Tax Collection and Administration for Non-resident Taxpayers | Indonesian Tax Guide 2025 (40)
Indonesia
Non-resident taxpayers
2025-03-11 09:11:44
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This issue's introduction
Tax management of non-resident enterprises
Tax Administration Agency
Brief Introduction to Non-resident Tax Collection and Administration Measures
Non-resident taxpayers need to submit the following materials for tax registration and obtain a taxpayer identification number:
(2) Indonesian temporary residence permit and business license.
Non-resident taxpayers are not allowed to register for VAT purposes and therefore do not need to file a VAT return. However, if a non-resident taxpayer sells taxable goods or services in Indonesia through a permanent establishment, it is necessary to register as a VAT taxpayer. A permanent establishment is considered a resident taxpayer and is subject to the relevant regulations for resident taxpayers.
If a non-resident taxpayer who does not have a permanent establishment or subsidiary in Indonesia engages in taxable transactions with a resident taxpayer, the resident taxpayer shall bear the management responsibility for the VAT payable. If the non-resident taxpayer is the buyer, the VAT must be collected by the resident taxpayer; if the non-resident taxpayer is the seller, the VAT must be self-assessed and paid by the resident taxpayer.
A permanent establishment that has been registered as a VAT taxpayer and has a total turnover of not more than IDR 4.8 billion can choose to register for VAT.
Non-resident taxpayers are not required to appoint a fiscal representative in Indonesia, but when taxpayers purchase intangible goods or services from abroad, if VAT is paid by the seller, the general principle cannot be applied.
Therefore, whether or not it is a VAT taxpayer, the purchaser in Indonesia is responsible for calculating and withholding the VAT payable on such transactions, and submitting VAT returns and paying taxes to the tax office.
The excitement continues in the next issue...