The Government Provides Certain Taxpayers' Concessions from Bookkeeping Obligation

The government has just issued a new regulation regarding the exemption of bookkeeping for individual taxpayers (WP OP). The policy is contained in Regulation of the Minister of Finance (PMK) Number 54/PMK.03/2021 on Procedures for Recording and Certain Criteria and Procedures for Conducting Bookkeeping for Taxation Purposes. 

Through this regulation, the government provides legal certainty for individual taxpayers, including those who meet certain criteria, to be excluded from the obligation to do bookkeeping. However, even though they are exempted, the taxpayer concerned is still required to do the recording. In Article 2 paragraph (2) of PMK 54/2021, it is stated that the criteria for taxpayers who get concessions from bookkeeping obligations include:

1. Individual taxpayer conducts business activities or independent work and is allowed to calculate net income using the Net Income Tax Norm (NPPN);
2. individual taxpayer who does not carry out business activities or independent work;  and
3. individual taxpayer who meets certain criteria

Related to individual taxpayers with certain criteria, based on Article 5 paragraph (1) PMK 54/2021, the taxpayer concerned carries out business activities or independent work. Then, the taxpayer also has a gross income from his business activities which the overall tax is subject to final income tax and/or is not a tax object and does not exceed IDR 4.8 billion in one fiscal year. For taxpayers with certain criteria, can do recording without submitting a notification on the use of NPPN.

Regarding the recording, in accordance with Article 7 paragraph (1) PMK 54/2021, for individual taxpayers who conduct business activities or independent work, the recording must include: 

• gross income derived from business activities or independent work subject to non-final income tax.  
• gross income derived from outside business activities or independent work that is subject to non-final income tax, as well as costs incurred to obtain, collect, and maintain that income
• gross income that is not a tax object or subject to final income tax, either derived from business activities or independent work or from outside business activities or independent work. 

While for individual taxpayers who do not do business activities or independent work, the recording carried out includes: 

• gross income that is subject to non-final income tax and costs incurred to obtain, collect and maintain that income
• gross income that is not a tax object or is subject to final income tax.

Lastly, the recording of the individual taxpayer with certain criteria, must include:

• gross income derived from outside business activities or independent work which is subject to non-final income tax, as well as costs incurred to obtain, collect, and maintain that income;
• gross income that is not an object of tax or subject to final income tax, either derived from business activities or independent work or from outside business activities or independent work.

Then, for individual taxpayers with business activities or certain criteria who have more than one type of business or independent work and place of business, the recording made must also be able to clearly describe each type or place of business and/or independent work mentioned. In addition, every individual taxpayer mentioned must record assets and obligations according to the provisions of the laws and regulations in the field of taxation. (Ken)