Build your own house subject to VAT, see the criteria and how to calculate it

JAKARTA, KOMPAS.com – The government through the Minister of Finance Regulation (PMK) makes tariff adjustments for the implementation of value-added tax (PPN) for Self-Build Activities (KMS).

The regulation is contained in PMK Number 61/PMK.03/2022 concerning Value Added Tax (VAT) on Self-Building Activities. This rule is effective from April 1, 2022.

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KMS is an activity to build a building, either a new building or a building expansion, which is not carried out in a business activity or work by an individual or an entity, the results of which are used alone or used by other parties.

In addition, what is meant by KMS for individuals or entities that carry out KMS are activities to build new buildings or increase the area of ​​​​pre-existing buildings.

Including building construction activities by other parties for individuals or entities but VAT on these activities is not collected by other parties.

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Referring to the Circular Letter of the Director General of Taxes Number SE-53/PJ/2012, what is meant by KMS are building construction activities carried out through contractors or contractors but the construction activities are not subject to VAT, and the contractor or contractor is not a Taxable Entrepreneur (PKP). ).

That is, if the development process uses small contractors or contractors who are not included in the PKP criteria, then the KMS criteria are subject to VAT.

Meanwhile, the criteria for KMS that are subject to VAT include construction which mainly consists of wood, concrete, masonry or similar materials, and/or steel.

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The next criteria are for a place of residence or place of business activity, and with a total area of ​​residence or place of business of at least 200 square meters (m2).

Furthermore, in the process, individuals or entities that carry out KMS are required to report VAT payments, including, individuals or entities that are taxable entrepreneurs (PKP) reporting VAT deposits in the VAT Periodic Return (SPM) to the registered tax service office.

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