DGT Extends Account Reporting Time Related to AEoI

JAKARTA. The Directorate General of Taxes (DGT) provides relaxation for Financial Services Institution (Lembaga Jasa Keuangan/LJK) in submitting financial information as of 31 December 2019, up to a maximum of 1 October 2020 as stated in the Director General of Taxes Letter number S-990 / PJ / 2020. This relaxation is given in the context of force majeure condition due to the Corona Virus Disease 2019 (Covid-19) pandemic.

Meanwhile, the reporting obligations related to the implementation of the Automatic Exchange of Information (AEoI) previously had to be carried out on a maximum of 31 August each year, as stated in the Minister of Finance Regulation (PMK) number 70 / PMK.03 / 2017 which  has been amended by PMK number 73 / PMK.03 / 2017 and PMK number 19 / PMK.03 / 2018.

With the relaxation, LJKs which submitted the report until 1 October, 2020 will not get a written warning. In submitting report, LJKs must pay attention to the format determined by the DGT by using an electronic mechanism through the Financial Services Authority (OJK).

Previously, the obligation to submit financial information reports for automatic exchange of information was stipulated in Law number 9 of 2017 on Enactment of the Government Regulation in Lieu of Law (Perppu) Number 1 of 2017 on Access to Financial Information for Taxation Purposes. The regulation was later derived in a more technical regulation through PMK number 70 / PMK.03 / 2017 as amended by PMK 73 / PMK.03 / 2017 and PMK number 19 / PMK.03 / 2018.

Based on these provisions, LJKs are required to submit account statements owned by an entity with an aggregate balance or account value as of 31 December each year above USD 250 million. Some of the information that must be submitted includes the identity of the account holder, account number, identity of the reporting financial institution, balance or account value and income related to financial account.

For employers or employees of LJK who do not report financial information and do not carry out financial account identification procedure properly are threatened to a maximum confinement of one year or a maximum fine of IDR 1 billion. Meanwhile, LJKs or entities that violate the provisions of AEoI are subject to a maximum fine of IDR 1 billion.

Sanction also applies to any person who makes false statements or hides or substracts actual financial information hidden, with the threat of a maximum confinement of one year or a maximum fine of IDR 1 billion.