tax clearance indonesia

Tax Clearance Certificate in Indonesia: All You Need to Know

  • InCorp Editorial Team
  • 9 January 2024
  • 4 minute reading time

If you wish that your salary is not withheld by the Directorate General of Taxes in Indonesia or to ensure the smooth process of other business activities, chances are you need to have a Tax Clearance Certificate.

We’ve asked our team of tax specialists at Cekindo to compile the necessary information you need to know about tax clearance certificate in Indonesia. This article explains what tax clearance is, its eligibility and requirements and the application procedure.

What is Tax Clearance?

A tax clearance certificate (Surat Keterangan Fiskal – SKF) in Indonesia is a letter or certificate issued by the Directorate General of Taxes of Indonesia that applies to both individuals and corporations. It is a written confirmation that proves that an individual’s or a company’s tax affairs are in order and don’t owe any outstanding income tax.

Upon having obtained your tax clearance certificate, any of your money withheld will be released to you, provided that you have settled any outstanding taxes. The money released can be profits, salary, compensation, overtime payment, etc.

When do You Need a Tax Clearance Certificate?

According to the Circular No.SE-04-PJ/2019 (or Circular 4/2019) on Implementation Guidelines for the Granting of Tax Clearance Certificate, in order to obtain certain services and to ensure the performance of particular activities by agencies, ministries or other parties, a tax clearance certificate is required.

These activities include, but are not limited to, the following:

  • Utilizing book value for transferring assets in the events relevant to business acquisitions, mergers, or consolidations
  • Imposing 0.5 % income tax for transferring real estate to Collective Investment Contracts (Kontrak Investasi Kolektif) or Special Purpose Companies
  • Reimbursing value-added tax and luxury-goods sales tax to Special Working Units for Upstream-Oil and Gas activities through K3S contracts
  • Deducting corporate income tax in Special Economic Zones
  • Purchasing goods and services
  • Tax holidays
  • Foreign exchange activities (non-bank)
  • Non-fiscal facilities (industry or industrial zone companies)

Eligible Parties for Tax Clearance

Individual taxpayers or the head of company on behalf of corporate taxpayers can obtain tax clearance certificates manually or electronically through the Directorate General of Taxes.

Requirements for Tax Clearance Certificate

All taxpayers must sign and submit a written application. The application may also be submitted by the following third parties:

  • Corporate taxpayers’ employees
  • Attorneys
  • Other parties that are not mentioned (evidenced by appointment letters)

Taxpayers whose applications are submitted to local tax offices that are different from where they are registered must meet the following requirements:

  • Submit a copy of the deed of establishment
  • Submit other supporting documents, i.e. annual income tax returns, etc.
  • Should have submitted the annual income tax returns for the past two years and value-added tax returns for the past three tax periods
  • Should not have any tax debt (debt payment installments and approval for tax payment delay are not allowed as well)
  • Must not currently be investigated for any tax crimes

Application Procedure for Tax Clearance in Indonesia

As of February 4 2019, the Directorate General of Taxes in Indonesia has enforced the new guideline PER-03/PJ/2019 with regards to obtaining a tax clearance certificate SKF in the country. This new regulation has revoked the previous PER-32/PJ/2014.

Taxpayers (individuals or corporate) who request tax clearance certificates or letters must submit their electronic applications through the Directorate General of Taxes’ website; or submit their written applications directly to the tax offices or taxation counseling and consultation offices.

Upon fulfilling the application requirements (as mentioned earlier), a tax clearance certificate will be issued within 3 working days – much shorter as compared to the previous 15 working days.

The validity of a tax clearance certificate is 1 month, starting from the date of issuance. Its validity can be verified through the website of Directorate General of Taxes in Indonesia or tax offices.

Cekindo Can Help

Having a team of tax specialists, Cekindo is happy to answer your questions related to taxes in Indonesia. We also offer tax and accounting outsourcing services that can support your business growth in the country. Get in touch with us today by filling in the form below. Or, visit our offices in Jakarta, Bali and Semarang.

Pandu Biasramadhan

Senior Consulting Manager at InCorp Indonesia

An expert for more than 10 years, Pandu Biasramadhan, has an extensive background in providing top-quality and comprehensive business solutions for enterprises in Indonesia and managing regional partnership channels across Southeast Asia.

Get in touch with us.

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Disclaimer: The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind.

We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials.

We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website.

Frequent Asked Questions

Yes, submitting monthly and annual tax reports is mandatory even if your company does not have any business activities, thus zero taxes.