Article 4(3) Income Tax on Certain Net Surplus or Profit
- Maulana Ibrahim, Andre Wilson Siregar, Ellicia Emerliawati, & Nugraha Wira Taruna
- 4 days ago
- 2 min read
Certain Net Surplus Excluded as Tax Objects
Certain Net Surplus (SHU) or business profit received by certain agencies, such as cooperatives, limited partnerships (CV) whose capital is not divided into shares, partnerships, associations, firms, and joint ventures, holders of collective investment contract participation units are excluded from being an income tax object for their receiver.
This decision is based on the fact that income in the form of a certain net surplus or profit for businesses from these agencies is already considered as a tax object on the agency level, thus, the taxes imposed on the investor level (in this context, the receiver of the net surplus or profit), are not needed. The exclusion of tax objects is meant to increase fairness and avoid any chances of double taxation.
Table of Contents
Tax Subject
Domestic Individual Income Taxpayers receiving or obtaining income in the form of net surplus or profit from cooperatives, limited partnerships (CV) whose capital is not divided into shares, partnerships, associations, firms, and joint ventures, holders of collective investment contract participation units.
Non-Tax Object
Part of the profit
Certain Net Surplus is the surplus or deficit as part of a business result received from business proceeds or cooperative income in 1 (one) book year after being deducted with expenses on various business loads.
Criteria
Income in the form of a part of the profit or net surplus received by members of cooperatives, limited partnerships (CV), whose capital is not divided into shares, partnerships, associations, firms, and joint ventures, holders of collective investment contract participation units, is excluded as an income tax object.
For tax purposes, these agencies are considered a community of their members who are taxed as a single unit at the agency level. Thus, the part of the profit received by these members is no longer considered as income tax objects.
Net Surplus Receiver Obligation
Individual Taxpayers, as the receiver of the net surplus or profit, have the obligation to file their entire income received from the previously mentioned agencies in the Annual Income Tax Returns (SPT) in the Non-Taxable Income section.
Case Study
Mr. Joni is a member of the Anak Hebat cooperative. In 2024, Anak Hebat cooperative distributed its net surplus to its members, with a value of IDR200,000,000. Thus, the income that Mr. Joni received from the cooperative’s net surplus distribution is exempt from being an income tax object.
Legal Basis
Law Number 7 Year 1983 regarding Income Tax as lastly amended by Law Number 6 Year 2023 regarding Stipulation of Government Regulation in Lieu of Law Number 2 Year 2022 on Job Creation to Become Law
Law Number 17 Year 2012 regarding Cooperatives
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