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Gst / VAT / PPN payable by Pondok Wisata owners for using OTAs

Discussion in 'Owning Property in Bali' started by Nins, Jan 13, 2018.

  1. Nins

    Nins New Member

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    Hi all.. we plan to operate a pondok wisata up at lovina. There is tax officer advising us about PPN on online booking agent fees that villa owners need to pay to Central tax office, on top of the 1% gross revenue tax to central tax office and the 10% customer hotel tax imposed by the Buleleng regency.
    Background of it is the PPN 10% on purchased goods and services.

    http://www.pajak.go.id/content/article/pajak-atas-transaksi-dengan-agen-travel-daring

    Anyone has the English version of this news pls? TIA..
     
  2. spicyayam

    spicyayam Well-Known Member

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    If you go to the tax office in Singaraja they are helpful answering any questions.

    I have read some posts on FB about the tax required on OTA fees. It seems quite ridiculous but what can you do about it.

    Some people were saying companies like booking.com don't pay tax in Indonesia. Seems unfair to make hotels collect the tax on their behalf. If booking.com doesn't have a tax obligation in Indonesia why should hotels have to pay it. For hotels it is an expense.
     
  3. Nins

    Nins New Member

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    Hi Spicyayam... yes the officer even replies my email and smses, but in bahasa :) the rest of my neighbours are foreigners so they asked if if i could help and ask for the formal letters from authority. The officer sent me link to the article above, but so far there is no formal surat edaran etc fr the tax office themselves..
     
  4. spicyayam

    spicyayam Well-Known Member

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    Google translates gives you a reasonable idea what the article is talking about:

    The development of technology in the business world requires all business actors to be dynamic and responsive to follow the latest trends. The business actor must be able to equate the steps with the development of technology, especially information technology that increasingly bolted the speed. Online shopping is now even a daily lifestyle of some consumers. With a device that is always in the grip, then the various transactions can occur in a short time with one touch. One of the most commonly used online shopping apps is ticketing and hotel reservations. Consumers who want to travel to any part of the world can make hotel reservations with ease. Responding to such market conditions, online reservation companies, both local companies and overseas-based companies, have been born and grown in recent years.

    The presence of a third party in the transaction between the consumer and the hotel, gave birth to a new economic value, namely the rewards received by the online reservation company as a wage for his efforts to connect consumers with the hotel. Ease of service gained often makes all parties terlena. The hotel can now reduce marketing costs including marketer labor costs and have the opportunity to get consumers only by "selling" images with a very wide range. Online reservation companies are now gaining market share from the new shopping mode of consumers, a touch of consumers already pouring funds into their accounts. Consumers, the king who is increasingly preoccupied with various activities, is now pampered with the convenience of hotel reservations that can be done anytime and anywhere.

    The various conveniences enjoyed by all parties make the faster the flow of transactions that occur, but unfortunately leave the tax inherent in the transaction. The flow of income from the hotel to the reservation company is an additional economic capability that must be taxed. The presence of economic value in the form of service reward received by online reservation company is an object that must be subject to VAT. Legal umbrella that regulates the imposition of taxes inherent in this transaction has been there since the first, not newborn to respond to technological developments that occur. But not all parties are aware of the taxes that follow the transaction with this new mode of development.

    With respect to the domestic reservation company, the hotel paying the amount of the remuneration shall be treated as a withholding of Article 23 Income Tax in respect of the services paid to the reservation company. A domestic reservation company that has fulfilled the requirements as a Taxable Entrepreneur (PKP) must be confirmed as a PFM and issue a Tax Invoice as proof of VAT collection on the delivery of reservation services.

    The tax deposit pattern becomes changed when the online reservation service partner is overseas and has no permanent establishment (BUT) in Indonesia. The imposition of VAT is subject to the following provisions. As set forth in article 3A paragraph (3) of the VAT Act, an individual or entity utilizing taxable services from outside the customs area shall collect, deposit and report on the payable VAT whose calculation and procedure shall be regulated by a Minister of Finance Regulation. Further, Regulation of the Minister of Finance Number: PMK-40 / PMK.03 / 2010 concerning the Procedure of Calculation, Collection, Depositing and Reporting of Value Added Tax on Utilization of Intangible Taxable Goods and / or Taxable Services from Outside Customs Area and Circular Letter The Director General of Taxes Number: 147 / PJ / 2010 concerning Regulation of Explanation of Regulation of the Minister of Finance Number: 40 / PMK.03 / 2010 describes matters relating to the imposition of foreign service VAT on the transaction of service utilization from outside customs area as follows:

    a. Taxable services from outside the customs areas are utilized within the customs areas:

    - Taxable Services are submitted by individuals or entities residing or domiciled outside the Region;

    - Provision of Taxable Services may be conducted inside and / or outside the Customs Area as long as the activities of providing Taxable Services do not cause any individual or entity residing or domiciled outside the Customs Area to be a domestic Tax Subject:

    - Activities of utilization of Taxable Services originating from outside the Customs Area are conducted within the Customs Area; and

    - Taxable services originating from outside the Customs Area are utilized by anyone within the Customs Area.

    b. VAT calculation: 10% rate multiplied by the amount paid or should be paid to the party who submitted the taxable service excluding VAT

    c. When VAT is due when the JKP is actually used; or when the acquisition price of JKP is stated
     
  5. Nins

    Nins New Member

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    wow many thanks Spicyayam!! I will print screen this and send to my neighbours..

    2nd question for north area:
    Is there such thing as "banjar membership fee"? I was asked to pay Rp 1 juta to the Banjar, as I am new property owner in the area. No letter Is issued for this collection.
    I talked to the Kepala Desa, and he told me, if there is no formal letter from his office, I should not pay anything of such. However I do not want to also upset the "balance" and make my employees suffer from it. What is your experience with such fee?
     
  6. spicyayam

    spicyayam Well-Known Member

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    Most banjars charge a fee, even to non-Balinese. Is it 1 juta a year? Some banjars are reasonable and others are asking for crazy amounts.

    You will need their help from time to time, so it is good to keep on their good side. You can meet some "rogue" people who may collect money for their own benefit, so always pay the money in their office and get receipts.
     
  7. Nins

    Nins New Member

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    The Banjar said 1 jt per year.. does it make sense? we monthly pay Banjar fee too.. The thing is, Banjar does not actually have office, right?
     
  8. Nins

    Nins New Member

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    OK so our caretaker went to the Desa office, and was told that the letter she brought from the banjar who wanted to to collect the Rp was a fake (it was not the Kepala Desa's signature).
    Now my caretaker is having a headache! I don't envy her :D I guess we just have to keep some hands greased knowing that we're being conned and still pay.. oh well!
     
  9. Mark

    Mark Active Member

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    That's a slippery slope to navigate (keeping hands 'greased'), though I hope it works out for you.
     
  10. Nins

    Nins New Member

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    Hi Mark
    Only time can tell!! Gosh we have been sanitized too long in sg!
     
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