Low-Risk PKP Guide: Criteria, Coretax Application, and the Accelerated VAT Refund

Summary

A Low-Risk Taxable Enterprise (PKP Berisiko Rendah) is a category of VAT-registered business confirmed by Indonesia's Directorate General of Taxes (DGT) under Article 9(4c) of the VAT Law. Once granted, the status carries a powerful right: whenever the business has excess input VAT, the DGT must refund the overpayment through an advance refund process based on document research rather than a full field audit. Following PMK 28 of 2026, effective 1 May 2026, all prior designations issued under PMK 39/2018 are cancelled and new applications must be submitted through the Coretax platform.

This guide explains who qualifies, the legal foundation, the application steps, a worked example, and the operational pitfalls that lead to refusals.

What a Low-Risk PKP Is

A Low-Risk PKP is a VAT-registered taxpayer that the DGT considers low-risk based on specific characteristics, enabling an accelerated VAT refund route. The assessment is not automatic. The taxpayer applies for a designation, and the DGT issues a decision after researching supporting documents. The status is procedural rather than a rate incentive: it improves cash flow timing when input VAT consistently exceeds output VAT (for example for exporters, capital-intensive manufacturers, or thin-margin distributors).

The regime sits alongside but is distinct from Qualified Taxpayers under Article 17C of the KUP Law and Eligible Taxpayers under Article 17D. All three categories share the advance refund facility, but Low-Risk PKP applies specifically to VAT, while the other two cover both income tax and VAT. In practice, a business that only needs faster VAT refunds can pursue Low-Risk PKP status without meeting the broader compliance indicators of a Qualified Taxpayer.

Legal Basis

The Low-Risk PKP facility rests on several interlocking regulations:

1. Law Number 42 of 2009 (VAT Law), Article 9(4c). The substantive basis confirming that certain PKPs may receive advance VAT refunds.
2. Law Number 7 of 2021 (HPP Law). Harmonises VAT and KUP procedures and modernises the VAT compliance infrastructure.
3. Minister of Finance Regulation Number 28 of 2026. The current implementing regulation, replacing PMK 39/PMK.03/2018 and its amendments (most recently PMK 119/2024). Articles 15 through 22 cover Low-Risk PKP rules, while Article 38 sets out the transitional provisions.
4. The relevant Director General of Taxes Regulation (PER-DJP) that defines the Coretax application form and workflow.
5. DGT Circular Letters (SE-DJP) that explain internal risk parameters and document research criteria.

The DGT confirmed the legal foundation in its official article PMK-28/2026: Transformasi Pengembalian Pendahuluan Pajak Berbasis Kepatuhan on pajak.go.id. That article also emphasises that the new approach is compliance-based rather than purely administrative legalism.

Eligibility Criteria

Under PMK 28/2026, the following categories may be designated as Low-Risk PKPs:

• Public companies (issuers) whose shares are listed on the Indonesia Stock Exchange, with minimum public ownership in line with OJK rules.
• State-Owned Enterprises (BUMN) and Regional-Owned Enterprises (BUMD).
• BUMN subsidiaries majority-owned (over 50%) by the parent BUMN.
• Main Customs Partners (MITA) designated by the Directorate General of Customs and Excise (DGCE).
• Authorized Economic Operators (AEO) with valid DGCE certification.
• Manufacturers operating their own production facilities (registered in DGT systems) and meeting at least 12 months of VAT compliance history.
• Large pharmaceutical wholesalers licensed by the Ministry of Health and registered with BPOM.
• Certain medical device distributors on the Ministry of Health list.
• PKPs that consistently perform tangible goods exports, intangible goods exports, or services exports.

Outside these categories, ordinary PKPs may still claim VAT refunds, but only through the standard route under Article 17B of the KUP Law, which goes through a full audit. The eligibility list is closed: a strong compliance track record alone does not unlock Low-Risk PKP status without category fit.

Compliance Profile DGT Reviews

In addition to category fit, the DGT examines a compliance profile before granting the status:

• Consistent VAT return filings for the last 12 months (no late or unjustified nil returns).
• No outstanding tax debt unless the debt is under formal objection or appeal.
• No tax criminal conviction in the past 5 years.
• Data consistency between issued tax invoices, reported invoices, and paid VAT.
• Prior VAT audit outcomes, if any, show no repeated material corrections.

A PKP can review this profile in its own Coretax compliance dashboard before applying, leaving time to fix arrears or late filings before submission.

Application Mechanism

The application flow under PMK 28/2026 is fully electronic:

1. The PKP logs in to Coretax using the director or designated tax PIC credentials.
2. Open the Low-Risk PKP designation menu and complete the digital form, attaching category proof (MITA decision, AEO certificate, BEI listing confirmation, and so on).
3. Upload compliance support: 12 months of VAT returns, balance sheet and income statement if requested, and a no-tax-debt confirmation.
4. The DGT performs document research rather than a field audit. The review focuses on document completeness and the Coretax compliance profile.
5. A decision is issued within 15 working days of a complete application. The decision letter is delivered to the Coretax inbox with a copy to the registered email.
6. The status is valid for 2 tax years and expires automatically unless the taxpayer files for renewal at least 30 days before the end date.

PMK 28/2026 also introduces a transition window: PKPs that previously held Low-Risk status under PMK 39/2018 must reapply between 1 and 10 June 2026. Missing the window means losing the status and routing any future overpayment through the standard refund process.

Rates and Deadlines

There are no special tax rates tied to Low-Risk PKP status because the facility is procedural. The deadlines to watch are:

• Application: any time during the tax year, except for PMK 39/2018 holders who must use the 1-10 June 2026 window.
• DGT decision: 15 working days from a complete application.
• Refund filing after designation: through the monthly VAT return, marking the advance refund option.
• Advance refund disbursement: up to 1 month for Low-Risk PKPs, much faster than the standard route under Article 17B of the KUP Law, which can reach 12 months.
• Renewal: at least 30 days before expiry.

How to File and Claim a Refund

Once designated, a Low-Risk PKP files for a VAT refund through the monthly VAT return:

1. Calculate the input VAT excess over output VAT for the period. Ensure all input tax invoices are validated and matched in Coretax.
2. Open the monthly VAT return in Coretax. Select the refund (overpayment to be returned) option.
3. Select Advance Refund based on Article 9(4c) of the VAT Law.
4. Submit the return with the input and output tax invoice annexes. Coretax runs automated validation.
5. The DGT issues a Tax Overpayment Assessment Letter (SKPLB) based on document research, and the refund is disbursed to the taxpayer's bank account within one month from the date of the complete filing.

If the research identifies discrepancies (for example unmatched input tax invoices), the DGT issues a Data and Information Explanation Request Letter (SP2DK) before determining the refund amount.

Worked Example

PT Sehat Sentosa is a large pharmaceutical wholesaler licensed by the Ministry of Health and obtained Low-Risk PKP designation on 15 June 2026 through Coretax. For the July 2026 tax period the company recorded:

• Output VAT: IDR 8,000,000,000
• Input VAT: IDR 11,500,000,000
• Overpayment: IDR 3,500,000,000

On the July 2026 VAT return PT Sehat Sentosa selected the refund option with the advance refund mark. The DGT performed document research on the tax invoices. The SKPLB was issued on 22 August 2026 and IDR 3,500,000,000 reached the company's bank account on 28 August 2026, roughly 28 working days after the return was filed.

Without Low-Risk PKP status, the same refund would have flowed through Article 17B of the KUP Law with a full audit, possibly extending to 12 months. For a company with tight liquidity, that 11-month delta can be the difference between healthy operations and being stuck waiting for cash.

Common Reasons Applications Are Denied

Frequent issues that lead to refusal:

• Outdated category proof (for example an expired AEO certificate).
• Compliance profile shows a small VAT filing delay in the last 12 months with the penalty unpaid.
• The Coretax credential holder is not the director or authorised PIC, so the filing is treated as invalid.
• Outstanding income tax debt unrelated to VAT (the DGT reviews compliance across all tax types).

Each of these can usually be corrected within 1 to 2 weeks, so applicants who prepare early still have room to revise before submitting.