Annual Tax Return (SPT Tahunan) is a letter that must be reported by every taxpayer to the government through the Directorate General of Taxes (DGT).
Its function is as a means of reporting the calculation and / or payment of taxes starting from tax objects and / or non-tax objects, as well as assets and / or liabilities in accordance with applicable laws and regulations.
As a business entity that has been registered as a taxpayer and has a Taxpayer Identification Number (NPWP), submitting the Annual Tax Return correctly, completely and clearly is a must.
The type of Annual Tax Return in question is Annual Tax Return Form 1771.
The Annual Tax Return contains income, expenses and calculation of income tax (PPh) payable within one tax year.
The submission of this Annual Tax Return is considered important and influential for several reasons, namely:
Payable Tax Audit Tool
The Annual Tax Return is a tool for checking the correctness of the calculation of tax payable notified by the taxpayer.
The Annual Tax Return must be reported because there is a possibility that taxpayers get other income such as investments and others.
In addition, there is a possibility of additional assets that occur within a year such as the purchase of land, houses or apartments in the current year.
In essence, reporting the Annual Tax Return is required because it is to check the assets registered with the assets actually owned by the taxpayer.
Proof of Compliance
Taxpayers who have reported the Annual Tax Return online, it will be recorded and stored in the system.
This can be used as evidence that taxpayers are not absent from the obligation to declare taxes and is useful in the event of a tax dispute.
Favorable, isn’t it?
Annual Tax Return reporting can also be a benchmark for the government in seeing the success of a taxation system.
A tax system is said to be successful as seen from the compliance of taxpayers to fulfill their obligations voluntarily.
Based on data from the DGT towards the end of 2020, the formal tax compliance rate was recorded at 76.86%.
The tax authority targets the 2020 Annual Tax Return compliance ratio of 80% of a total of 19 million taxpayers registered as corporate and individual taxpayers.
The deadline for reporting individual tax returns has been set for March 31, 2021, while for corporate taxpayers it will end in April 2021.
Avoid Sanctions
Based on Law No. 16 of 2009, the fourth amendment to Law No. 6 of 1983 concerning General Provisions and Tax Procedures (KUP Law), the amount of sanctions imposed for corporate taxpayers who are late in submitting SPT is IDR 1,000,000 and for personal taxpayers is IDR 100,000.
If the taxpayer has paid but there is still tax payable or income tax underpayment, the tax is subject to an interest sanction of 2% per month.
Taxpayers who due to their negligence do not submit the Annual Tax Return or submit it but the contents are incorrect or incomplete, or attach information whose contents are incorrect so that it can cause losses to state revenue, are not subject to criminal sanctions but are subject to administrative sanctions if the negligence is first committed by the taxpayer.
In this case, the taxpayer must pay off the underpayment of the amount of tax owed along with administrative sanctions in the form of an increase of 200% of the amount of tax underpaid.
The imposition of criminal sanctions is possible to be implemented and is the last resort to improve taxpayer compliance.
This is as stated in Article 39 of the KUP Law which states that if the SPT is not submitted or the SPT is submitted by the taxpayer with information whose contents are incorrect or incomplete so as to cause losses to state revenue, criminal sanctions may be imposed, namely imprisonment for a minimum of 6 months and a maximum of 6 years.
While the fine is at least 2 times the amount of tax payable to a maximum of 4 times the amount of tax payable.
Trusted by the Public
A business entity or company that already has an NPWP and obeys the Annual Tax Return reporting must have no doubt about its credibility.
The company certainly feels safe to carry out business activities because it does not need to avoid the tax authorities.
If it is later proven that a company does not submit its Annual Tax Return and the news is published, won’t this have a bad impact on the company’s image?
Therefore, avoid things like this to protect the sustainability of the company.
Read also:
- Here’s How to Register EFIN Online, a Solution to Report Tax Return Without Hassle!
- How to File Annual Tax Return?
KH Contact
Since you already know its function and role, let’s report the Annual Tax Return according to the deadline.
It is not difficult to report the Annual Tax Return, because the letter can be submitted
It will be very unfortunate if KH Friend’s company has to lose money just because it does not comply with tax obligations.
Ready to do business, ready to deal with taxes!
Please contact Kontrak Hukum if you want to consult regarding business law.
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