REAL ESTATE & PROPERTY

REAL ESTATE & PROPERTY

REAL ESTATE & PROPERTY

Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this also an item of real property, more generally buildings or housing in general.

The word property leads to the legal aspects of such rights and ownership of land and processing and development.

Although property is more commonly used by various parties in the media to explain about the land and buildings, the Directorate General of Taxation prefers the term real estate in the Business Field Classification (KLU) to appoint a group of entrepreneurs who make a purchase, sale, leasing and operation of land and buildings.

In general, types of taxes attached to a real estate and property industry can also be classified as follows:

Taxes borne by the purchaser

  •  VAT
  • Duty On Acquisition Of Rights To Land And Building (BPHTB) of land owning
  • Income Tax Article 22 of Real Estate that categorized in luxury goods

Taxes related to Real Estate Taxpayer

  • Income Tax Article 4 paragraph (2), Corporate Income Tax from Real Estate Taxpayer as per 1 January 2009
  • Duty On Acquisition Of Rights To Land And Building (BPHTB), Land Acquisition
  • Income Tax Article 21, Salary, Payroll
  • Income Tax Article 23, Heavy Equipment Rental
  • Stamp Duty, Work Agreement

On land and buildings purchase, purchaser must settle taxes such as VAT, VAT luxury sales and Duty On Acquisition Of Rights To Land And Building. VAT and VAT luxury sales tax levied by the seller, while BPHTB must be paid prior the deed of purchase signed by a notary.

Our experience in assisting our clients in Real Estate and property industry are as follows:

  • Tax Audit (all taxes)
  • General tax consultation
  • Objection
  • Appeal
  • Judicial Review
  • Tax Amnesty

Below are related tax regulations in this sector:

  • Law Number 28 Year 2009 Regarding Regional Taxes And Regional Levies.
  • Government Regulation Number 71 Year 2008 Third Amendment To Government Regulation Number 48 Year 1994 Regarding The Payment Of Income Tax On Income From The Transfer Of Right To Land And/Or Building.
  • Regulation Ministry of Finance (MoF) Number 200/PMK.03/2015 Regarding Taxation Treatment For Taxpayers And Taxable Entrepreneur Using Certain Collective Investment Contracts Scheme in the Context of Financial Sector Deepening.
  • Circular Letter Number SE – 30/PJ/2013 Implementation Of Final Income Tax On Income From Assignment Of Right To Land And/Or Building Received Or Earned By Taxpayers Whose Core Business Is Conducting Assignment Of Right To Land And/Or Building And Determination Of Gross Amount Of Value Of Assignment Of Right To Land And/Or Building By Taxpayers Conducting Assignment Of Right To Land And/Or Building.