BUT tax

discussion
BY : Yulinda Rahma Sari
1810111429 / 4ECAM
 tax subject
Pasal 2 ayat 1 dan 1a

04
Subject of Personal Income Tax

01
Domestic personal income tax subject is a
citizen / foreigner who works and earns
income and is domiciled (permanent
residence) in Indonesia for more than 183
The subject of permanent
business entity income
tax
days within a period of 12 months, or who in Permanent Business Entity
one tax year is in Indonesia and has the (BUT) is an asset in the form of
intention to live in Indonesia . land, buildings, machinery,
  equipment, warehouses and
. computers or electronic agents
or automated equipment that
are owned, leased, or used by
electronic transaction providers
to carry out business activities
via the internet.
Inheritance Income Tax
Subject
Undivided inheritance is 02
03
categorized as income tax subject pph agency tax subject
if it has the potential to become  
income. One example is The object of Corporate Income is
inheritance in the form of property income received or obtained by the
(can be houses, shop houses, agency. For domestic subject
offices, warehouses, etc.) for rent. subjects, the object of income tax is
  all income from within and outside
the country
 foreign tax sources Pasal 2 ayat 4

Foreign tax subjects include individuals who do not reside

in Indonesia, individuals who are in Indonesia but not
more than 183 days within a period of 12 months and That person can be abroad or run his business
permanent business entities that are not established and in Indonesia by commuting
are not domiciled in Indonesia but do business or conduct
activities business in Indonesia.

Agency which is not established and is not domiciled

in Indonesia.

Running a business or activity through BUT in

Indonesia.

Receive or obtainincome from Indonesia not from

running a business or activitythrough BUT in Indonesia.
 Permanent business form
Permanent business form (BUT) is a form of business that is used as a

BUT
non-resident taxpayer subject, either a natural person or a legal person
to run a business or conduct activities in Indonesia
Permanent Establishments as Tax Subjects Pasal 2 ayat 5
In Article 2 Paragraph (5) of Law 36/2008, the government states that permanent
establishments which are subject to income tax currently consist of 16 forms of
business, namely:

1. Management place. 13. Providing services in any form by

2. Branch company. employees or by others, as long as they
3. Representative office. are carried out for more than 60 days in a
4. Office building. period of 12 months.
5. Factory. 14. A person or body acting as an agent
6. Workshop. whose position is not free.
7. Warehouse. 15. Agents or employees of insurance
8. Space for promotion and sales. companies that are not established and
9. Mining and extracting natural resources. are not domiciled in Indonesia who
10. Oil and gas mining working area. receive insurance premiums or assume
11. Fisheries, animal husbandry, agriculture, risks in Indonesia.
plantation or forestry. 16. Computers, electronic agents, or
12. Construction, installation, or assembly automated equipment that are owned,
project. leased, or used by eclectronic transaction
operators to carry out business activities
through the internet.
Differences in Tax Treatment compared with other
domestic taxpayers

BUT cannot enjoy Indonesia's tax

treaty with other treaty partner
countries because it is not a
resident of Indonesia.

Net profit after tax received or

obtained by a permanent
corporation is subject to branch
profit tax.
 Tax BUT Object
Object of Fixed Business Tax
Pasal 5 ayat 1

1. Head office income from 2. Income as referred to in Article 26

businesses or activities, sale of
goods, or providing services in
Indonesia similar to those run or
carried out by BUT in Indonesia.
of Income Tax that is received or
obtained by the head office, as long
as there is an effective relationship
between BUT and the assets or
activities that provide said income.

Earnings from:
- BUT business / activity
- Assets owned / controlled by
BUT.
Performed in Indonesia and
similar to those carried out by
BUT.
TAX
BUT
OBJECT
Pasal 5 ayat 1
Head office income from:
- Business or activities.
- Sales of goods.
- Providing services.
Income referred to in Article 26, received or
obtained by the head office:
As long as there is an effective
relationship between PEA with
assets / activities that provide
income.
• Infographic Style Deductible Expenses for BUT
Income
Includes costs related to head office
income:
1. In connection with:
- business or activity;
- sale of goods;
- providing services;
similar to those run by BUT in
Indonesia.

2. Income as stated in:

Article 26, as long as there is an
effective relationship between BUT and
the assets / activities that provide
income.

AWESOME
TAX
Determination of BUT Profit
1. Head office administrative costs that may be
charged are related costs
with BUT businesses or activities, based on the
amount determined by the Director General of
Taxes.

2. Payments to the head office that may not be charged

as fees
include:
- Royalties / rewards in connection with the use of assets,
patents and other rights.
- Rewards in connection with management services and
other services.
- Interest, except interest related to banking business.

3. Payments from the head office that are not as permanent

income include:
- Royalties / rewards in connection with the use of assets,
patents and other rights.
- Rewards in connection with management services and
other services.
- Interest, except interest related to banking business.
Ilustration
(BUT Tax Object)
Arctic Co. established and domiciled abroad, and has BUT in
Indonesia. Arctic Co. And BUTnya conduct bus chassis sales
activities in Indonesia. During 2020, a sale made solely by
Arctic Co. IDR 3,500,000,000.00, the BUT sales are Rp
8,250,000,000.00. Arctic Co. Also doing bus machine sales
transactions worth Rp 1,525,000,000.00. BUTnya does not
provide these products. What is the value of the tax object

income for BUT owned by Arctic Co.?

Answer:

The tax object for BUT includes income by BUT itself and
income from the head office
for business activities similar to BUT activities.
The object of income tax
= 3,500,000,000 + 8,250,000,000
= Rp. 11,750,000,000.00

BUT Tax
THANK YOU
Y U L I N D A ….. R A H M A…. S A R I ….