Accounting and Auditing Services
Taxation in Indonesia
It is compulsory for all PT PMA companies in Indonesia to pay taxes and report the company’s financial status regularly. Many of Indonesians’ taxes that should be paid by PT PMA are similar to what stakeholders should pay in different countries. Among them are monthly and annually withholding taxes, monthly and annually income taxes, Value Added Tax (VAT), Luxury Goods Sales Tax (LGST) – if any, along with the company investment plan. Those taxes should be paid in the local tax office, where the company’s office is located.
When a PT PMA has a domicile in the Indonesian territory, it will be treated as Indonesian tax resident, so that the company has the obligation as a resident taxpayer. The taxation regulation in Indonesia incorporates both a self-assessment system and a withholding tax system.
In order to fulfill the obligation to pay the tax, PT PMA can choose one option among the two following options:
- Hiring an accountant to do all the reporting and payment of the tax
- Finding a tax consultant to help the company dealing with the tax
Some taxes should be paid monthly and others are required to be filed annually. The company’s taxes should be reported monthly include Corporate Income Tax, Employee Withholding Tax, Other Withholding Taxes, as well as VAT and LGST. These taxes are usually paid before the 10th day of the following month for the withholding taxes and before the 15th of the following month for the Corporate Income Tax. The first three taxes must be filed or reported before the 20th of the following month, whereas for VAT and LGST, they have to be reported at the end of the following month.
For taxes that should be paid annually, they include Corporate Income Tax, Individual Income Tax, and Land and Building Tax (for both the office and the factory or warehouse – if any). The deadline for the first two is before filing the tax return, and the deadline for the last one is 6 months after receiving a tax notification letter from the tax office.
All taxes should be paid regionally.
Being late in making payment for the company taxes and individual taxes in Indonesia may result in financial penalty. The tax payer should pay an interest of 2% per month for late payment. The maximum interest that should be paid by the tax payers is 48%. Considering the amount of extra money that you have to spend for the fine, it is recommended to follow the deadline strictly.
Annual Financial Auditing
Our Annual Financial Audit approach is based on an understanding of our clients’ business processes, goals, and strategies. This enables us to identify and assess the risks that impact their business and achievement of goals
We understand how important it is for you to maintain business as usual during the audit process, with minimal disruption to your day-to-day operations. We will also work with you to identify weaknesses and assist with suggested rectification procedures.
Statutory audit not only requires the review of financial information and application of regulation, but there also needs to be support; support for the accountants completing the compliance, the trustee and the members. Our team of specialists can be relied on to not only identify issues but to also provide assistance and guidance on rectification and compliance.
Advantages of Auditing:
- Satisfy stakeholders such as employees, customers, suppliers and pressure group, as well as the investing community, as to the credibility of published information
- Facilitate the payment of corporate tax, good and services tax, and other taxes on time and accurately, thereby avoiding interest, penalties and investigations
- Enable company to comply with banking covenants
- Help to deter and detect material fraud and error.
- Facilitate the purchase and sale of businesses
- Take advantage of the spin-off benefits such as advice on the structure and operations of systems
- Demonstrate good corporate governance and citizenship
For further enquiries or a non-obligatory quote, please send us an email enquiry.