Non – taxable income

In calculating the taxable income of an individual resident taxpayer to him, a deduction shall be given in
the form of non-taxable income based on the provisions as referred to in Article Seven of the law on
income taxable non-taxable income per year shall be given a minimum of:

Information Effective 2015 effective 2016

for an individual taxpayer IDR 36.000.000 IDR 54.000.000
additional for a married IDR 3.000.000 IDR 4.500.000
taxpayer
additional for a wife whose IDR 36.000.000 IDR 54.000.000
income is combined with the
husband's income
additional for each member of 3.000.000 IDR 4.500.000
your relative and cement family
in the straight line and adopted
children who are fully
dependent of a maximum of
three people for every family

To calculate the amount of taxable income from an individual resident taxpayer, the net income
is reduced by the amount of non-taxable income. In addition to himself, married taxpayers are given
additional non-taxable income.

For taxpayers whose wives receive or receive income that is combined with their income, the
taxpayers will receive additional non-taxable income for a wife of at least IDR 54,000,000

Taxpayers who have blood family members and Semenda in a straight line who are fully
dependent. family members who are fully dependent are family members who have no income and all
living expenses are borne by the taxpayer

example :

Taxpayer A has a wife with four children as dependents If the wife earns income from an employer
whose income tax article 21 has been deducted and the job has nothing to do with the husband's
business or other family members, the amount of non-taxable income given to the taxpayer A is in the
amount of idr 72,000,000 {idr 54,000,000 + idr 4,500,000 + (3x idr 4,500,000)}, while for his wife, at the
time of withholding income tax article 21 by the employer is given non-taxable income of idr 54,000.
000. if the wife's income must be combined with the husband's income, the amount of non-taxable
income given to taxpayer A is IDR 126,000,000 (idr 72,000,000 + idr 54,000,000).

All income or loss for a married woman at the beginning of the tax year or at the beginning of the
tax year, once the loss arising from the previous years has not been compensated for, is considered as
her husband's income or loss, unless the income is solely received or earned. from an employer whose
tax has been withheld under the provisions of Article 21 of the income tax law and has nothing to do
with the business or independent work of the husband or other family members. The income of a
husband and wife is taxed separately if:

1. Husband and wife live separately based on the judge's decision

2. Required in writing by husband and wife based on an agreement to separate assets and income;
or

3. Willed by the wife who chooses to exercise her own tax rights and obligations

Income or loss for a woman who is married at the beginning of the tax year or at the beginning of the
tax year is considered the income or loss of her husband and is taxed as a unit. The merger is deemed
not to be carried out if the wife's income is obtained from work as an employee who has been tax
deducted by the taxpayer, provided that:

1. The wife's income is solely obtained from one employer, and

2. The wife's income comes from work that has nothing to do with the business or independent
work of her husband or other members.

Costs that are not deductible

Expenses incurred by taxpayers can be differentiated between expenses that are allowed and cannot be
charged as expenses. Expenditures that may not be deducted from income from gross income include
expenditures which are the use of income or whose amount exceeds the reasonable rate. To determine
the amount of taxable income for domestic taxpayers and permanent establishment, it is not allowed to
be deducted, pay attention to the following matters.

1. Distribution of profit in whatever name and form, such as dividends

2. Costs charged or incurred for the personal benefit of shareholders, partners, or members

3. Establishment or accumulation of reserve funds, except:

a. Reserves for uncollectible accounts for bank businesses and other business entities that
extend credit, leasing with option rights, consumer finance companies and factoring
companies;

b. Reserves for insurance businesses, including social assistance reserves established by the
social security administering agency;

c. Guarantee reserves for savings guarantee institutions;

d. Reclamation reserve for mining business;

e. Reserve for replanting costs for forestry businesses; and

f. Reserve for closing and maintaining industrial waste disposal sites in accordance with the
regulations of the minister of finance

4. Daily insurance premiums, accident insurance, life insurance, endowment insurance, and
scholarship insurance paid by personal taxpayers.
 5. Replacement or remuneration in connection with work or services rendered in kind and in kind.

6. An amount that exceeds the fairness paid to shareholders or to related parties as compensation
in connection with the work performed.

7. Donated assets, assistance or donations, and inheritance as implemented in Article 4 paragraph

3 letters a and b of the Income Tax Law.

8. Income tax.

9. Costs that are charged or incurred for the personal benefit of taxpayers or their dependents.

10. Salary paid to members of an association, firm, or limited partnership whose capital does not
consist of shares

11. Administrative sanctions in the form of interest, fines and increases as well as criminal sanctions
in the form of fines relating to the implementation of laws in the field of taxation.

Asset Valuation
Asset Valuation in Terms of Sale and Purchase

The cost or sale price in the event of a sale and purchase of assets that are not affected by a special
relationship is the amount actually issued or received, whereas if there is a special relationship it is the
amount that should have been issued or received.

Asset Valuation in the Case of Non-monetary Asset Exchange

The cost or sale value in the event of an exchange of assets is the amount that should be issued or
received based on market price.

Asset Valuation in the Context of Liquidation, Merger, Consolidation, Expansion, Splitting, or Business
Acquisition

Acquisition value or assets transferred in the context of liquidation, merger, consolidation, expansion,
splitting, or business takeover is the amount that should have been issued or received based on market
prices.

Transfer of Assets in terms of Grants, Assistance and Donations

1. If an asset is delivered due to a grant, assistance, or contribution that meets the requirements in
Article 4 aya 3 letter a of the Income Tax or inheritance law, the acquisition value for the party
receiving the asset is equal to the book value of the asset from the party making the delivery.

2. If an asset is delivered due to a grant, assistance, or contribution that does not meet the
requirements as referred to in Article 4 paragraph 3 letter a of the Income Tax Law, the
acquisition value for the party receiving the asset is the market price.
Transfer of Assets as a Replacement for Shares

If there is a transfer of assets by an entity, the basis for valuation of the assets for the entity that
receives the transfer is equal to the market value of the assets. Taxpayers' participation in the capital of
an entity can be fulfilled by cash deposits or transfer of assets.

Inventory Valuation

In general, there are three categories of inventory, namely finished goods or merchandise, goods in the
production process, raw materials, and supporting materials. The valuation of the inventory of goods
may only use cost. The evaluation of the use of inventory for the calculation of cost of goods may only
be carried out in the following manner;

1. Average method

2. First-in-first-out method (MPKP)