Four Categories of Taxpayers Exempted from Filing Annual Tax Returns

Indonesian citizens are generally required to file tax returns annually. However, several groups of taxpayers are exempt from filing their annual income tax returns (Surat Pemberitahuan, or SPT).

The exemption criteria follow Finance Ministry Regulation No. 81 of 2024 concerning Tax Provisions in the Implementation of the Core Tax Administration System. According to Article 465 letter s of PMK 81/2024, “Criteria for certain income taxpayers excluded from the obligation to file tax returns as referred to in Article 180 paragraph (2) shall be established by the Director General of Taxes.”

This provision previously appeared in PMK-147/PMK.03/2017 and the Director General of Taxes Regulation No. PER-04/PJ/2020. Taxpayers classified as Non-Effective (NE) are not required to file annual tax returns and will not receive warning letters for non-compliance.

The four categories of NE taxpayers are:

• Taxpayers whose income has fallen below the Non-Taxable Income threshold (PTKP)

• Entrepreneurs who have ceased business operations

• Workers who are no longer employed and have no income

• Pensioners who no longer receive income

Under the current Coretax system, the NE designation has been replaced with “Inactive Taxpayer” status. Inactive taxpayers are exempt from filing SPT from the tax year they are designated as inactive.

Criteria for Individual Taxpayers:

• Have ceased business or self-employment activities and no longer meet objective requirements

• Have no income or income below the non-taxable threshold

• Indonesian nationals who intend to become foreign tax subjects but do not yet meet foreign subject requirements (SPLN)

• Married women who choose to combine their tax obligations with their husbands

• Indonesian nationals whose resident status no longer meets subjective and objective requirements because they have become SPLN

• Other criteria established by the Director General of Taxes

Criteria for Corporate Taxpayers:

• Do not meet subjective and objective requirements but whose tax identification number (NPWP) has not been cancelled

• Meet specific criteria established by the Director General of Taxes

Criteria for Government Institutions:

• Do not meet requirements as tax collectors or assessors but whose NPWP has not been cancelled

• Meet specific criteria established by the Director General of Taxes

Application Process:

Taxpayers seeking inactive status should follow these steps:

• Log into the tax account on the Coretax DJP portal

• Access “My Portal” > “Status Changes” > “Designation of Inactive Taxpayer”

• Complete the application form and upload supporting documents (for example, married women combining with a spouse’s NPWP should upload the spouse’s identity card, wife’s identity card, and family card)

• Read and tick the declaration statement

• Click “Submit” to send the application

After submission, applicants can monitor the status through “My Portal” > “My Cases”. The system should show: “Case is in process. No action can be taken at this time.”

Processing typically takes a maximum of five working days from the date a complete application is received.