The Ministry of Finance (MoF) on October 18, 2024 introduced Regulation No. 81 (MoF-81) to streamline and develop different tax regulations. This was done in order to ensure that the new CoreTax Administration System (CoreTax) would be effective from 1 January 2025. This is a major reform effort that seeks to improve the effectiveness, reliability and accountability of the tax system through digital change management.
This article will explain in detail what CoreTax is, and how it affects businesses and taxpayers in Indonesia. While it focuses on the main regulatory changes, it does so for all the provisions of the regulation.
Highlights:
- Key Objectives of CoreTax System
- Implementation of Electronic Tax Administration
- Major Changes Introduced by PMK-81 / CoreTax
- Components of CoreTax
- Why Businesses Must Prepare for CoreTax in Indonesia
- CoreTax Activation Process
- How Businesses Can Streamline CoreTax Adoption
- Seamless CoreTax Compliance with Lets Move Indonesia
MoF-81 subsumes 42 other tax regulations which were consolidated to make the tax procedures simpler and more digital oriented. CoreTax is a significant change in the tax system of Indonesia, which is based on the integration of COTS information systems with a new design of the tax database in order to increase the effectiveness, precision, and observance.
Key Objectives of CoreTax System
The CoreTax Administration System aims to:
- Automate transactions to limit contact and avoid the need for human intervention and mistakes.
- Real time data management for equitable taxation and to foster taxpayers’ confidence with the government.
- Simplify tax processes, with automated follow up and digital submission of returns to reduce delays in compliance.
- Enhance data quality to support decision making and regulation enforcement by tax agencies.
Implementation of Electronic Tax Administration
MoF-81 establishes electronic channels as the primary means for taxpayers to fulfil their tax obligations. Non-electronic alternatives are permitted only in exceptional circumstances, such as inadequate infrastructure, technical failures, or natural disasters. The digital tax administration will be facilitated through:
- The taxpayer portal
- Websites and applications integrated with the Directorate General of Taxes (DGT) system
- The DGT contact centre
Major Changes Introduced by PMK-81 / CoreTax
| Change | Description |
| Revocation of Outdated Regulations | MoF-81 eliminates 42 outdated tax regulations, consolidating them into a more cohesive tax framework. |
| Mandatory Electronic Tax Administration | Tax compliance processes, including filing and payment, must be conducted through electronic platforms, except under specific conditions. |
| Revised Taxpayer Registration Terms | The term “Non-Effective Taxpayer” is replaced with “Inactive Taxpayer,” and registration procedures are updated to align with CoreTax. |
| Centralisation of Taxpayer Obligations | Businesses operating in multiple locations will have their tax rights and responsibilities managed centrally based on their registered Taxpayer Identification Number (NPWP). |
| Monthly VAT Reporting for E-Commerce | E-commerce VAT collectors must submit monthly VAT reports instead of quarterly submissions. |
| Electronic Submission of Financial Statements | Annual tax returns submitted electronically must include financial statements in a predefined digital format. |
| Extended Filing Deadline for Carbon Tax | Taxpayers may request an extension of up to two months for Carbon Tax Return submissions via electronic notification. |
| Unified Tax Terminology | Standardised terminology is introduced, including a “Unification Tax Return” for various withholding tax reports. |
| Simplified Tax Clearance Letter (SKF) Application | Certain documentation requirements for obtaining a Tax Clearance Letter have been removed, streamlining the process. |
You may also read:
Indonesia Implements Coretax System in January 2025: What You Need to Know
Indonesia Joins BRICS in 2025: Benefits and Direct Impacts in Doing Business in Indonesia
Components of CoreTax
PMK-81 outlines several critical components within the CoreTax system, covering all aspects of tax administration:
| Component | Description |
| Taxpayer Rights and Obligations | Defines the rights and responsibilities of taxpayers in meeting their tax obligations. |
| Taxpayer Registration | Specifies procedures for registering individuals and entities, including VAT registration. |
| Payment and Refund Mechanisms | Establishes guidelines for tax payments, deposits, refunds, and interest compensation for overpayments. |
| Tax Returns and Reporting | Details submission and processing procedures for various tax returns, including Income Tax and VAT. |
| Administrative Services | Sets out the framework for electronic tax administration services, including digital communication channels. |
Why Businesses Must Prepare for CoreTax in Indonesia
Indonesia’s tax landscape is evolving, and businesses need to keep up. With the introduction of the CoreTax Administration System, tax reporting and compliance are going digital, making it essential for companies to adapt. Failing to do so could result in penalties or compliance issues. Here’s what businesses need to do:
- Integrate with Electronic Tax Procedures. Ensure your accounting and reporting systems are in sync with the Directorate General of Taxes (DGT) platform to simplify tax filings.
- Train Your Team. Employees handling tax matters should be well-versed in the new filing and reporting requirements.
- Review Your Tax Strategy. Take a fresh look at your internal tax policies to ensure they align with CoreTax regulations and avoid any compliance risks.
CoreTax Activation Process
Businesses and taxpayers must activate CoreTax by completing the following steps:
- Log in to the Taxpayer Portal or visit the nearest tax office.
- Validate your registered email and mobile phone details.
- Submit the activation request online or in person.
- Approve your taxpayer account as the official channel for electronic communication.
- Start using CoreTax to access real-time updates, upload documents, and track submissions effortlessly.
Adapting to CoreTax: Key Considerations for Businesses
Tax Document Submission and Receipt Dates
Understanding when tax documents need to be submitted and received is crucial to compliance:
For Taxpayers: If you submit the same document both electronically and in hard copy (when electronic submission is unavailable), the DGT system will register the first recorded submission as the official receipt date.
For the DGT: Tax decisions and other official documents are sent via your registered taxpayer account or email. If physical copies are required, they will still be sent manually. The official receipt date is the earliest timestamp recorded across all communication channels, including email and direct delivery.
Time Standard: The DGT follows West Indonesia Time (WIB) as the standard for document timestamps.
Standardised Tax Payment Deadlines
The Ministry of Finance Regulation No. 81 (MoF-81) standardises tax payment deadlines, unifying most tax obligations to the 15th of the following month. Affected taxes include:
- Income Tax Articles 4(2), 15, 21, 22, 23, 25, and 26
- Oil & Gas Income Tax
- Value Added Tax (VAT) on cross-border intangible goods and services
- VAT on self-construction projects
- Stamp Duty and Carbon Tax collection obligations
Exceptions to Tax Payment Deadlines
Certain tax obligations retain special deadlines:
Import-related taxes (Income Tax Article 22 & VAT):
- When paid by the taxpayer/importer, these taxes must be settled along with import duties.
- If duties are deferred or exempted, these taxes must be paid upon completion of import customs documents.
Income Tax Article 25:
- Taxpayers consolidating multiple tax periods in a single return must make payments by the 15th of the month following the last tax period covered.
Additional Income Tax on Founder Shares:
- Must be deposited within one month of the due date.
VAT & Sales Tax on Luxury Goods (STLG):
- Must be settled by the end of the month following the relevant tax period and before VAT return submission.
VAT collected by third parties:
- Must be deposited by the month’s end following the tax period.
Restrictions on Tax Overbooking
The DGT imposes limitations on overbooking (offsetting) excess tax payments in cases such as:
- Non-creditable VAT invoices (as per Article 9(8) of the VAT Law).
- Electronic stamp duties distributed via Perum Peruri or PT Pos Indonesia.
- Tax payments with billing codes from non-DGT systems.
- Tax payments linked to tax enforcement actions, including:
- Tax Collection Letters (Surat Tagihan Pajak)
- Tax Assessment Notices (SKPs)
- Objection and Appeal Decisions
Transitional Provisions for Electronic Certificates & Applications
- Existing electronic certificates, filing identification numbers, and verification codes remain valid for tax periods up to 2024.
- The DGT will continue using uncertified electronic signatures for issuing tax decisions until the end of 2024.
- Applications submitted before January 1, 2025, will generally be processed under pre-MoF-81 rules unless they involve interest compensation requests not yet finalised by that date.
How Businesses Can Streamline CoreTax Adoption
Familiarise with CoreTax Functionalities
Understanding CoreTax’s features, such as centralised tax filing and real-time document processing, will ensure a smoother transition.
Upgrade Digital Tax Infrastructure
Companies should verify that their financial software is compatible with CoreTax and enhance cybersecurity measures to protect sensitive tax data.
Conduct Internal Compliance Audits
Reviewing tax records and prior filings can help businesses identify and rectify discrepancies before integrating with CoreTax.
Employee Training & Capacity Building
Finance and tax teams should undergo comprehensive training to navigate the new system efficiently and maintain regulatory compliance.
Optimise Tax Workflows
Automating routine tax processes, such as document submission and reporting, can help businesses streamline compliance and reduce administrative burdens.
Seek Professional Tax Consultation
Given the complexities of CoreTax, working with Indonesian tax experts, such as Lets Move Indonesia, can ensure businesses navigate the transition seamlessly while mitigating compliance risks.
Seamless CoreTax Compliance with Lets Move Indonesia
The implementation of PMK-81 and CoreTax introduces substantial changes in Indonesia’s tax landscape. Lets Move Indonesia offers expert tax consultation and reporting services designed to assist businesses in adapting to the new regulations.
Our services include:
- Tax Consultation: Tailored guidance on PMK-81 and CoreTax compliance strategies.
- Tax Reporting Assistance: End-to-end support for VAT filings, annual tax submissions, and refund applications.
- Regulatory Updates & Advisory: Regular insights on evolving tax policies to ensure businesses stay ahead of compliance requirements.
Ensure your business remains compliant and optimised for Indonesia’s tax transition. Contact Lets Move Indonesia today.
