How to Arrange Your Electronic Filing (EFIN) to File Online Tax Reports in Indonesia?
More and more processes are being shifted online as this, generally, allows processes to become more efficient and easier to complete. This also applies to Indonesia's tax office. Over the past couple of years, tax can be filed online by legal entities and individuals. However, before an individual of company can file the tax online, he - or it - first needs to obtain an Electronic Filing Identification Number (EFIN).
Once an individual or legal entity has received a tax number (in Indonesian: Nomor Pokok Wajib Pajak), it is best to arrange the EFIN as soon as possible.
Who Needs to Pay Tax in Indonesia?
All legal entities that are incorporated - or domiciled - in Indonesia need to report tax to authorities (even if the entity does not have income or did not record any sales). A foreign company carrying out business activities through a permanent establishment in Indonesia will generally have to assume the same tax obligations as a resident taxpayer.
Meanwhile, an individual who resides in Indonesia for more than 183 days in a 12-month period also needs to fulfill his or her tax obligations each year.
For a detailed overview of Indonesia's tax system you can check PricewaterhouseCoopers' Indonesian Pocket Tax Book.
How to Arrange Your Electronic Filing Identification Number (EFIN)?
A. Legal Entities;
Either the director/owner of the entity comes to the nearest tax office, or, through a power of attorney, another person is authorized to submit the application at the tax office (make sure that the authorization letter has the so-called 'materai' or stamp duty).
The following documents need to be submitted:
- A letter (surat permohonan) - filled in and signed - requesting for the EFIN (the document also requires the entity's logo stamp)
- Copy of the entity's tax card (NPWP)
- Identity paper (and copy) of the director/owner (and the individual who is authorized to arrange the application process, if applicable). For an Indonesian individual: KTP, for a foreigner: KITAS and passport.
- Copy of the director/owner's tax card (NPWP)
- Copy of the entity's Deed of Establishment
B. Individuals;
Interestingly enough, it is not allowed for an individual to authorize another person to conduct the application process for the EFIN at the tax office. Thus, the individual needs to arrange it by himself/ herself at the tax office. However, we do know many cases where the expat did not arrange the EFIN by himself (which clearly goes against the tax office's rules, but apparently it is acceptable when it involves foreigners).
The following documents need to be submitted:
- A letter (surat permohonan) - filled in and signed - requesting for the EFIN
- Copy of the individual's tax card (NPWP)
- Identity paper (and copy) of the individual. For an Indonesian individual: KTP, for a foreigner: KITAS and passport.
If all documents are complete, then the tax officer will immediately issue the EFIN code for you or your company.