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Director General of Taxes Regulation Number 16 of 2025

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2 Sep 2025, 05.36 WIB

Tax Brief: Director General of Taxes Regulation Number 16 of 2025

 

Less than three months after it took effect, the Director General of Taxes has revised Regulation Number PER-6/PJ/2025 on preliminary refunds of tax overpayments. The amendment is introduced through the Director General of Taxes Regulation Number PER-16/PJ/2025, which incorporates several adjustments to the earlier provisions.

 

According to its recital, the change was made to provide greater legal certainty in the implementation of preliminary tax refunds. Specifically, the government recognized the need to refine the rules applicable to taxpayers with special criteria, including those with specific requirements, low-risk taxable entrepreneurs, as well as special purpose companies or collective investment contracts classified as low-risk taxable entrepreneurs.

 

There are three main changes in PER-16/PJ/2025. First, Article 6 has been amended by inserting a new Paragraph 2(a) between Paragraphs 2 and 3.

 

Input VAT that may be credited and included as part of a tax overpayment consists of the following:

  1. tax invoices as referred to in Article 6, Paragraph 8, Letter a(1), Article 10, Paragraph 5, Letter a(1), and Article 16, Paragraph 5, Letter c(1), of PMK-39/PMK.03/2018, provided they have been reported in the taxpayer’s monthly VAT return;
  2. documents treated as equivalent to tax invoices as referred to in Article 6, Paragraph 8, Letter a(2), Article 10, Paragraph 5, Letter a(2), and Article 16, Paragraph 5, Letter c(2), of PMK-39/PMK.03/2018, provided they have been reported in the taxpayer’s monthly VAT return;
  3. import customs declarations treated as equivalent to tax invoices, in accordance with the Minister of Finance regulation (Peraturan Menteri Keuangan/PMK) on import taxation, provided they have been electronically exchanged with the Directorate General of Taxes;
  4. import customs declarations treated as equivalent to tax invoices, as regulated under the PMK on import taxation, uploaded by the taxpayer with the treasury receipt number included; and/or 
  5. documents confirming the payment of import duties, excise, and/or taxes in accordance with the PMK on the taxation of imported goods, provided that:
  6. they include a treasury receipt number;
  7. they are recorded in the Directorate General of Customs and Excise information system;
  8. they have been electronically exchanged with the Directorate General of Taxes; and
  9. payment has been made by the taxpayer through a postal service provider for imported goods deliveries.

 

Second, Article 7 has been updated with a new Paragraph 4(a), inserted between Paragraphs 4 and 5. Input VAT that may be credited and included in a tax overpayment is VAT recorded in:

  1. tax invoices as referred to in Paragraph 4, Letter a(1), which have been reported in the monthly VAT return of the taxable entrepreneur who issued the tax invoice;
  2. documents treated as equivalent to tax invoices as referred to in Paragraph 4, Letter a(2), which have been reported in the monthly VAT return of the taxable entrepreneur who issued such documents;
  3. import customs declarations treated as equivalent to tax invoices, as referred to in Paragraph 4, Letter a(2), are in the form of import customs notification documents in accordance with PMK on import taxation, provided they have been electronically exchanged with the Directorate General of Taxes;
  4. import customs declarations treated as equivalent to tax invoices as referred to in Paragraph 4, Letter a(2), in accordance with PMK on import taxation, uploaded by the applicant taxpayer with the treasury receipt number included; and/or
  5. documents treated as equivalent to tax invoices as referred to in Paragraph 4, Letter a(2), determining the payment of import duties, excise, and/or taxes in accordance with the PMK on import taxation, provided that:
    1. they include a treasury receipt number;
    2. they are recorded in the Directorate General of Customs and Excise information system;
    3. they have been electronically exchanged with the Directorate General of Taxes; and
    4. payment has been made by the taxpayer through a postal service provider for imported goods deliveries.

 

Third, Paragraphs 4 and 5 have been added to Article 11 of PER-16/PJ/2025.

 

Paragraph 4 addresses applications for preliminary refunds of overpaid tax based on the 2024 fiscal year return. They clarify that certain individual taxpayers who mistakenly report Article 21 income tax credits, which results in a false overpayment, will not be considered to have an overpayment. In such cases:

  1. the application will not be processed further; 
  2. no Preliminary Tax Overpayment Refund Decision Letter will be issued; and
  3. the case will not proceed under Article 17(B) of the Republic of Indonesia concerning General Provisions and Procedures of Taxation.

 

Paragraph 5 further defines the individual taxpayers covered by this rule. They include non-civil servants, non-military/police personnel, non-state officials, and non-retirees who meet all of the following conditions:

  1. only receive income and withholding tax slip of Article 21/26 form 1721-A1 - withholding tax slip of Article 21 for permanent employees or retirees who receive pension-related money periodically solely from 1 (one) employer, pension fund, or other body that pays pensions and other payments under any name in connection with pensions;
  2. does not have a reduction in gross income in the form of zakat or obligatory religious donations that are paid not through the employer or pension payer; and

  3. the tax overpayment arises when the taxpayer’s calculation of income tax payable is lower than the Article 21 income tax withheld, as stated in the Article 21/26 form 1721-A1 withholding tax slip, applicable to permanent employees or retirees receiving regular pension payments.

     

Conclusion

 

In summary, PER-16/PJ/2025 introduces several vital clarifications:

  • It specifies the types of input VAT and supporting documents that can be credited when calculating a tax overpayment.
  • It affirms that specific refund applications from individual taxpayers based on reporting errors do not constitute a genuine overpayment and will therefore not result in a refund decision letter being issued.
  • It reiterates the conditions under which preliminary tax refund applications from individual taxpayers will not be processed.
  • PER-16/PJ/2025 is effective since August 13, 2025.

 

Legal References

 

  • Law of the Republic of Indonesia Number 8 of 1983 concerning Value-Added Tax and Luxury-Goods Sales Tax, as amended by Law of the Republic of Indonesia Number 7 of 2021 concerning Harmonization of Tax Regulations.
  • Minister of Finance Regulation Number 39/PMK.03/2018 concerning Procedures for Preliminary Refunds of Tax Overpayments, as amended by Minister of Finance Regulation Number 119 of 2024 concerning the Third Amendment to Minister of Finance Regulation Number 39/PMK.03/2018 concerning Procedures for Preliminary Refunds of Tax Overpayments.
  • Director General of Taxes Regulation Number PER-6/PJ/2025 concerning the Implementation of Preliminary Refunds of Tax Overpayments to Taxpayers with Specific Criteria, Taxpayers with Specific Requirements, and Low-Risk Taxable Entrepreneurs, as well as Special Purpose Companies or Collective Investment Contracts as Low-Risk Taxable Entrepreneurs, as amended by PER-16/PJ/2025.
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