Summary of Tax Regulation (October)

Summary of Tax Regulation

KEP – 170/PJ/2008, Format, Content, and Procedure for Periodic Place and Time of Validation of Periodic Value Added Tax Return Form No. 1108 at the Tax Office in the West Jakarta Regional Office of Directorate General of Taxes.

Tax Offices under the west Jakarta Regional Office of Directorate General of Taxes is appointed as the place of commencing the validity of the Monthly Value Added Tax Return Form No. 1108. The effective period of the use of this Form starts from the Period of October 2008.

39/PJ/2008, Income Tax Return Article 21 of year 2008 and its procedure for filling.

According to this regulation, every tax withholding agent has to fill, sign, and submit annual income tax return of Article 21 to tax office where tax withholding agent is registered. In adition, this regulation regulates the change of annual income tax return form of Article 21 and its procedure for filling to be in accordance with the attachment of this regulation of Director General of Tax. However, due to limiltation of space we could not present the procedure for filling in this newsletter. The regulation also regulates that since 06 October 2008, Regulation of Director General of Taxes Number PER-81/PJ./2007 concerning annual Corporate Income Tax Return, annual individual income tax return, and annual income tax return Article 21 of year 2007 with its procedure for filling, shall be still prevailed for filling annual income tax return article 21 of year 2007.

35/PJ/2008, Taxpayer Identification Number Ownership Obligation in Relation to Transfer of Right of Land and/or Building.

This regulation explains about the definition of Taxpayer Identification Number, Payment Slip of Acquisition Duty on Right of Land and Building (Surat Setoran Bea Perolehan Hak Atas Tanah dan Bangunan: SSBPHTB), and definition of other terms. The main provisions stipulated in this regulation are the obligation to state taxpayer Identification Number in SSB on BPTHB payment and Tax Payment Slip (SSP) on Income Tax payment on transfer of right of land and building. SSB exempted from the obligation to state the Taxpayer Identification Number is SSB on BPHTB payment by Individual Taxpayer with Sales Value of Taxable Object (Nilai Jual Objek Pajak:NJOP) and Acquisition Value of Taxable Object (Nilai Perolehan Objek Pajak: NPOP) transferred less than IDR 60 millions. SSP exempted from the said obligation is SSP for payment of Income Tax on income from transfer of asset in form of land and/or building by individual taxpayers with total tax to be paid less than IDR 3 millions.

62 Tahun 2008, Amendment of Government regulation Number 1 year 2007 concerning income tax facility for investment in certain bussines fields and/or certain areas.

The first point amended by this regulation is about sanction: 1) facility already given by this regulation is revoked; 2) subject to sanction in accordance with provision of tax regulation; and 3) cannot be given facility based on this regulation. In the previous regulation, this sanction is only intended for taxpayer using fixed asset that receive facility for a purpose other than those given by the facility or transfer wholly/partly fixed asset gaining the facility. Now, this sanction is also intended for taxpayer having the facility but no longer invest in determined certain bussines field/certain bussines field in certain area. The other amendment is about new provision concerning taxpayer running bussines in cement industry as stated in attachment II of this regulation that conduct reconstruction due to tsunami disaster in Nanggroe Aceh Darussalam province and Nias Islands in North Sumatera Province shall be liable liable to receive the facility according to this regulation effectively since 1 January 2005. In addition, this regulation informs that the implementation of this regulation will be evaluated at the longest 2 years since the stipulation of this regualtion. The evaluation will be conducted by a team established by Decree of Coordinating Minister of Economic. Last amendment that is amended by this regualation is attachment I and II of Government Regulation No. 1 year 2007 concerning classification of certain bussines field and certain area.

SE – 49/PJ/2008, Implementation of Director General of Taxes Regulation No. 35/PJ/2008 on Taxpayer Identification Number Ownership Obligation in Relation to Transfer of Right on Land and/or Building.

Upon the payment of Acquisition Duty on Right of Land and Building (Bea Perolehan Hak Atas Tanah dan Bangunan:BPHTB) and Income Tax on income from asset transfer of land and or building in sales and auction transactions, Taxpayers should state the Taxpayer Identification Number in the form of BPHTB Payment Slip (Surat Setoran BPHTB:SSB) or in Tax Payment Slip (SSP). The limit of Assessed Property Value (Nilai Jual Objek Pajak:NJOP) and Acquisition Value of Taxable Object (Nilai Perolehan Objek Pajak:NPOP) exempted from the obligation to state Taxpayer Identification Number in SSB by Individual Taxpayers is the amount less than IDR60,000,000. The limit of Income tax due exempted from the obligation to state Taxpayer Identification Number in SSP by Individual Taxpayer for Income Tax payment on transfer of right of land and/or building is the amount less than IDR3,000,000.

SE-4/PJ.03/2008, Affirmation of Income Tax Article 26 paragraph (4) Imposition in relation to Income Received or Acquired by Permanent Establishment Conducting Government Project Funded by Foreign Aid or Loan

Article 3 of Government Regulation No.42 Year 1995 as lastly amended with Government Regulation No.25 Year 2001 stipulates that, “Income Tax due on income received or acquired by contractors, consultants and main suppliers from works conducted in relation to Government projects implementation funded by foreign aid and or loan, is borne by the Government.” This Circular affirms that in the event that the party receiving such income is a permanent establishment (PE), the definition of “Income Tax” shall include tax on Taxable Income after deducted with tax from a PE in Indonesia under the Article 26 paragraph (4) of Income Tax Law. Thus, in the event that Income Tax due on income received/acquired by a PE meets the provisions as stipulated in Government Regulation No.42 Year 1995 resulting Income Tax due borne by the Government, Income Tax Article 26 paragraph (4) due is also borne by the Government. This Circular is also to revoke the affirmations contradictory to this Circular.

PER-34/PJ/2008, Format and Content of Land and Building Tax Return Form.

This regulation explains that Tax Returns (Surat Pemberitahuan Pajak Terutang:SPPT) are letters used by the Directorate General of Taxes to inform total Land and Building Tax due of Taxpayers. The said SPPT refers to paper form. The front page of the SPPT form covers information of: 1) Form serial number, 2) Name of Regional office of Directorate General of Taxes and Tax Office, 3) written sign of “SPPT PBB bukan merupakan bukti kepemilikan hak” (Land and Building Tax Return is not an ownership proof) , 4) Account code, 5) Tax Year and Sector Type of Land and Building Tax, 6) Tax Object Number, 7) Tax object location, 8.) Name and Address of Taxpayer, 9) Taxpayer Identification Number,10) Total area of land and/or building, 11) Category of land and/or building, 12) Assessed Property Value (Nilai Jual Objek Pajak:NJOP) per m2 of land and/or building, 13) Total NJOP of land and/or building, 14) NJOP as Land and Building Tax basis, 15) Assessed Value of Non Taxable Property (Nilai Jual Objek Pajak Tidak Kena Pajak: NJOPTKP), 16) NJOP for Land and Building Tax, 17) Taxable Sales Value (Nilai Jual Kena Pajak:NJKP), 18) Land and Building Tax due, 19) Land and Building Tax to be Paid, 20) Due date, 21) Place of Payment. The back page of the From covers: 1) Information of name of officer rendering the Form, 2) Date of Delivery, 3) Officer’s signature, and 4) other information. The format of the Form is attached on the regulation. At the time this regulation becomes effective,: 1) the previous SPPT Form already printed can be used specifically for tax object of village and city sectors for year 2009. The SPPT which is still in the old format owns the same lawful status with the new format ones.

1 Comment

  1. Nice writing. You are on my RSS reader now so I can read more from you down the road.

    Allen Taylor


Comments RSS TrackBack Identifier URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s