Annual report of the Estonian Company

Yes, in Estonia all companies are obliged to file an annual report with the Commercial Register, even if they have not carried out any business activities during the financial year. This requirement is mandatory regardless of the volume or lack of operations during the year.

If a company has not carried out any economic activity and has not had any accounting transactions (neither in the bank nor in cash), it must file a so-called zero balance sheet report. This report shows that there were no financial movements or transactions during the reporting period.

The purpose of filing such a report is to confirm the absence of activity and provide transparency to government authorities, creditors and other stakeholders. It also helps to keep corporate records in order and ensures that the company is compliant with legal requirements.

In Estonia, the annual report must be prepared, approved and filed with the Commercial Register within six months after the end of the business year. For most companies whose business year coincides with the calendar year (i.e. from 1 January to 31 December), the deadline for filing the annual report is 30 June of the following year.

This is a mandatory requirement and failure to comply may result in penalties or other legal consequences. It is important to ensure that all necessary financial documents are properly prepared and submitted within the appropriate timeframe to avoid potential problems with regulatory authorities.

If the annual report is not submitted by the due date, the Estonian Commercial Register takes a number of measures to ensure compliance with corporate discipline and legislation. At the initial stage, the Commercial Register usually issues a warning to the company and gives an additional deadline for submitting the report, which is usually 30 days.

If a company ignores this requirement and fails to submit an annual report by the additional deadline, it may be fined. The amount of the fine can vary, usually between €200 and €3,200, depending on the circumstances of the offence.

In the event of continued non-compliance with reporting requirements, the Commercial Register may initiate more serious measures, including compulsory liquidation of the company. Such action is taken as a last resort if both fines and warnings do not result in the fulfilment of obligations.

Given the tightening of control over the timeliness of filing financial reports and the increasing number of orders and fines issued, it is extremely important not to delay the preparation and filing of annual accounts. Timely fulfilment of this obligation will help avoid legal and financial risks for your business.

In Estonia, the annual report of companies is submitted to state authorities mainly electronically. This is done via the online portal of the Commercial Register. This requires that the CEO of the company (or a member of the management board) has a valid electronic signature. The e-signature can be done using an ID-card, Mobiil-ID or e-Resident status. This allows to verify the identity of the signatory and to guarantee the legal validity of the document.

Primary method of delivery:

Electronic filing via the Commercial Register portal. The company's accountant, who has access to the relevant electronic systems, completes the annual report forms and prepares the report for signature. The CEO or authorised board member then signs the report with an electronic signature.

Alternative method for non-residents:

Manual signature and scanning. If all general directors are non-residents who do not have an Estonian personal identity code and electronic signature rights, it is possible to sign the annual report manually. In this case, the company's accountant fills in the necessary forms and generates the report in advance. The CEO then signs the report manually, after which the document is scanned and submitted as a scanned copy to the Commercial Register.

Such filing methods simplify the process and make it more accessible to all types of companies, including those with management located outside Estonia. It is important to comply with all procedural requirements to ensure that the financial statements are submitted correctly and on time.

In Estonia, a company's annual report is filed with the Estonian Business Register, also known as the Commercial Register. This is a national register that serves to officially register companies and provide information about them, including their financial statements.

This register is maintained by the Registration Service of the Estonian Judiciary and is the main source of legal information on the activities of companies. Filing an annual report via the Commercial Register portal is mandatory for all companies registered in Estonia and represents an important element of corporate transparency and compliance.

In Estonia, the deadlines for submission of annual reports for companies are set in such a way that the report must be prepared, approved and submitted to the Commercial Register within six months after the end of the company's financial year. If the financial year coincides with a calendar year (1 January to 31 December), the annual report must be submitted no later than 30 June of the following year.

This requirement is mandatory for all legal entities registered in Estonia and is an important part of corporate and tax reporting. Failure to comply with these deadlines may result in fines and other administrative measures.

Yes, in Estonia all companies, including those that have not conducted any business activities during the financial year, are obliged to file an annual report. This requirement applies to all legal entities registered in the Commercial Register. Even if a company has not had any financial transactions and has not carried out any business activities, it still has to file a so-called "zero" annual report.

Filing an annual report in such cases reflects the lack of activity and is an important documentation of the company's status for the Commercial Register, tax authorities and other stakeholders. It also helps to maintain transparency of corporate governance and ensures compliance with legal requirements.

A company's annual report in Estonia must include the following key elements:

1. Balance Sheet - shows the financial condition of the company on the last day of the accounting period, showing assets, liabilities and equity.
2. Income Statement - shows the financial results of the company's activities for the reporting year, including revenues, expenses, and the resulting profit or loss.
3. Cash Flow Statement - provides information on the generation and use of cash and cash equivalents during the year, separating flows into operating, investing and financing activities.
4. Appendices - provide explanations and additional information about the financial data, including explanations of balance sheet and income statement line items and information about accounting policies and methods used.
5. Auditor's Report - If a company is required to have an audit (usually for large enterprises, public interests or those exceeding certain size criteria), an auditor's report must be included in the annual report. This opinion provides an independent assessment of the reliability of the financial statements.

These components provide a comprehensive view of the company's financial position, operational efficiency and liquidity, and how management has utilised available resources during the reporting period. All of this data is critical to shareholders, creditors, investors and regulators.

The electronic portal of the Commercial Register is used to submit the annual report in Estonia. Here are step-by-step instructions on how to do this:

1. Obtaining an electronic signature: You need an Estonian electronic signature to access the portal and sign documents. It can be an ID card, Mobiil-ID or e-resident status. An electronic signature allows you to verify your identity and ensure that the documents you submit are legally valid.
2. Login to the Commercial Registry portal: Once you have obtained the e-signature facility, you need to log in to the Commercial Registry portal. This can be done through the e-Registry website.
3. Filling out the report: The portal provides forms and instructions for completing the annual report. You need to carefully enter all required financial data, including balance sheet, income statement, cash flow statement, and other related appendices.
4. Signing the report: After completing the annual report form, the document must be electronically signed by an authorised person, such as a member of the company's management board.
5. Report Submission: Having completed the signature, the report is submitted through the portal. Once submitted, you will receive an acknowledgement from the Commercial Registry that the report has been received.
6. Using an accountant: If you do not have access to an electronic signature, you can contact a local accountant. The accountant will be able to prepare and file the report on your behalf using their credentials and electronic signature.

Filing the annual report through the Commercial Register portal makes the process easier and more accessible, while ensuring the legal validity and transparency of all financial transactions.

If the annual report is not filed by the deadline, it can lead to serious consequences for the company in Estonia. Here is what can happen:

1. Fines: The Estonian Commercial Register has the right to impose fines on a company for late submission of the annual report. The amount of the fine may vary depending on the seriousness of the violation, the type of company, its previous behaviour and other circumstances related to the specific case.
2. Warnings and additional time limits: The Commercial Registry will normally issue a warning first and may provide an additional period of time to remedy the situation before applying more stringent measures.
3. Compulsory liquidation: If fines and warnings do not result in the submission of the annual report, the Registry may initiate the process of compulsory liquidation of the company. This is an extreme measure that is applied in case of continued non-compliance with legal requirements.
4. Exclusion from the register: The consequence of compulsory liquidation may be the removal of the company from the Commercial Register, which effectively means that it ceases to exist as a legal entity.

These measures emphasise the importance of filing the annual report on time and complying with all corporate and tax requirements in Estonia. Failure to comply with these requirements may seriously affect the company's reputation and financial condition, as well as its ability to conduct business.

In Estonia, the audit of the annual report is mandatory for those companies that fulfil at least two of the following three criteria during the reporting year:

1. The book value of assets exceeds 2 million euros.
2. Annual turnover exceeds 4 million euros.
3. The average number of employees exceeds 50.

If a company does not reach at least two of these thresholds, an audit of the annual report is not required, unless this requirement is set out in the company's internal documents or at the request of the founders or shareholders.

Such rules ensure that only companies with greater economic clout are subject to additional scrutiny to ensure the transparency and reliability of financial information provided to stakeholders such as investors, creditors and government authorities.

You can use the online resources of the Estonian Commercial Register to search and view annual reports of Estonian companies. Here is how you can do it:

1. Visit the website of the Estonian Commercial Register: This is the official portal where all corporate data, including annual reports, is published.
2. Using the search engine: On the website you can search for a company by name or registration number. This function allows you to find a specific company and access to its documents.
3. View Annual Reports: Once you have found a company you are interested in, you can view the filed annual reports. These are usually available in PDF format and include full financial statements.
4. Analyse financial information: Key financial indicators of the company can also be accessed on the website, allowing you to quickly assess its financial condition without having to analyse the entire report in detail.

This resource is an important tool for investors, analysts, potential partners and other interested parties who need access to financial information about companies in Estonia.

After submitting the annual report, the data processing and registration process goes through several stages in the Estonian Commercial Register:

1. Document verification: The Commercial Register carries out an initial check of the submitted documents for compliance with the format, completeness and correctness of completion. Special attention is paid to the compliance of the data with the Estonian legal requirements.
2. Registration in the register: If the documents are free of errors and fully comply with the requirements, the information from the annual report is entered into the register. This updates the data on the financial status of the company available for public viewing.
3. Feedback and Corrections: If errors or deficiencies in documentation are discovered during the audit process, the company will receive a notice requiring it to correct the issues identified. In this case, corrections will need to be made and the report will need to be resubmitted or additional clarifications provided.
4. Consequences of non-compliance: If a request to correct errors is ignored or if the corrections provided do not comply with the requirements, the company may be subject to fines or other legal consequences, including possible compulsory liquidation.
5. Access to reporting: Once an annual report has been successfully registered with the Commercial Register, the data becomes available for public viewing through the register's online system. This allows stakeholders such as investors, partners and regulators to assess a company's financial health and performance.

Thus, filing an annual report is not only a legal requirement, but also an important element of corporate transparency and maintaining trust between a company and its stakeholders.

Yes, you can correct the annual report after filing it if you find errors or inaccuracies in it. Here are the main steps you should take to correct the annual report in Estonia:

1. Identifying errors: First, you need to determine exactly which elements of the report need to be corrected.
2. Preparing the amended report: An amended version of the annual report should then be prepared, ensuring that all data in it is now accurate and fully compliant.
3. Signing and filing corrections: The corrected report must be signed by an authorised person of the company using an electronic signature. It should then be submitted through the same Commercial Register e-portal as the original report.
4. Notification to the Commercial Registry: It is also recommended to notify the Commercial Registry of changes, especially if the original report has already been accepted and registered.
5. Status tracking: Once an amended report has been submitted, it is important to track its status through the Commercial Register portal to ensure that all changes have been correctly processed and recorded.

It is important to make corrections as soon as possible after discovering errors to avoid possible punitive measures or misunderstandings with regulatory authorities. Incorrect data in the annual report may lead to legal consequences, including fines and other sanctions.

In Estonia, all official documents submitted to public authorities, including the Commercial Register, must be submitted in Estonian. This requirement is driven by the need to ensure that information is accessible and understandable to all stakeholders within the country's legal system.

If your annual report is originally in English or another foreign language, it must be translated into Estonian before submission. It is important that the translation is accurate and professionally done to avoid misunderstandings or errors that could affect the legal validity of the document. It is recommended to use the services of a certified translator, especially for important documents such as the annual report.

Providing false or misleading information in an annual report in Estonia has serious consequences, as it is a violation of the law and can affect the credibility of the company. Here are the main types of consequences a company may face:

1. Penalties: The company may be fined. The amount of fines depends on the severity of the violation and its impact on the financial statements.
2. Administrative Measures: The Company may be subject to various administrative measures, including requests for corrected information or additional audits.
3. Criminal liability: In serious cases, especially if deliberate misleading of stakeholders or an attempt to conceal financial problems is proven, responsible persons in the company may be held criminally liable.
4. Loss of credibility: Inaccurate information can seriously undermine the credibility of a company with investors, partners and customers, negatively impacting business.
5. Problems with tax authorities: Inaccurate information may lead to additional tax audits and tax penalties if the company is found to have incorrectly reported its income and expenses.
6. Interaction with regulatory organisations: The Company may face increased levels of inspection and scrutiny from regulatory authorities, which may result in additional costs and administrative difficulties.

In light of these risks, it is critical for companies to ensure that their financial reporting is accurate and transparent. This helps to maintain the legitimacy of operations and a positive image of the company in the marketplace.

In Estonia, legislation does not oblige companies to post their annual report on their website. However, many companies choose to voluntarily post their annual reports in the interests of transparency and openness. This practice can lead to several positive effects:

1. Investor confidence: Public access to financial information can increase the confidence of existing and potential investors, as they can easily gain insight into the company's financial condition and operating performance.
2. Improved corporate image: Transparency in financial reporting can have a positive impact on the public perception of a company, emphasising its commitment to high standards of governance and ethical behaviour.
3. Attracting new customers and partners: Openness of information can build trust with customers and partners who value transparency as an important factor in choosing business partners.
4. Compliance with international standards: For companies operating internationally or seeking to attract foreign investment, publishing annual reports can be part of compliance with international corporate governance standards.

Thus, although not legally required, publishing annual reports on a company's website can be an important part of a company's strategy to ensure transparency and maintain the trust of all stakeholders.

Yes, companies can change their financial year in Estonia, but this process requires following certain procedures:

1. Decision-making by the founders or shareholders: The first step is to pass a resolution to change the financial year at a general meeting of the company's founders or shareholders. This decision must be recorded in the minutes of the meeting.
2. Introduction of amendments to the constituent documents: Depending on the changes that will be required in the company's constituent documents, it may be necessary to update them accordingly and register the changes.
3. Registration of changes in the Commercial Register: After internal approval of a change to the financial year, it is necessary to register the change in the Commercial Register. This is done by submitting an application with the relevant documents supporting the decision.
4. Impact on the timing of filing the annual report: A change in the fiscal year may affect the timing of filing the annual report. For example, if the financial year is changed from a calendar year to a different period, the timing of filing the annual report will also change accordingly. A company should take this change into account to avoid late filing.

Changing your financial year is a significant decision that can have long-term implications for your company's management, tax planning and reporting, so it is important to carefully weigh up the pros and cons before making such a decision.

Yes, there is a risk of liquidation of the company due to repeated non-compliance with the requirement to submit the annual report in Estonia, but this is a last resort. This is how the situation usually develops:

1. Warnings and penalties: If a company fails to submit an annual report on time, the Commercial Register first sends out warnings. These warnings are often accompanied by fines, giving the company an opportunity to rectify the situation.
2. Additional deadlines: The Commercial Registry will normally provide additional deadlines for filing the required documents. If the company takes advantage of this opportunity and submits the required documents, the liquidation process will not be initiated.
3. Repeated non-compliance: If a company repeatedly ignores requirements and fails to submit an annual report for a long period of time, the Commercial Registry may consider liquidation. This decision is taken as a last resort after all warnings and defaults.
4. Liquidation procedure: If a decision is taken to liquidate, it is carried out through a court procedure in which the company has the right to defend its interests.
5. Co-operation with the Commercial Registry: Companies that actively co-operate with the Commercial Registry and endeavour to rectify breaches are significantly less threatened with liquidation. Constant communication and demonstration of a willingness to correct mistakes has a positive impact on the regulator's perception of the company.

Therefore, if your company has experienced late filing of its annual report, it is important to take steps as soon as possible to rectify the situation and avoid further legal complications.

If you find errors or inaccuracies after submitting the annual report to the Estonian Commercial Register, you really should submit a corrected version. Here is how you can amend an annual report that has already been submitted:

1. Preparing an amended report: You will need to prepare an amended annual report, correcting any errors or inaccuracies found. Ensure that all financial data and supporting information is accurate and fully reflects the financial condition of your company.
2. Documents to submit: You will need to prepare a set of documents similar to what was originally submitted. This includes all financial statements and attachments, and possibly an explanatory note indicating that the documents submitted are a corrected version.
3. Signing the report: Just like the original report, the amended version must be signed by an authorised person of the company using an electronic signature.
4. Submitting a report through the e-portal: The corrected report should be submitted through the same Commercial Registry e-portal as the original report. Specify when submitting that it is a corrected version of a previously submitted report.
5. Monitor the process: Once you have submitted your corrected report, monitor its status through the Commercial Registry portal to ensure that it has been accepted and registered properly.
6. Communication with the Commercial Registry: If you have questions or require additional information, be prepared to dialogue with the Commercial Registry.

Filing an amended annual report helps ensure the accuracy of your corporate reporting and maintains the confidence of parties interested in your company's financial health.

Yes, the Estonian Commercial Register provides general instructions and information on how to prepare and file an annual report on its official website. These resources may include document templates, step-by-step guides and answers to frequently asked questions to help navigate the filing process.

However, it is worth noting that the Commercial Register does not provide personalised advice or support in the preparation of financial statements. If you have specific questions or difficulties that require detailed understanding or specialised knowledge, you should seek assistance from qualified professionals such as:

• Accountants: They can help not only in preparing reports, but also in ensuring that they comply with Estonian accounting and tax standards.
• Corporate governance consultants: Experts in this field can help understand documentation requirements and incorporation procedures.
• Lawyers specialising in corporate law: They can provide legal advice on a company's corporate requirements and obligations.

By taking advantage of professional help, you can avoid potential errors and ensure that your annual report is prepared correctly and submitted to the Commercial Register on time.

In Estonia, the responsibility for the correctness and timeliness of the submission of the company's annual report lies with the members of the company's management board. Depending on the management structure of the company, these may be directors or members of the board of directors.

The primary responsibilities of board members include:

1. Report preparation: The board members must ensure that the annual report fully and accurately reflects the financial position of the company. The report should be prepared in accordance with applicable accounting standards and legal requirements.
2. Signing the report: Once the annual report has been prepared, board members should sign it, thereby confirming its accuracy and completeness.
3. Report filing: They are also responsible for filing the report with the Commercial Register in a timely manner. The filing deadlines depend on the legislation and may vary depending on whether the financial year corresponds to the calendar year.

Possible consequences for failure to fulfil responsibilities:

• If board members fail to fulfil their duties to prepare and file an annual report, the company may be subject to fines.
• In more serious cases, for example, if false information is provided, administrative or even criminal sanctions may be imposed on board members.

It is therefore important for company board members not only to follow the legal requirements when preparing and filing the annual report, but also to pay attention to the accuracy of the information provided in order to avoid legal consequences.