All foreign and local businesses will be impacted by the regulations of at least three following regulators:

• Revenue Service – local taxation;
• SARAS (Service for Accounting, Reporting, and Auditing Supervision) – mandatory financial and management reporting;
• Pension Agency – mandatory pensions for residents of Georgia.Revenue Service

Revenue Service

of Georgia represents oldest of the three regulators and is responsible for monitoring and collecting taxes. Local firms, provide accounting services in Tbilisi, Batumi, and other large cities of Georgia. Failing to comply with Revenue Service’s requirements may lead to significant penalties, therefore investors are encouraged to contact local accounting firms before starting business in the country.

SARAS

Since 2018, SARAS is responsible for collecting management and financial reports, prepared in accordance with the International Financial Reporting Standards (IFRS). All companies, regardless of their size are required to submit their information. The difference in the regulation of the companies of different sizes is in terms of audit requirements and levels of details required. Small and medium sized entities (“third category” and “fourth category” entities) are not required to audit their accounts and are only required to submit information based on their internal records. Accounting firms in Georgia usually submit the required information in scope of their accounting services.

Pension Agency

Mandatory state pension scheme enrollment was introduced in Georgia in 2019. Citizens of Georgia were classified by age categories and younger adults were enrolled in the scheme. Enrollment for older citizens was voluntary.

In accordance with the local requirements, companies are obliged to pay their share of pension (2%) for the enrolled employees and are additionally required to retain employee’s share of pension (2%) from their salaries. The aggregate amount (4%) is required to be transferred to the state pension fund. It should be noted that pensions are not applicable for foreign citizens (non-residents of Georgia), therefore, pensions are only relevant to local employees. Similarly, to the previous two requirements, accountants in Georgia are usually in charge of pension-related submissions.