Definition of PKP

According to UU KUP No. 6 of 1983 which has been amended by Law No. 7 of 2021 jo. Article 1 of the Law on Harmonization of Taxation, the definition of a Taxable Entrepreneur is an Entrepreneur who delivers Taxable Goods and/or delivers Taxable Services that are subject to tax based on the 1984 Value Added Tax Law and its amendments.

 

PKP Terms

Based on the Regulation of the Minister of Finance Number 197/PMK.03/2013 concerning VAT Limits for Small Entrepreneurs, Entrepreneurs who are required to become PKP are Entrepreneurs who in 1 (one) financial year have a minimum turnover of IDR 4.8 billion.

 

What are the PKP obligations for husband and wife??

Based on KUP Law No. 7 of 2021 jo. Article 8 paragraph 2 of the Tax Harmonization Law:

• If the NPWP of the husband and wife are combined, the confirmation to become a Taxable Entrepreneur (PKP) is calculated based on the combined turnover of the husband and wife's independent business/employment income,
• If the husband and wife have their own NPWP, the confirmation to become a Taxable Entrepreneur (PKP) is calculated based on the respective turnover of the husband's or wife's free business/employment income.