Pursuant to the amendment introduced by Order No. 52 of the Minister of Finance of Georgia dated February 24, 2026, to Order No. 996 of December 31, 2010 of the Minister of Finance of Georgia “On Tax Administration,” the annual Corporate Income Tax return form and the monthly Corporate Income Tax return form (only for the March reporting period) have been supplemented with an annex titled: “Information on International Controlled Transactions as Provided for in Articles 126–129¹ of the Tax Code of Georgia.”
According to the amendment, an enterprise is required to disclose in the above-mentioned annex information on international controlled transactions carried out during 2025 and subsequent calendar years, if the total amount of international controlled transactions conducted by the enterprise (including gratuitous transactions and outstanding creditor/debtor balances) exceeds GEL 500,000 in aggregate within a single calendar year.
International Controlled Transactions
It is important for the taxpayer to determine what is considered an international controlled transaction. International controlled transactions include transactions that are carried out between a resident enterprise of Georgia and a non-resident enterprise, and the non-resident enterprise is a related party of the Georgian enterprise and/or a person registered in a preferential tax jurisdiction (offshore).
Two enterprises are considered related enterprises if one person directly or indirectly participates in the management, control, or capital of the other person. Also, if the same persons directly or indirectly participate in the management, control, or capital of two persons.
Direct or indirect participation in the management, control, or capital of an enterprise implies:
- If a person directly or indirectly owns more than 50 percent of the enterprise, and/or
- He/she effectively exercises control over the enterprise’s business decisions.
In the event that the total amount of transactions carried out in 2025 by a resident enterprise of Georgia with a related and/or offshore-registered enterprise exceeds GEL 500,000, the Georgian enterprise must reflect in the mentioned annex information about the international controlled transactions carried out during 2025. If the enterprise is taxed under the Estonian model of profit taxation (distributed profit), it shall reflect the information in the declaration to be submitted for the March 2026 reporting period, accordingly the deadline for submission of information will be April 15, 2026, and in other cases the above-mentioned information shall be reflected when filing the annual profit tax return, accordingly, the deadline will be April 1.
Access the full text of the amendment as a PDF document here.
Importance of Transfer Pricing Documentation and Risks of Its Absence
Within the framework of this amendment, maintaining detailed records of international controlled transactions and preparing appropriate transfer pricing documentation becomes even more important.
Since the taxpayer must indicate in the tax return whether documentation supporting the valuation of controlled transactions exists, the absence of such documentation serves as an indication to the tax authority that the transactions conducted may not comply with the arm’s length principle. This, in turn, creates additional tax risks for the enterprise.
The amendment entered into force on February 25, 2026, and applies to information to be submitted for the 2025 and subsequent reporting periods.