Managing Monthly Tax Reporting
Handling tax matters in Indonesia can be a complex and time-consuming process due to the numerous laws, regulations, and gray areas involved. However, it is crucial for long-term residents, business owners, or employees in Indonesia to fully understand their tax obligations.
When starting a business in Indonesia, one of the first things new business owners learn is the obligation to submit monthly tax reports, in addition to annual reports. This can be a significant cost and should be factored in from the outset before registering the company.
When Should You Start Filing Taxes ?
You must register as a taxpayer as soon as you establish a business in Indonesia. If your business has an annual gross income of more than IDR 4.8 billion, you will receive a Taxpayer Identification Number (NPWP), a Certificate of Registration (SKT), and a Taxable Entrepreneur Certificate (SPPKP), which grants additional authority as a taxable entrepreneur.
Once you have an NPWP and SKT, you are required to calculate, pay, and report taxes to the Indonesian Tax Authority. It is important to remember that even if your business has not yet made a profit, you are still required to file tax reports. Failure to submit tax reports on time can result in financial penalties, additional fees, and, in extreme cases, detention. Monthly tax reporting for businesses is due on the 20th of each month, while tax payments are due on the 15th of the following month.
Ensuring Tax Compliance with Harmony
Filing monthly tax reports can be a complicated task, but you don’t have to face it alone. Harmony is here to assist you at every step of the monthly tax reporting process, ensuring that all your tax obligations are met accurately and on time, so you can focus on growing your business.
