What Is a Preliminary Tax Refund?
A preliminary tax refund (pengembalian pendahuluan kelebihan pembayaran pajak) is a facility that allows qualifying taxpayers to reclaim overpaid taxes without going through a full tax audit. It is often called "accelerated restitution" (restitusi dipercepat) in Indonesian tax practice.
Tax overpayments can arise for various reasons: tax credits exceeding tax due, miscalculated payments, or VAT input tax exceeding output tax. Without this facility, taxpayers must wait for a full audit that can take 12 months or longer. The preliminary refund mechanism issues the refund first, with the right of DJP to audit afterward.
Legal Basis
The preliminary refund facility has its legal foundation at both the statutory and regulatory levels:
- Article 17C of Law Number 6 of 1983 on General Tax Provisions and Procedures (KUP), last amended by Law Number 7 of 2021 on Tax Regulation Harmonization (HPP): statutory basis for qualified taxpayer refunds
- Article 17D UU KUP: statutory basis for taxpayers meeting certain requirements
- Minister of Finance Regulation Number 28 of 2026 (PMK 28/2026) on Procedures for Preliminary Tax Overpayment Refunds: technical rules effective 1 May 2026, replacing PMK 39/PMK.03/2018
Three Taxpayer Categories Under PMK 28/2026
Category 1: Qualified Taxpayers (Wajib Pajak Kriteria Tertentu)
This group covers taxpayers with a strong compliance track record. All of the following must be met (Article 4, PMK 28/2026):
- Annual tax returns (SPT) filed on time for the past 3 tax years
- Monthly returns filed for January through November of the last tax year before designation
- No outstanding tax debt (except debts under DJP-approved installment or deferral arrangements)
- Financial statements audited with an unqualified opinion (WTP) for 3 consecutive years
- No tax criminal conviction under a final court ruling in the past 5 years
Designation is applied for annually through Coretax DJP during 1-10 January of each year (Article 5, PMK 28/2026).
Entitlement: SKPPKP issued within 3 months for income tax (PPh) and 1 month for VAT (PPN) from receipt of the overpayment return (Article 7, PMK 28/2026).
Category 2: Taxpayers Meeting Certain Requirements
This category does not require prior designation. Taxpayers meeting the thresholds below are automatically eligible on a per-return basis (Article 9, PMK 28/2026):
| Taxpayer Type | Overpayment Limit |
|---|---|
| Individual not operating a business | No limit (any amount) |
| Individual operating a business | Max. Rp100 million (PPh) |
| Corporate taxpayer (turnover max. Rp50 billion) | Max. Rp1 billion (PPh) |
| Taxable Entrepreneur (supplies max. Rp4.2 billion) | Max. Rp1 billion (VAT) |
Entitlement: SKPPKP issued within 15 working days from receipt of the overpayment return (Article 11, PMK 28/2026).
Category 3: Low-Risk Taxable Entrepreneurs
This category includes entities considered to present low non-compliance risk (Article 15, PMK 28/2026):
- Listed companies on the Indonesia Stock Exchange (IDX)
- State-owned enterprises (BUMN) and regional government-owned enterprises (BUMD)
- Customs main partners and Authorized Economic Operators (AEO)
- Manufacturers, major pharmaceutical distributors, and certain medical device distributors
- Majority-owned BUMN subsidiaries
Designation as a low-risk PKP is valid for 2 tax years and must be renewed (Article 16, PMK 28/2026).
Entitlement: SKPPKP issued within 1 month from receipt of the VAT overpayment return.
How to Apply
Since PMK 28/2026 took effect, all preliminary refund processes must go through Coretax DJP. General steps for qualified taxpayers:
- Submit designation application: Log in to Coretax DJP, select the Qualified Taxpayer Designation menu. Standard period: 1-10 January each year.
- Receive designation decision: DJP issues a decision within 30 working days from receipt of a complete application (Article 6, PMK 28/2026).
- File overpayment SPT: When filing the return in Coretax, select the preliminary refund option.
- Receive SKPPKP: DJP issues the Preliminary Tax Refund Decision Letter within the applicable timeline.
- Receive funds: The refund is transferred to the taxpayer registered bank account.
After SKPPKP Is Issued
Receiving a preliminary refund does not close the case. DJP retains the right to audit within a defined period after the SKPPKP is issued. If the audit finds the actual overpayment was smaller, the taxpayer must return the excess plus interest (Article 17C(5) and 17D(5) UU KUP).
The interest rate references the benchmark rate set by the Minister of Finance.
Example
PT Maju Bersama is a corporate taxpayer with qualified taxpayer status. In the March 2026 VAT return, the company records a Rp500 million VAT overpayment because input tax from raw material purchases exceeded output tax from sales.
The company submits the overpayment return through Coretax DJP with the preliminary refund option selected. Under Article 7 of PMK 28/2026, DJP must issue the SKPPKP within 1 month of receiving the return. The Rp500 million is refunded to the company account without waiting for audit completion.
Six months later, DJP conducts an audit and concludes the actual overpayment was Rp450 million. PT Maju Bersama must return Rp50 million plus interest.