KH Friend, do you know that January to April is tax month? Why? Because in that period is the period of personal taxpayers and corporate taxpayers reporting the Annual Tax Return for a certain tax year. As in March, personal taxpayers have reported their personal Annual Tax Return, and in April, it is time for corporate taxpayers to report the 2023 Annual Corporate Tax Return. The reporting deadline is until April 30, 2024. So, what is meant by the Annual Corporate Tax Return? How to do the reporting? Check out the full details in the following article.
What is an annual corporate tax return?
Annual Corporate Tax Return is a letter used to report tax payments, tax objects and non-objects, assets and liabilities of the company in accordance with applicable tax laws and regulations. Unlike the personal Annual Tax Return which has more than one form, the Corporate Annual Tax Return only has one type of form, namely the SPT 1771 form.
Business entities or companies that use SPT 1771 are applied to business entities such as Limited Liability Companies (PT), Commanditer Venture (CV), Trade Enterprises (UD), organizations, foundations and associations.
The rules regarding the obligation to report the annual corporate income tax return are regulated in Directorate General of Taxes Regulation No. PER-30/PJ/2017 concerning the Fourth Amendment to PER-34/PJ/2010.
Functions and Types of Corporate Income Tax Return
The Annual Corporate Tax Return serves as proof of accountability for its tax obligations to the state. In addition, the Annual Tax Return has several important functions, both for the corporate taxpayer itself, the tax withholder, and the tax officer. The following is the explanation:
Taxable Entrepreneur (PKP)
The Annual Tax Return serves as a tool to report and account for tax payments, especially PPnBM and PPN taxes. It also contains information on the crediting of PM (Incoming Tax) against PK (Output Tax).
Tax Withholder
Proof that the tax deducted from the employee’s salary has been paid. This is an act of corporate responsibility for employee taxes.
Tax Officer
SPT is used as a tool to test taxpayer compliance with applicable tax regulations. In addition, it can be a form of implementation of the supervisory function by tax officials. The information contained in the Annual Tax Return is used to monitor and ensure taxpayer compliance with tax regulations.
Type of Corporate Tax Reported in Annual Tax Return
The SPT contains information related to business activities and tax administration. Such information includes the financial statements of the business or company, VAT and/or STLG activities, and income tax period.
Article 21 Income Tax
This type of Income Tax Article 21 is imposed on all Corporate Taxpayers on the income received by each employee. The tax is deducted based on progressive tax, which is based on article 17 rates.
Article 26 Income Tax
This type of income tax with article 26 is income tax imposed or withheld on income sourced from Indonesia received or earned by foreign taxpayers other than permanent establishment (BUT) in Indonesia.
Value Added Tax
This type of tax is generally imposed on Business Entities that have been recognized as Taxable Entrepreneurs or commonly referred to as PKP after going through the submission stages and meeting the requirements. This type of tax is imposed for every purchase and sales transaction which is then also known as Input Tax and Output Tax.
Article 25 Income Tax
This type of income tax with article 25 is a tax installment derived from the amount of income tax payable according to the Annual Income Tax Return minus income tax collected or withheld and income tax paid or payable abroad that is allowed to be credited.
Article 29 Income Tax
While the type of income tax in article 29, when the amount of tax payable by a company in one tax year is greater than the amount of tax credit that has been collected or withheld by other parties and that has been paid by itself, then the excess tax payable or tax payable minus tax credit results in Income Tax Article 29.
ALSO READ: Business Players, Immediately Report Annual Tax Return Before April 30, 2024!
The income tax must be paid before the Annual Corporate Income Tax Return is filed.
Provisions for Annual Corporate Tax Return Reporting
There are several things that KH pals need to know regarding the reporting of the Annual Corporate Tax Return, including:
- Fill out the tax return correctly, completely, and clearly.
- The SPT must be filled in Indonesian, using Latin letters and units of Rupiah or foreign currency with permission from the Ministry of Finance.
- Taxpayers are required to sign the tax return.
- Submission of SPT in accordance with the Tax Office where the taxpayer is registered.
- Taxpayers can apply for an extension of the Annual Income Tax Return reporting time within a maximum period of two months from the reporting deadline.
- The extension of reporting time must be submitted to the DGT before the reporting deadline.
- Attach supporting documents in accordance with the provisions stipulated in the Minister of Finance Regulation.
What are the Sanctions for Not Reporting the Annual Corporate Tax Return?
Based on the regulations in the Law on General Provisions and Tax Procedures (UU KUP), corporate taxpayers who are late or do not report their annual tax return will be subject to sanctions in the form of fines to criminal sanctions. The amount of the fine for late reporting of the Annual Corporate Tax Return is IDR 1 million. Meanwhile, criminal sanctions for corporate taxpayers who deliberately do not report their Annual Tax Return in the form of imprisonment in accordance with Article 39 paragraph (1) of the KUP Law. The minimum imprisonment is 6 months and the maximum is 6 years for corporate taxpayers who deliberately do not report their Annual Tax Return.
In addition to imprisonment, a fine of at least 2 times the amount of tax payable that is not or underpaid will also be imposed. Or a maximum fine of 4 times the amount of tax payable that is not or underpaid.
KH Contact
So, what are you waiting for? Immediately report the Annual Corporate Income Tax Return before April 30, 2024! To make it easier, you can just leave it to Kontrak Hukum. In order to bring convenience in taking care of business needs including taxation, Kontrak Hukum presents the first subscription service in Indonesia Digital Business Assistant (DiBA).
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Subscribing to DiBA is like having a full team because we can provide tax reporting services, to finance and other legalities. Guaranteed to be easy, safe and affordable as it will be handled directly by experienced professionals. For more information, visit the KH Services – DiBA page. If you have other questions, you can also consult for free via Ask KH or send a direct message (DM) to Instagram @kontrakhukum. With KH, #semuajadiberes!
