Income tax procedures simplified<\/p>\n
JAKARTA (JP): The directorate general of taxes has expedited
\nthe procedures for foreigners to obtain lower income tax rates by
\nreducing the documents they have to submit to the tax office.<\/p>\n
"Beginning early this month, foreigners applying for lower
\nincome tax rates are required to submit only their original
\ncertificate of residence to their employers and a copy of the
\ncertificate to the local tax office," Director General of
\nTaxation Fuad Bawazier said in a circular received yesterday.<\/p>\n
He said that foreigners who earn an income in Indonesia are
\nsubject to a final income tax rate of 20 percent. However,
\nforeigners whose home countries have double taxation agreements
\nwith Indonesia may obtain a lower income tax rate or even tax
\nexemption contingent upon the provisions of the double taxation
\naccords.<\/p>\n
Previously, foreigners applying for income tax exemption or
\nlower income tax rates were required to submit many documents,
\nincluding a certificate of tax free facility, a certificate of
\ntax rates and certificate of residence.<\/p>\n
There are 31 countries that have signed double taxation
\nagreements with Indonesia but the agreements stipulate different
\nincome tax rates.<\/p>\n
Fuad pointed out that a certificate of residence has to be
\nsigned by a respectable party in the home country of a foreigner
\nor an authorized representative.<\/p>\n
The director general's directive stipulates that a certificate
\nof residence would be the basis for a employer to determine a
\nforeigner's tax on income derived in Indonesia.<\/p>\n
Fuad pointed out that foreign banks or financial institutions
\nclearly mentioned in the double taxation agreements are not
\nrequired to submit certificates of residence. But other banks and
\nforeign institutions have to submit such a certificate. (13)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/income-tax-procedures-simplified-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}