The principles of accounting in Indonesia and the local regulations for financial statement submissions are mandatory for all those who open a company here. Our team of Indonesian accountants can provide expert assistance and guidance to meet all the ongoing requirements.
| Quick Facts | |
|---|---|
| Accounting principles | Indonesian Generally Accepted Accounting Principles (GAAP) |
Auditing rules | Only for certain types of companies (such as public companies) |
Taxable income | – business income, – asset sales gains, – passive income |
| Corporate tax rate | 22% |
| Dividend taxation | – no witoholding tax for dividend payments made by an Indonesian company to a resident company; – a 10% final withholdign tax can apply for dividends paid to an Indonesian resident individual, in some cases |
| Losses | Tax losses can be carried forward for five years; subject to conditions |
| Tax year | The calendar year |
| Consolidated returns | Not permitted |
| Annual filing | Within 4 months from the end of the accounting year in most cases |
| Payment | The annual corporate income tax payments are made before the tax return is filed |
| Penalties for late/incomplete tax filing or underpayment | Charged at variable rates |
| VAT registration threshold | For delivering goods/services exceeding IDR 4.8 billion in one fiscal year |
| VAT rates | 11% (as of April 2022) |
| VAT filing | Monthly |
| VAT payment | Before filing the monthly VAT return |
Table of Contents
When must I hire an accountant in Indonesia?
If you open a company in Indonesia, you must be prepared to hire an accountant as soon as the business starts trading. There are no exceptions to financial reporting and tax filings, so active businesses are required to meet all the conditions irrespective of their type or how long they have been operating.
What accounting services do you offer in Indonesia?
Our certified public accountant (CPA) in Indonesia, can assist you with the following once you open a company in the country:
- Financial reporting: preparing the financial statements according to the Indonesian Accounting Standards, also referred to as SAK Indonesia;
- Tax minimization and planning solutions;
- Payroll and HR services for companies;
- Tax filing services with the Directorate General of Taxes;
- Accounts payable and accounts receivable services;
- VAT registration and filing.
Do you provide specialized solutions such as forensic accounting?
Upon request, our team can assist Indonesian companies requiring highly specialized investigative accounting services. Forensic accounting can be used in cases involving:
- Business disputes: breach of contract that involves missed payments or insufficient payments as per a previously signed agreement;
- Fraud and crime: from simple cases to more complex ones in areas such as: embezzlement, tax evasion, or money laundering;
- Business issues: in the case of bankruptcy or insurance claims. Investigative accounting services can also be used as part of the due diligence process when buying a company in Indonesia.
Please watch our video on our accounting services in Indonesia:
Can you help me with financial planning and analysis?
Yes. As needed for our corporate or individual clients, we can assist with budgeting or oversight and relevant controls. Some of the types of assessments we can provide include:
- Financial ratio analysis: profitability, efficiency and liquidity metrics;
- Pattern analysis: identifying any financial performance patterns that may be relevant to your company in Indonesia;
- Cash flow analysis: to accurately track the money moving in and out of your business;
- Comparative analysis: this type of evaluation will provide you with a side-by-side report for multiple periods in your company’s history. It can be used for tracking performance or to ensure that you meet the regulatory requirements, among others.
What are the main tax compliance requirements for companies?
Business owners should keep in mind the following:
- The standard fiscal year in Indonesia is the calendar year. The use of any other fiscal year requires prior approval from the Directorate General of Taxes;
- Companies file separate tax returns. Consolidated tax reports are not permitted;
- Monthly corporate income tax returns are filed by the 20th day of the following month;
- Annual returns are filed within four months of the end of the fiscal year.
If you want to work with an accountant in Indonesia from our team, please contact us for more information about our services and tax compliance for corporations.