Everything You Need to Know About NPWP: The Key to Tax Compliance in Indonesia

Top layer: An essential component of the Indonesian tax system is the NPWP Indonesia. It’s crucial to comprehend this 15-digit NPWP number whether you’re looking for work, intending to start a PT PMA, or are just inquiring about buying real estate in well-known locations like Bali. In only a few easy steps, one can apply for an Indonesian NPWP number..

What is NPWP Indonesia?

NPWP (Nomor Pendaftaran Wajib Pajak) is the Tax Identification Number in Indonesia used by companies and individuals who are tax residents of Indonesia. NPWP Indonesia, which consists of 15 digits, ensures that everyone, including foreigners living in Indonesia, pays their tax dues according to the country’s taxation regulations.

Expats, in particular, are required to have their Indonesian NPWP number and are obliged to pay monthly income taxes, file annual taxes, and pay taxes on income earned outside Indonesia. Foreigners who establish a PT PMA also receive an NPWP number in Indonesia to pay their corporate taxes, even if they’re not tax residents in Indonesia..

Do I need an NPWP number?

An NPWP tax number is required for everybody living in Indonesia, including foreign nationals. The following people must apply for an NPWP tax number and submit income tax returns:.

  • those with jobs who make more money than the federal non-taxable income limit.
  • those who earn money in addition to their main source of income.
  • individuals filing taxes who make money from their businesses or self-employment.
  • people who profit from capital.
  • foreigners who intend to live in Indonesia or who have been there for more than 183 days in a calendar year

Requirements to apply for NPWP Indonesia:

To register for an NPWP Indonesia, you’ll need to provide several documents. These are the required documents to start the NPWP application:

  • A fully completed registration form.
  • Copies of all passport pages.
  • A work permit photocopy.
  • Domicile certificates for both the individual and their employer.
  • A photograph of the employer’s NPWP.
  • An authorization letter allowing your representative to handle tax-related matters on your behalf.

The Indonesian tax office might request additional documents listed above.

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