Government Updates Regulation on Tax Audit Procedures
The government has revised tax audit regulations by issuing Minister of Finance Regulation (PMK) No. 15 of 2025, which repeals the previous regulations, namely PMK No. 17/PMK.03/2013, last amended by PMK No. 184/PMK.03/2015 and PMK No. 18/PMK.03/2021.
In general, PMK 15/2025 comprehensively regulates tax audits, covering: audit standards, audit timeframes, final discussion periods, audit extensions, testing procedures, tax auditors’ obligations and authorities, taxpayers’ rights and obligations, audit implementation, audit report preparation, audit suspension, and re-audits.
As a reminder, a tax audit is defined as a process of data collection and analysis to assess taxpayer compliance.
With this regulation, which took effect on February 14, 2025, several provisions related to tax audits have been updated. One key change is the shortened timeframe for testing and final discussions.
Under the new rules, the government has shortened the deadline for taxpayers to submit a written response to the Notification of Tax Audit Findings (SPHP) and the list of findings received. Previously set at a maximum of seven days, it is now reduced to five days.
Additionally, the government has provided more detailed criteria for audits related to compliance testing, as well as for other audit purposes.
Types of Tax Audits
According to PMK No. 15/2025, there are three types of tax audits. First, a comprehensive audit, which is a thorough examination of all items in the Tax Return (SPT).
Second, a focused audit is an audit that only focuses on one or a few specific items in the tax return. Third, a specific audit, a targeted audit covering one or several items in the tax return, Tax Object Notification, and tax data in a simplified manner.
In conducting audits, the Director General of Taxes will delegate authority to officials within the Directorate General of Taxes (DGT)
Read: Taxpayers Can Do The Voluntary Disclosure of Tax Returns Before SPHP is Issued
In addition to the duration of audits and final discussions, the government has also changed the time limit for extending testing periods related to audits of taxpayers within the same group or taxpayers engaged in transfer pricing transactions.
Previously, the maximum extension period for testing was six months, with a maximum of three extensions. However, under the new regulation, the timeframe has been shortened to a maximum of four months.
Clarification on Tax Types Subject to Audit
Through PMK No. 15/2025, the government has also clarified the types of taxes that may be audited. These include four main categories of taxes:
- Income Tax
- Value Added Tax
- Sales Tax on Luxury Goods
- Stamp Duty
- Land and Building Tax
- Sales Tax
- Carbon Tax
Other taxes administered by the Directorate General of Taxes under applicable laws and regulations
In the previous regulation, the scope of audits for assessing compliance with tax obligations was only stated to cover one, several, or all types of taxes, including those for one or multiple tax periods, parts of a tax year, or tax years from previous or current periods.
Tax Audit Process
The tax audit process regulated under PMK 15/2025 includes bookkeeping, sealing, discussion of preliminary findings, final discussion of audit results, Preliminary Evidence Examination, and re-audits.
Additionally, taxpayers have the right to request a discussion with the Tax Audit Quality Assurance Team before the final discussion of audit results takes place.
In its considerations, the government stated that PMK 15/2025 was drafted to provide legal certainty in tax audits, including land and building tax audits, which are currently regulated under multiple regulations.
Furthermore, this regulation also serves as a follow-up to the issuance of Government Regulation (PP) No. 50 of 2022 on the procedures for exercising rights and fulfilling tax obligations. (ASP/KEN)
