If you’re someone who is involved in the business world, of course you already understand that business and taxes are inseparable. In essence, all business people must understand that if they already have a business, then they are also obliged to pay taxes to the state. When taking care of taxes, you as a business owner will also be faced with the term Taxable Entrepreneur (PKP). Then, what is meant by PKP? What are the requirements and benefits for business actors?
Definition of Taxable Person for VAT Purposes
Before getting to know more about the requirements and benefits of PKP, you first need to know the definition of PKP in general. PKP or Taxable Entrepreneurs are entrepreneurs or business actors who deliver taxable goods (BKP) and / or deliver taxable services (JKP) in accordance with Law (UU) Number 42 of 2009. However, this does not include small entrepreneurs whose limits are determined by the Minister of Finance’s decision. Unless the small entrepreneur applies and chooses to become a PKP. There are several rights and obligations that must be fulfilled for PKP, where business actors who have been confirmed as PKP will get the following rights:
- Can perform input tax crediting on the acquisition of BKP/JKP
- May make restitution or compensation for excess Value Added Tax (VAT) paid by PKP.
In addition, business actors who have been confirmed as PKP also have obligations that must be fulfilled, namely:
- Collecting VAT / PPnBM payable
- Depositing underpaid VAT / PPnBM payable
- Reporting / submitting the Annual Tax Return (SPT) for the period of VAT / PPnBM payable
Requirements and Procedures for Filing for Taxable Person for VAT Purposes
As mentioned earlier, there are exceptions for PKP, namely small entrepreneurs whose limits have been set by a decree of the Minister of Finance. But there is no need to worry, because even small entrepreneurs can still apply and choose to become PKP. Small entrepreneurs who can apply for PKP are those who have a turnover limit of up to IDR 4.8 billion per year. In addition, make sure that you have submitted your income tax returns for the last two tax years and do not have any tax debts, unless you have received approval for installment or postponement of tax payments. Then, the application for confirmation as a PKP can be done by filling out the Taxable Entrepreneur Confirmation Form which can be downloaded on the tax.go.id page and completing several documents. Documents that must be completed include:
- Copy of ID card for Indonesian citizens
- Copy of Taxpayer Identification Number (NPWP)
- Copy of passport, copy of Limited Stay Permit Card (KITAS) or Permanent Stay Permit Card (KITAP) for foreigners
- A statement letter stamped in the name of the taxpayer containing details of the business activities carried out and the location of business activities
For those whose business activities use a virtual office, additional required documents such as:
- Documents showing the contract or agreement between the Virtual Office provider and the Employer.
- Documents containing business certificates from authorized officials or agencies
After the required documents are complete, the next step you need to take is to make a Taxable Entrepreneur Confirmation Letter in writing and fill out the forms and attachments to the requirements by post or expedition services with proof of mailing. However, you can also visit the Tax Service Office (KPP) or Taxation Service, Counseling, and Consultation Office (KP2KP) directly in the same area as your residence or place of business activity. The decision on the application will be sent no later than one day after the application is received in full. After the PKP status is obtained, you must request an electronic certificate and activate the PKP account, both forms of which can be downloaded on the tax.go.id page, no later than three months after being confirmed as PKP.
Benefits of PKP Status for Business Actors
After knowing the definition and requirements for applying for PKP, then you must be wondering, are there any benefits of PKP status for business actors? In addition to having rights and obligations, of course there are also various benefits that business actors feel if they hold the status of PKP. What are they?
Legalized Business
By holding PKP status, you have the advantage of proof that your business management has been carried out legally in the eyes of the law. In addition, this also indicates that your business has good tax compliance.
Credibility of the Established Business
PKP status will also increase the credibility of business actors and their value in the industrial world. This is because the application for PKP itself can only be done by business actors who carry out their tax obligations in an orderly manner.
Big Business Cooperation Opportunities
In addition to legal business and credibility, the PKP status will also provide opportunities and rights for transactions with government treasurers and participating in auctions held by the government.
Improving Production Efficiency
By holding the status of PKP, economically the burden of production and investment in the BKP and JKP owned will be borne by the end consumer, so that the financial circulation is healthier.
KH Contact
How about KH friend? With some of the benefits and rights that have been explained, it is no wonder that many business people want PKP status? Considering that the benefits felt can also have an impact both in the short and long term, there is no reason to delay the arrangement! Well, to help make tax administration more effective, you can also use the services of Kontrak Hukum. We provide Digital Business Assistant (DiBA) services that since 2018 have been trusted by thousands of companies as partners to fulfill legal and tax needs at affordable and efficient prices. By visiting https://kontrakhukum.com/digital-assistant/, you can enjoy business services ranging from contract drafting, accounting, and tax in just one place with DiBA from Kontrak Hukum. For more information, you can also contact Kontrak Hukum through the following link Tanya KH. With DiBA, #Semuajadiberes!
