At Eesti Firma, we specialize in company registration in Estonia and offer a full range of accounting services. In this article, we discuss the deadlines for submitting annual disclosure. If you’re interested in learning more about the process, you can find detailed information in our dedicated article on annual reporting.
According to § 179 of the Commercial Code of the Republic of Estonia, all enterprises registered in Estonia are required to submit an annual financial report detailing the results of their business activities within six months after the end of the fiscal year.
What is the deadline for submitting the annual report?
For the majority of Estonian companies, whose fiscal year aligns with the calendar year, the deadline for submitting annual statements to the regulatory authorities is June 30th each year.
However, there is an exception for newly registered Estonian companies. If the enterprise was registered in the second half of the year (from July 1 to December 31), such an entity has the right to combine the financial statements for the initial partial year with the annual report for the next year, thereby not submitting a separate report for the split year.
Did you miss the deadline for submitting the financial disclosure?
Historically, many Estonian companies have frequently missed the deadlines for submitting financial statements or neglected their obligations altogether. However, the new Commercial Register Act (Est. Äriregistri seadus or ÄRS), which came into effect on February 1, 2023, provided the supervisory authorities with additional powers to ensure compliance with the obligation of providing financial statements by the undertakings registered in Estonia.
Possible consequences
If the submission of the annual financial report is delayed by several months, usually no immediate negative consequences arise for the entity. However, in case of a prolonged delay in submitting financial statements, the Business Register will take action, including issuing:
Warning of fine
First of all, the Commercial Register warns the enterprise and gives an additional deadline (usually 30 days) to rectify the situation and submit the financial report in accordance with all the requirements. If the resolution is correctly executed and the report is submitted, the situation will be resolved.
Fine
If the annual statement is not submitted within the additional deadlines established by the resolution of the Business Register, the supervisory authority has the right to impose a fine on the enterprise. The fine amount will depend on the specific circumstances, but it can reach up to EUR 3,200. It should be noted that fine payment will not release the entity from the obligation to submit statements, in connection with which the fine can be imposed repeatedly.
Fine of a company board member
The law allows, in addition to the company itself (legal entity), to impose fines on specific individuals (usually board members) who are responsible for the timely submission of the financial statements.
Warning of company removal
If the entity ignores the warnings made earlier, the supervisory authority has the right to issue a warning regarding the forced removal of the company from the Business Register and designate a specific deadline (usually 6 months) during which the statements should be submitted. Otherwise, the Commercial Register will begin the procedure for the forced removal of the company.
Forced company removal
In case all the previously indicated measures have not had any effect and the company has not submitted the financial statements within all the additional deadlines, the Commercial Register has the right to forcibly remove the entity.
In conclusion, it should be noted that the general public and potential business partners of your enterprise will have access to information about all the warnings and fine measures taken against the entity. Due to the circumstances described above, we recommend that you treat the obligation to submit the fiscal year statements of your Estonian undertaking with due diligence and submit financial reports to the Business Register timely.
CONTACT US
If you need to prepare financial statements for your Estonian company, feel free to contact our experienced accountants and consultants. Our specialists will prepare the annual disclosure for your undertaking in the shortest possible time!
