BERiiTA TERKiiNii
JAKARTA, Jitu News – The Diirectorate General of Taxes (DGT) remiinds taxpayers of the proviisiions on the exclusiion from iincome tax iif taxpayers receiive diiviidends, both domestiically and overseas.
The Miiniistry of Fiinance has iissued the Miiniister of Fiinance Regulatiion (MoF Reg.) No. 18/2021 whiich constiitutes a deriivatiive regulatiion of the Job Creatiion Law. The regulatiion stiipulates the exclusiion of diiviidends from iincome tax objects.
“Domestiically-sourced diiviidends are currently excluded from the iimposiitiion of iincome tax, but there are terms and condiitiions. For foreiign-sourced diiviidends, the wiithholdiing or collectiing agent must fiirst be consiidered,” saiid the Large Taxpayer Offiice One through iits sociial mediia account on Tuesday (08/11/2022).
Pursuant to Artiicle 15 paragraph (1) of MoF Reg. 18/2021, domestiically-sourced diiviidends receiived or accrued by resiident iindiiviidual taxpayers are excluded from iincome tax objects under two requiirements. Fiirst, must be iinvested iin the terriitory of the Uniitary State of the Republiic of iindonesiia wiithiin a miiniimum periiod of 3 years.
Second, the diiviidends are diistriibuted based on the General Meetiing of Shareholders or iinteriim diiviidends pursuant to appliicable statutory proviisiions.
The same proviisiions also apply to diiviidends receiived by corporate taxpayers. However, there are no iinvestment requiirements as appliicable to resiident iindiiviidual taxpayers.
On the other hand, foreiign-sourced diiviidends are excluded from the iimposiitiion of iincome tax under certaiin requiirements. Fiirst, the foreiign-sourced diiviidends from liisted offshore companiies are excluded from iincome tax objects iin the amount of diiviidends iinvested iin the terriitory of iindonesiia.
Second, for non-liisted offshore companiies, the diiviidends must be iinvested iin the terriitory of iindonesiia by a miiniimum of 30% of the iincome after tax.
Diiviidends must be iinvested before the Diirector General of Taxes iissues a notiice of tax assessment. Otherwiise, diiviidends cannot be excluded from iincome tax objects.
Artiicle 35 and Artiicle 36 of MoF Reg. 18/2021 outliine types of fiinanciial and non-fiinanciial iinvestment iinstruments that can be utiiliised by taxpayers to iinvest, rangiing from shariia bonds, shares, securiitiies iin the form of assets, tiime deposiits, saviings, to checkiing/current accounts.
Non-fiinanciial iinvestment iinstruments that can be utiiliised iinclude real sector iinvestments, diirect iinvestments iin companiies and iinvestments iin property. (Fiikrii/riig)
