The Taxpayer Identity Number (TIN) is one of the important documents for citizens, both Indonesian citizens and foreigners working in Indonesia. It does not only function for tax matters but also as one of the administrative requirements. Taxpayers are not only individuals but also corporate taxpayers. For individual taxpayers, it consists of office workers or employees, freelancers, and entrepreneurs. Meanwhile, corporate taxpayers consist of government entities and private entities. In the current digital era, TIN does not have to be made through the Kantor Pelayanan Pajak (KPP) but can also be done online through the DJP website to get a digital one.
This article will explain about TIN in details.
Taxpayer Identity Number or Tax Identification Number (TIN), known as Nomor Pokok Wajib Pajak (NPWP) in Indonesia, is the number given to the taxpayer, or Wajib Pajak (WP) in Indonesia, for tools in tax administration as identification or identity of the taxpayer in fulfilling his rights and obligations. Besides Taxpayer’s Identity, TIN or NPWP has the function of maintaining discipline and compliance with tax payments as well as supervision of the tax administration of taxpayers.
Each taxpayer is only given one NPWP. The NPWP consists of 15 digits; the first 9 are taxpayer code information, and the last 6 are administrative code information.
According to NPWP’s type, a Taxpayer Identity Number is owned by an individual and business entity.
A Taxpayer Identity Number is an important document for tax purposes and administration requirements. In detail, they are used for:
Indonesian residents are required to have a Taxpayer Identity Number by the Indonesian Tax Office (Direktorat Jenderal Pajak). People can apply for NPWP online or offline.
Taxpayers must register at the Tax Service Office or KPP (Kantor Pelayanan Pajak) in their city of residence to get their Taxpayer Identity Number offline. Expats who reside in Jakarta must register with the Tax Office for Foreign Bodies and Expatriates or Kantor Pelayanan Pajak dan Orang Asing (KPP BADORA). After completing the registration form, taxpayers have to prepare several documents, which also depends on the type of taxpayers.
After the KPP receives all registration application requirements, the KPP issues a Letter of Receipt (Bukti Penerimaan Surat). KPP issues NPWP Card and Surat Keterangan Terdaftar (SKT) no later than 1 (one) working day after the Letter of Acceptance is issued. NPWP and SKT are sent by Registered Post.
People can use the https://pajak.go.id/ website to register for an NPWP online by creating an online DJP account first. Taxpayers must register via https://ereg.pajak.go.id/daftar by using an active email, then complete the requested data such as the type of taxpayer (personal or corporate), name, email address, mobile number, password, and others. After activating the account, the DJP account has been created.
After activating and creating the account, taxpayers must complete the registration form and upload the documents on the website. After the NPWP application form is Complete, taxpayers can Request a Token and Send the NPWP application. A digital NPWP is made after the application is complete, registered, and sent to the taxpayers’ address.
Taxpayers (Wajib Pajak) are individuals or entities with the ability to pay taxes, withhold taxes, and collect taxes and have rights and obligations related to taxation under applicable regulations. Every citizen or business entity can obtain Taxpayer Identity Number. People or companies can register to get a Taxpayer Identity Number or NPWP anytime. Individual applicants can register when they are 17 or 18 (having an ID Card or KTP).
Some people are not old enough (adolescents) but have income above Penghasilan Tidak Kena Pajak (PTKP), such as child actors, child singers, or models. Everyone who meets the Objective and Subjective requirements is obliged to carry out his tax obligations. Subjective requirements are if you have been born into the world and resided in Indonesia for more than 183 days within 12 months. Then the objective requirement is if the person has income above PTKP. According to the UU PPh No. 36 Tahun 2008 Pasal 7: “The income of an immature child from whatever source of income and the nature of the work is combined with the income of his parents in the same tax year.”
However, NPWP Holder can not automatically be a taxpayer. There are some criteria for becoming a taxpayer:
There are several conditions that made an individual or business is deemed/eligible as a tax resident in Indonesia or the other way around, a non-tax resident of Indonesia. An ignorance of those terms and conditions of can result in fines and wrongly fulfilled tax obligations. With thorough knowledge in Indonesia Tax Law, Putranto Alliance can help you determined your eligibility as Indonesia tax residence.
We can help you and your business in obtaining Taxpayer Identity Number (TIN/ NPWP – Nomor Pokok Wajib Pajak) or relinquish it once you cease your business operation in Indonesia, which necessitate a tax audit by Tax Authority that we can also help you out with. We are also offering other services related to TIN services such as changes in address or applying of TIN for your branch office.
Annual Tax Return (SPT) is a letter used by the taxpayer to report the calculation and/or payment of taxes, tax objects, non-tax objects, and/or assets and liabilities following the provisions of tax laws and regulations. SPT can be in the form of paper (hard copy) or electronic documents (e-SPT or e-Filing)
The subject of personal income tax is a person or party responsible for income tax received or earned in a Fiscal Year or part of a Fiscal Year. The subject of income tax is a person who has to pay PPh and is referred to as a Taxpayer (WP), which is determined through the ownership of a Taxpayer Identification Number (NPWP).
The Kantor Pelayanan Pajak (KPP) is a work unit of the Directorate General of Taxes in charge of serving public taxation. The Tax Service Office relates to the taxpayer as an agency of the DJP. The Kantor Pelayanan Pajak consists of KPP Madya and KPP Pratama.
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