Tax Update April 2018
The Tax Update April 2018 covers several new tax regulations as follows:
- Corporate Income Tax reduction facility (tax holiday)
- Announcement of list of countries having Quality Competent Authority Agreement (QCAA) for the purpose of Country by Country Reports (CbCR) with Indonesia
- The accelerated restitution for taxpayer who meets specific criteria
Tax Update March 2018
On 23 January 2018, the Directorate General of Tax has issued PMK-9 regarding the requirement of e-filling tax returns and the exemption for reporting the NIL tax return.
Tax Update February 2018
On 29 December 2017, the Directorate General of Tax (“DGT”) has issued PER-29 regarding the procedures for managing Country by Country Report (“CbCR”). PER-29 is issued as the implementing regulation for Ministry of Finance Regulation No. 213/PMK.03/2016 (“PMK-213”) which requires the taxpayer who has related party transactions to maintain 3 (three) tiered Transfer Pricing Documentation, i.e. Master File, Local File, and CbCR.
According to PER-29, there are several domestic taxpayers who qualify to submit the CbCR starting for fiscal year 2016.
Tax Update January 2018
In 2015, Ministry of Finance has issued a regulation No. PMK-169/PMK.010/2015 (“PMK-169”) to regulate the debt to equity ratio of 4:1 for the calculation of Income Tax. If the debt to equity ratio exceeds the ratio of 4:1, the interest expense can be deductible limited to the maximum ratio of 4:1.
Recently, the Directorate General of Tax has issued a regulation No. 25/PJ/2017 (“PER-25”) as the implementation for determining the debt to equity ratio for calculating the Income Tax and reporting procedures for foreign private debt.
Indonesian Transfer Pricing Documents Guideline
SSJK Consulting has published the Indonesian Transfer Pricing Documents Guideline based on the Ministry of Finance Regulation No. 213/PMK.03/2016. Under this regulation, every taxpayer who has related party transaction should prepare 3 tiered Transfer Pricing Documentation, i.e. Master File, Local File, and Country by Country Reporting (CbCR).
Tax Update December 2017
Directorate General of Tax Regulation has issued a regulation No. 18/PJ/2017 (“PER-18") regarding verification procedures of the Income Tax payment for the income on transfer of land and/or building, and the Agreement for Sale Purchase of Land and/or Building (PPJB). According to PER-18, the Tax Office will perform Formal and Material Verification to verify the payment of this income tax.