPS project.

Who is Subject to the Rules?

The regulation applies to Georgian resident entities that are part of an MNE group with consolidated annual revenue exceeding EUR 750 million.

A Georgian resident enterprise must file the CbC report if:

• It is the ultimate parent entity (UPE) of the MNE group, or
• One of the following criteria applies:
  • The UPE or surrogate entity is not required to file a CbC report in its own jurisdiction.
  • No competent authority agreement is in place to automatically exchange CbC reports between the jurisdictions of the UPE or surrogate entity and Georgia.
  • There is a systemic failure in the UPE or surrogate entity’s jurisdiction to exchange CbC reports.

Key Obligations for Georgian Resident Enterprises

If a Georgian entity is part of an MNE group with consolidated annual revenue exceeding EUR 750 million, it must now assess its CbC reporting responsibilities under the new rules:

If the entity is required to file a CbC report in Georgia:

• The entity must notify the Georgian Tax Authority of its obligation to file the CbC report no later than the last day of the MNE group’s reporting fiscal year.
• The CbC report must be submitted by December 31 of the year following the MNE group’s reporting fiscal year.

If the entity is not required to file a CbC report in Georgia:

• It must notify the Georgian Tax Authority of the identity and tax residence of the entity filing the CbC report on behalf of the MNE group no later than the last day of the group’s reporting fiscal year.

Failure to submit a CbC report on time - or submitting an incomplete report - will result in a GEL 5,000 fine.