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Indonesia: New regulation on calculation of gross turnover


On February 13 2018, the Minister of Finance (MoF) issued new Regulation No 15/PMK03/2018 concerning Alternative Methods for Calculating Gross Turnover (MoF Regulation No 15/2018). As the title suggests, the regulation provides several other methods for calculating the gross turnover of an Indonesian taxpayer, and further implements provisions under the Indonesian Income Tax Law.

Under the Indonesian Income Tax Law, generally a taxpayer is required to manage and organise accounting books to ensure that the taxes imposed are fair and reasonable and in accordance with the economic abilities of the taxpayer. However, it is not always possible for taxpayers, especially individuals, to achieve this. Thus the Indonesian Income Tax Law provides assistance to individual taxpayers whose business or freelance work has an annual gross turnover of less than IDR4.8 billion ($336,000) through the so-called 'net income calculation norm' which provides guidance on the calculation of net income. The norm is issued from time to time by the Directorate General of Tax (DGT).

In order for a taxpayer to be able to use the norm as a basis for calculation, he/she must notify the DGT accordingly within the first three months of the relevant accounting year and keeping of records (pencatatan). If the taxpayer fails to do this, he/she will be deemed to have opted for the book-keeping method (pembukukuan). If a taxpayer who is required to conduct either book-keeping or maintenance of records fails to do so or fails to provide relevant evidence thereof, the gross turnover of the relevant taxpayer has to be calculated by other methods.

The following methods of calculation have been introduced under the MoF Regulation No 15/2018:

  1. cash and non-cash transactions;

  2. source and utilisation of funds;

  3. units and/or volume;

  4. calculation of living costs (of the taxpayer and his/her dependents including expenses used to increase assets);

  5. increase in net assets;

  6. calculation based on notification letter or results of inspection of the preceding accounting year's tax return or audit;

  7. projection of economic value; and/or

  8. calculation of ratio (based on percentage or comparative ratio).

The above methods will be used based on data and/or information from one accounting year pertaining to the relevant method.

The MoF Regulation No 15/2018 does not provide a mechanism for or further elucidation on the implementation of these methods. It states only that further provisions on the procedures will be announced under a DGT regulation.


Freddy Karyadi ( and Nina Cornelia Santoso (, Jakarta

Ali Budiardjo, Nugroho, Reksodiputro, Law Offices

Tel: +62 21 250 5125


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