At the beginning of each year, taxpayers, both individuals and corporations, are required to self-report the tax payable in the form of an Annual Tax Return (SPT). This time, the reporting is for the 2023 SPT. Referring to the Law on General Provisions and Tax Procedures (KUP), otherwise known as Law No. 7 of 2021 concerning Harmonization of Tax Regulations, individual taxpayers are required to report their annual tax return no later than three months after the end of the tax year or March 31, 2024. Meanwhile, for corporate taxpayers, the annual SPT is no later than four months after the end of the tax year or April 30, 2024. However, the Directorate General of Taxes emphasized that the 2023 Annual Tax Return reporting can be done as of January 1, 2024. Well, for personal and corporate taxpayers who are late in reporting or even not reporting the Annual Tax Return at all, they will be subject to sanctions. Unmitigated, the sanctions imposed can be in the form of administrative fines to criminal penalties. This is as stated in Article 39 of the KUP Law.
What is an annual tax return?
Annual Tax Return (SPT) is a letter used by taxpayers to report all forms of tax calculation and/or payment, both for tax objects and non-tax objects. In addition, the Annual Tax Return can be used to report assets and liabilities in accordance with the provisions of the applicable laws and regulations. Annual Tax Return itself has 2 (two) types, namely Annual Individual Tax Return and Annual Corporate Tax Return. Annual SPT reports must be made every year for the previous tax year. For example, the 2023 Annual Tax Return period is reported in 2024, and so on. Provisions regarding the reasons for tax reporting are contained in Law No. 7 of 2021 concerning Harmonization of Tax Regulations. The Annual Tax Return is a means for citizens who already have an NPWP to report and account for the calculation of the amount of tax for the past year.
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In addition to reporting the calculation and/or payment of tax on income, the Annual Tax Return also reports all tax objects and/or non-tax objects as well as assets and liabilities in accordance with tax law.
Annual Tax Return Submission Procedure
Since January 1, 2013, there are several ways or procedures for taxpayers to be able to submit Annual Tax Return. This provision has been regulated in the Regulation of the Director General of Taxes Number PER-02/PJ/2019 concerning Procedures for Submitting, Receiving, and Processing SPT.
Directly
Referring to Article 9 PER-02/PJ/2019, direct submission of Annual Tax Return can be done at the place where the taxpayer is registered, or other places in the form of out-of-office tax services provided by the KPP or KP2KP where the taxpayer is registered.
By Post, Expedition Service, or Courier Service
Referring to Article 10 Article 9 PER-02/PJ/2019, the submission of Annual Tax Return by post, expedition service, or courier service with proof of mailing can be submitted to the Tax Office where the taxpayer is registered or other places determined by the DGT. Meanwhile, taxpayers must submit one Annual Tax Return in a sealed envelope accompanied by one proof of mailing. The envelope is affixed with several information, namely NPWP, type of tax return, tax year, and tax return status. Taxpayers must also provide information on the proof of mailing consisting of name and NPWP, type of tax return, and tax year.
Through e-Filing
Submission of e-Filing through the DGT Online website can be done for individual and corporate taxpayers who use Annual Tax Return Forms 1770 S, 1770 SS, 1770, and 1771. In addition to e-Filing, Annual Tax Return submission can also be done through e-Form. Taxpayers are advised not to report at the end of the deadline, March 31, 2024 for individuals or April 30 for entities. The reason is, if done at the end of the reporting deadline, it is feared that there will be obstacles, such as network problems, the SPT reporting will be late.
What are the Sanctions for Late and/or Non-Reporting Annual Tax Return?
The government has set sanctions for taxpayers who are late in reporting or even not reporting the Annual Tax Return at all, ranging from administrative fines to criminal sanctions. This is as stated in Article 39 of the KUP Law which emphasizes that every person deliberately does not submit a tax return or submits a tax return and / or information whose contents are incorrect or incomplete so that it can cause losses to state revenue is subject to criminal sanctions. “The sanction is imprisonment for a minimum of 6 months and a maximum of 6 years and a fine of at least 2 times the amount of tax payable that is not or underpaid and a maximum of 4 times the amount of tax payable that is not or underpaid,” the article states. Adaun, administrative sanctions for not reporting the Annual Tax Return are also contained in article 7 paragraph (1) of the KUP Law, which is as follows:
- Penalty of IDR1,000,000 for Corporate Income Tax Return.
- Penalty of IDR100,000 for Individual Taxpayer Income Tax Return
Keep in mind, if taxpayers are late in depositing the fine money, then the fine can increase again. The addition of the fine fee follows the Bank Indonesia (BI) benchmark interest rate and then adds 5% divided by 12 months. This provision has changed from the previous 2% per month, where this regulation is contained in the provisions in Law (UU) Number 11 of 2020 concerning Job Creation. Therefore, it is best to report the Annual Tax Return as soon as possible before the reporting deadline or apply for an extension of time if needed to avoid late fees.
KH Contact
That is the review of the sanctions for negligence in reporting the Annual Tax Return either intentionally and/or unintentionally late and even not reporting it at all. So, what are you waiting for? Immediately report the Annual Tax Return before March 31, 2024 for individuals and April 30, 2024 for entities! To make it easier, just leave it to a Legal Contract. In order to bring convenience in managing taxation, Kontrak Hukum presents the first subscription service in Indonesia Digital Legal Assistant (DiLA).
READ ALSO: End of April, Deadline for Annual Corporate Tax Return Reporting, Here’s How to Report It
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 – DiLA page. If you have any other questions, you can also consult for free via Ask KH or send a direct message (DM) to Instagram @kontrakhukum. With KH, #semuajadiberes!
