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Tax Glossary
NPWP (Tax Identification Number)
NPWP (Nomor Pokok Wajib Pajak), or Tax Identification Number in English, is a unique 16-digit identifier issued by Indonesia's Directorate General of Taxes (DJP) to every taxpayer for tax administration purposes. Governed by Article 2 of Law No. 28/2007 on General Tax Provisions and Procedures (UU KUP). Since January 1, 2024, per Ministry of Finance Regulation No. 112/PMK.03/2022, NPWP integrates the National Identification Number (NIK) for individual resident taxpayers. Without an active NPWP, taxpayers face income tax withholding at 120% of the normal rate (Article 21 paragraph 5a of Law No. 36/2008 on Income Tax). NPWP is mandatory for: (1) Individuals with income above the non-taxable threshold (PTKP), (2) Entrepreneurs conducting business in Indonesia, (3) Recipients of various income sources. An NPWP is required to file tax returns, claim refunds, transact with government agencies, and open bank accounts.
Tax Glossary
DJP Online
DJP Online (djponline.pajak.go.id) is the official portal of Indonesia's Directorate General of Taxes (DJP) providing electronic tax services to taxpayers. Governed by Regulation of the DJP Director No. 2/PJ/2019 on Procedures for Submitting, Receiving, and Processing Tax Returns. Core services include: 1. e-Filing: Electronic submission of annual and monthly tax returns, 2. e-Billing: Generation of payment codes for tax payments, 3. e-Form: Interactive PDF-based tax form completion, 4. NPWP Status Check: Verification of NPWP status and domicile, 5. SPT Tracking: Monitor return filing and verification process. Access requires an active NPWP and activated EFIN. DJP Online operates 24 hours a day, 7 days a week and is free for all registered taxpayers.
Tax Glossary
PTKP (Non-Taxable Income Threshold)
PTKP (Penghasilan Tidak Kena Pajak / Non-Taxable Income Threshold) is the annual income level below which individual resident taxpayers owe no income tax. Governed by Article 7 of Law No. 36/2008 on Income Tax (UU PPh) and Ministry of Finance Regulation No. 101/PMK.010/2016. Current PTKP amounts (effective January 1, 2016 and continuing): Self: Rp 54,000,000 per year (Rp 4,500,000 per month), Additional for married status: Rp 4,500,000, Additional per dependent (child or spouse): Rp 4,500,000 each (maximum 3 dependents). PTKP status is denoted by codes: TK (Single), K (Married), K/I (Married with earning spouse), I (Spouse earning). Income below PTKP incurs zero income tax liability, but taxpayers holding an NPWP must still file an annual return even when tax liability is zero.
Tax Glossary
Taxpayer
A Taxpayer (Wajib Pajak) is any individual or entity, including tax payers, withholding agents, and tax collectors, that holds tax rights and obligations under Indonesian tax law. Defined in Article 1 paragraph 2 of Law No. 28/2007 on General Tax Provisions and Procedures (UU KUP). Individual Taxpayers include any person with income above the non-taxable threshold (PTKP) from any source: employment, business, investments, or other sources. Citizenship is not a determining factor; both Indonesian residents and foreign nationals domiciled in Indonesia can be individual taxpayers. Corporate Taxpayers (Wajib Pajak Badan) include all legal entities established or domiciled in Indonesia, such as: Limited Liability Companies (PT), Partnerships (CV), Firms, Cooperatives, Foundations, and other legal entities. Corporations must pay income tax (PPh Badan) on net profits. Core taxpayer obligations: (1) Register and obtain NPWP, (2) Calculate tax liability, (3) Pay taxes on time, (4) File annual returns and supporting documents.
Tax Glossary
EFIN (Electronic Filing Identification Number)
EFIN (Electronic Filing Identification Number) is a 10-digit identification code issued by Indonesia's Directorate General of Taxes (DJP) to taxpayers, serving as the activation code for electronic tax services including e-Filing, e-Form, and e-Billing on the DJP Online portal. Governed by Regulation of the DJP Director No. 41/PJ/2015 as amended by No. 32/PJ/2017. EFIN is confidential and personal; each taxpayer receives one EFIN for life (while registered active with DJP). To obtain an EFIN, the taxpayer submits a request to the registered Tax Service Office (KPP) in person with photocopies of ID and NPWP card, or through DJP-approved channels such as the Coretax application. EFIN differs from a password: EFIN is the identifier, while a password (PIN/access code) is additional security typically created by the taxpayer on first login.
Tax Glossary
Article 23 Income Tax (PPh 23)
PPh 23 (Article 23) is withholding tax on dividends, interest, royalties, prizes, rent, and technical/management/consulting fees paid by entities to domestic taxpayers or PEs. Governed by Article 23 of the Income Tax Law and PMK No. 141/PMK.03/2015. Rates: 15% on dividends, interest, royalties, and prizes; 2% on rent and certain service fees. Without an NPWP, rates double. PPh 23 is non-final and can be credited by the income recipient on their annual return.
Tax Glossary
Annual Tax Return (SPT Tahunan)
The Annual Tax Return (SPT Tahunan) is the official form used by taxpayers to report all income, assets, liabilities, and tax calculations for a tax year to Indonesia's Directorate General of Taxes (DJP). Governed by Article 3 paragraph (1) of Law No. 28/2007 on General Tax Provisions and Procedures (UU KUP). Filing deadlines: March 31 for individual taxpayers and April 30 for corporate taxpayers (Article 3 para. 3, UU KUP). Filing is done through DJP Online using e-Filing or the official Coretax application. Late filing incurs penalties of Rp 100,000 for individuals and Rp 1,000,000 for entities (Article 7 para. 1, UU KUP). The return must be filed even if income is zero, below the non-taxable threshold, or resulting in a loss, provided the taxpayer is registered with DJP. Supporting documents include withholding certificates (Form 1721-A1), tax payment proof (monthly SPT), and income documentation.