Here Is a Simple Guide on How to Submit Your Tax Return, Stress-Free
BY :ADINDA NORMALA
MARCH 22, 2018
Jakarta. It is tax season, and 14 million individual taxpayers must fill and submit their tax reports. So far, 6.1 million reports have been filed, and the remaining taxpayers have until Mar. 31 to fulfill their obligation.
In the past four years, the tax office has introduced online tax return services with step-by-step guides on filling out their taxes. The online form typically takes 30 minutes to complete, a much better alternative than having to drag oneself to the nearest tax office and spend hours in queue just to submit the return.
The service, however, is only available in Indonesian for now, but under a tax office plan, an English version should be released toward the end of year.
One should not wait until the end of year to submit the tax report though, because failure to report by the deadline carries a Rp 100,000 ($7.50) fine.
Why do you still need to submit a tax return after all of your taxes have been deducted from your paycheck salary? The short answer is that the law of the land says so. Long answer: In the past, the tax office used to calculate and determine a citizen's tax, a system it inherited from the Dutch colonial era. A tax law reform in 1983 transferred the power to determine respective taxes to taxpayers themselves. With that also came the responsibility to report your calculations to the tax office.
So, what must you prepare to fill in the tax return report?
If this the first time you have filled out an online tax return, you will need an Electronic Filing Identification Number, or e-fin, which will be used to create your account on the online filing website.
The efin can be obtained by filing out an activation form, which can be downloaded here, and submitting it to your nearest tax office. It is imperative to come to the office yourself, as tax officials will not grant any requests for a stand-in or representative.
The office will ask you to provide an active email address, identification card (KTP) for Indonesians or Limited Stay Visa for foreigners and its copy, as well as a copy of your tax identification number (NPWP).
After obtaining the e-fin from the tax officer, you can activate it through this page. The tax office will then send a confirmation to the email address you registered. The email will contain a temporary password that must be changed immediately.
Documents you must bring with you to the tax office include the income tax deduction document, known as a 1721 form, that you receive from your employer. It contains your tax identification number NPWP and that of your employer.
You should also bring your December credit card bill, mortgage documents, house and land certificates, receipts from donations and loan agreements for your vehicles, as you will be asked to provide information about your assets and debts. For married ones, prepare your family card as you need to fill in your spouse's and children's ID numbers.
Start Filling Your Tax Return Report
Armed with all the data you have prepared above, you can begin to fill out your tax return report online by first going to the online filing website. Enter your tax identification number and password you selected earlier, and you will arrive at the home screen, which will show your basic information on the left and several options on the right.
Click the e-filling button that will bring you to the next screen and which, if you have filed online last year, should show your previous tax return. To make a new return, click the "make SPT" button on the right-hand side of the screen.
You will find several questions, and depending on your answer, you will arrive at a final question that will ask you how you would like to fill out your tax return. Choose the second option and click the orange button at the bottom which allow you to fill out the report.
On the next page, you will start the 18-step process to fill in the tax return. Some of the steps will be straight forward:
- Enter the tax year 2017 with normal SPT status.
- You are required to provide information of all taxes that have been deducted from your income. You can fill the income tax by clicking the add button first. In the small window that appears, fill in the tax identification number of the tax deductor (usually your company) and the date of the tax deducted. All of this can be found on your income tax deduction receipt given by your company. If the company’s tax identification number is correctly filled in, its name will appear. Then, enter the amount of income tax that has been deducted from your paycheck. For the employee tax receipt form 1721-A1, you can check it on the 20th line. Enter the number and click save, then click next step.
- Usually this column will be filled automatically with data from the previous step. Or you can fill with item number 14 from the 1721-A1 form.
- This is where you report income from interest, royalties, rents or gains from selling your assets. Gains from selling shares on the stock market should not be listed here.
- Then you can continue by entering total income from foreign countries if any. No details required.
- The next step is income that is not taxable, like inheritances or allowances from your parents. Even if it is not taxed, data on inheritance should be included in your tax report. The tax office will compare your income and debt data with assets you reported to gauge how reasonable the state of your wealth and tax payments are.
- You then need to fill in your income that is subjected to final income tax. This is where you report your stock market gains, or rents of land and properties.
- You will be asked to fill in data about owned assets such as real estate properties, land, cars or motorcycles. Report the year you acquired the assets and their purchase prices, not the current price. Starting this year, you must not leave this section empty, or the tax office will refuse to accept your tax return. So, you are advised to include your bank savings and electronic gadgets, such as handphones or laptops.
- Then on your debt, put the data changes, including mortgage debt reduction.
- Next is the family dependent data, in which you must fill in the names, identification cards, statuses and work of the family members who depend on you. Save the data and continue filling your report.
- Next, fill in donations, or zakat for Muslims, you made in the past year, which can be deducted from your total taxes. However, the tax office only recognizes donations to official and registered institutions. These include Badan Amil Zakat Nasional, Dompet Dhuafa Republika, Yayasan Rumah Zakat Indonesia, Badan Dharma Dana Nasional Yayasan Adikara Dharma Parisad and Indonesia Christian Religion Fund (Lemsakti).
- Fill in the status of tax liability by choosing a marital status. Then, select the non-taxable income group. If you are married, choose married and if there are dependents, select the number of dependents, such as 1-3 people.
- The next step is tax refunds from abroad.
- Next question is whether you pay income tax on a business that you run. If not, just click the next step button.
- Next is the tax calculation. If you are an employee and you have paid your taxes through your company, then there is no need for any tax payment because it is paid accordingly. If not, there will be a notification that your tax has not been paid.
- In this step, you will be asked to pay any tax amount that is still due. If you have not paid your taxes yet, create a tax billing code. Tax billing codes can be made online through this page, or via your handphone by accessing *141*500#. After getting the billing code to pay, you can submit your tax payment at your local bank. If you pay more than you have to, you can apply for a refund. This process can take up to 12 months, as your tax report will then be audited.
- A statement will subsequently appear: "Being fully aware of all its consequences, including sanctions, in accordance with the law, I declare that what I have filled above is true, complete and clear." Make sure you have submitted a complete tax report.
- Next, submit your tax report and ask for the verification code. The code will be sent through email. Check your inbox, enter the verification code, then click send the SPT button.
Should you have any questions, contact the call center at 1500-200, or tweet your questions to @kring_pajak on Twitter during working hours from 8.00 a.m to 4.00 p.m.