Indonesia’s VAT requirements

Indonesia’s e-invoicing system and continuous transaction controls

After experiencing challenges in its tax control system, Indonesia adopted an e‑invoicing system, locally known as e‑Faktur. Leveraging data reported in real-time via continuous transaction controls (CTCs) allows the Indonesian tax authorities to reduce occurrences of fraud whilst helping to close the tax gap.

Have questions? Get in touch with a Sovos Indonesia CTC expert.

CTC reforms

Introduced in 2014 and effective from 2016, Indonesia’s e‑invoicing system seeks to combat the tax gap. Indonesia’s solution was the implementation of an invoice clearance system, where invoices must be approved by the local tax authority prior to being sent to a customer.

Quick facts

  • E-invoicing has been mandatory for all corporate VAT taxpayers since July 2016.
  • E-invoices (e-Faktur Pajak or e-FP) should be created by applications and systems prescribed by the Director of Taxation (DGT). These include client desktop, web-based and host-to-host applications.
  • Electronic signatures are required for the issuance of e-invoices.
  • It’s compulsory for all invoices to be processed and issued electronically via the government hosted eFaktur platform. The submission platform for the VAT return has been integrated with the e-invoicing platform.
  • Electronic certificates are required to verify taxpayer identity and are valid for two years.
  • Activation code and password are required for access to e-Nofa to request electronic tax invoice serial numbers.
  • Using e-Faktur, VAT returns are periodically submitted (typically monthly).

Mandate rollout dates

2014 – e-Faktur Pajak introduced

2016 – e-Faktur Pajak became effective

1 October 2020 – New e-Faktur Pajak version 3.0 released

How can Sovos help?

Need help to ensure your business stays compliant with the e-invoicing obligations in Indonesia?

Our experts continually monitor, interpret and codify changes into our software, reducing the compliance burden on your tax and IT teams.

Learn how Sovos’ solution for VAT compliance changes can help companies stay compliant in Indonesia and around the world.