Tax Clinic
Having Online Loan, Must be Reported in the Annual Tax Return

Saturday, 16 March 2024

Having Online Loan, Must be Reported in the Annual Tax Return

One of the important elements that must be submitted by taxpayers in the Annual Income Tax Return (SPT), in addition to the amount of income and tax that has been paid, is a list of assets and liabilities. Included in the category of liabilities that must be reported are debts incurred or obtained from financial applications aka online loans (pinjol).

The popularity of pinjol continues to increase along with the proliferation of Financial Technology (Fintech) Companies that offer easy and fast financing services. In fact, pinjol also raises a number of problems in society. However, it does not dampen the public demand for the existence of pinjol. 

Apart from the problems it causes, there are tax aspects that need to be understood from the existence of pinjol. One of them is related to the obligation to submit the Annual Income Tax Return for individuals. 

So, pinjol is included in the criteria as a liability that must be reported in the Annual Tax Return, precisely in the liability column, in the amount of the debt balance recorded at the end of December or the end of the Tax Year. 

Form 1770

For taxpayers reporting their Annual Income Tax Return using Form 1770, information on liabilities or debts is contained in Appendix IV.

For information, the 1770 Annual Income Tax Return form is used by individual taxpayers who have income from: 

- Business activities (non-employees) such as opening a salon business, stalls
- Free work such as doctors, notaries, and others.
- Income subject to final income tax
- Other domestic income, such as royalties, interest rental income, or gains on sale and purchase transactions
- Income from overseas  

Form 1770 S

Meanwhile, for taxpayers who use the Annual Income Tax Return form 1770 S, information on obligations or debts is contained in Appendix II. The Annual Income Tax Return form 1770 S is used by employees or Individual Taxpayers who receive income from more than one employer with a gross income value above IDR 60 million a year.

If the submission of the Annual Income Tax Return is done using e-filing facilities, information about obligations or debts is on page 8. The tax debt code used is 101 because loan shark debt is included in the Bank/Non-Bank Financial Institution Debt group.

Here is a list of tax debt codes that you need to know:
- 101: Bank/Non-Bank Financial Institution Debt
- 102: Credit card debt
- 103: Affiliated debts or loans from related parties
- 104: Other debts that are not included in the above debts

Meanwhile, the pinjol debt that must be reported includes the debt owned by the Taxpayers themselves or family members such as wife or child. Except, for the loan payable owned by the wife who has lived separately, made a property and income separation agreement, or exercised her own taxation rights and obligations.

Reporting the debt owned in the Annual Tax Return is crucial for Taxpayers. The reason is, that every addition or subtraction of assets, debts, and receivables is an indicator of changes in the taxpayer's economic capacity. (ASP/KEN)


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