Cinvex Flooring Guide – , JAKARTA — Indonesian taxpayers are reminded that income from foreign stock portfolios, such as those in the United States, must be reported in their Annual Tax Return (SPT), especially if the funds are not reinvested domestically.
This directive is reinforced by Article 4, Paragraph (1), letter g of Chapter III of Law No. 7/2021 concerning Harmonization of Tax Regulations (UU HPP). The law explicitly states that dividends are subject to income tax (PPh). Consequently, this taxable income must be declared in the annual SPT.
According to the Directorate General of Taxes’ (DJP) Coretaxpedia portal, foreign dividends that do not meet reinvestment criteria are indeed required to be reported in the Annual SPT.
The DJP clarifies that “These foreign dividends must be reported in Appendix 2, Part C, Foreign Income.” This information is sourced from the DJP’s official explanation, as reported on Saturday, April 25, 2026.
Within Appendix 2, Part C, Foreign Income, taxpayers should detail the total dividend income received throughout the year. This data is typically available in the Stock Dividend Listing provided by securities companies.
Furthermore, Article 4, Paragraph (3), letter f of the UU HPP specifies that dividends are exempt from PPh if they are reinvested in Indonesia. The Indonesian government has outlined the eligible investment instruments in Ministerial Regulation (PMK) No. 18/2021, specifically in Articles 34 and 35.
These eligible reinvestment avenues span various financial market instruments, including debt securities (such as medium-term notes), sukuk, stocks, mutual fund units, asset-backed securities, real estate investment fund units, deposits, savings accounts, current accounts, and futures contracts traded on Indonesian futures exchanges.
Other financial market investment options encompass insurance products linked to investments, financing companies, pension funds, or venture capital firms that have obtained approval from the Financial Services Authority.
Beyond the financial markets, reinvestment opportunities extend to non-financial sectors. This includes infrastructure investments through government-business partnerships, investments in real sectors prioritized by the government, property investments in land and/or buildings, and direct investments in Indonesian companies.
Additionally, eligible investments include precious metals in the form of gold bars or ingots, collaborations with investment management institutions, channeling loans to micro and small businesses within Indonesia to support their operations, and other legitimate non-financial market investments in accordance with prevailing laws and regulations.
Article 36, Paragraph (1) of PMK 18/2021 stipulates that these reinvestments must be completed by the end of the third month for individual taxpayers (WP) or the end of the fourth month for corporate taxpayers (WP) after the end of the tax year.
It is important to note that even if foreign dividend income is reinvested in Indonesia and thus tax-exempt, taxpayers are still obligated to report their Gross Income in their Annual SPT under Appendix 2, Part B.
Summary
Indonesian taxpayers are reminded that income derived from foreign stock portfolios, including those in the United States, must be reported in their Annual Tax Return (SPT). This reporting requirement is mandated by Law No. 7/2021 concerning Harmonization of Tax Regulations, which stipulates that dividends are subject to income tax. Foreign dividends are to be declared in Appendix 2, Part C, Foreign Income, detailing the total dividend income received throughout the year. This information can typically be found in the Stock Dividend Listing provided by securities companies.
However, dividends are exempt from income tax if they are reinvested in Indonesia. The Indonesian government has specified eligible investment instruments, encompassing various financial market products and non-financial sectors. These reinvestments must be completed within specific deadlines after the end of the tax year. Even if foreign dividend income is tax-exempt due to reinvestment, taxpayers are still obligated to report their Gross Income in their Annual SPT under Appendix 2, Part B.