1.

Timeline and Deadlines for Special Form[1]

PER 28/2018 prescribes a five working days decision period for Special Form approvals and provides rejection/acknowledgement specimen letters.

The timeline has changed to 10 calendar days.

2.

The Certificate of Domicile (CoD) Format[2]

Requires the name of the transaction counterparty or its Taxpayer Identification Number.

No longer requires the name of the transaction counterparty or its Taxpayer Identification Number.

3.

CoD Validity Period[3]

The validity follows as stated in the CoD form, maximum 12 months period. If no validity period is stated, it will be considered as invalid CoD.

As stated in the CoD, maximum 12 months period. A CoD without a stated validity period is assumed to be valid only in the month it was issued.

4.

DGT Form Completeness Check[4]

No requirement for the tax withholders/collectors to check the completeness of the DGT form and the entitlement of the tax treaty benefits.

Withholders or collectors must not only verify the completeness of a DGT Form but also confirm that the foreign taxpayer is genuinely entitled to treaty relief, including verifying residency status and ensuring no treaty abuse is involved.

  5.

DGT Form Section[5]

The DGT Form has part VI (Beneficial Owner test), which was completed only by recipients of dividends, interest, and royalties.

The former standalone Beneficial Ownership (“BO”) section (Part VI) in the new DGT Form has been removed and consolidated into Part V, which all foreign income recipients must now complete (please refer to Appendix 1). The previous requirement of BO questions to be answered in a specific manner no longer applies.

6.

DGT Form Submission[6]

A foreign taxpayer was generally required to submit a valid DGT Form before the application of tax treaty benefits (i.e., prior to withholding/payment). Failure to submit the DGT Form within the prescribed timeframe could result in the denial of treaty benefits, even if the taxpayer was substantively entitled to such benefits.

PMK 112 of 2025 allows treaty benefits to be granted even if the DGT Form is submitted during an audit, objection, or assessment‑related process, as long as the taxpayer meets substantive eligibility criteria.

7.

Requirements to Apply Lower Withholding Tax (WHT) Rates on Dividends[7]

There is no specific provision in PER 25/2018 on this point, as the applicable withholding tax rate generally follows the relevant tax treaty provisions. The 365-day holding period requirement would only be relevant where the applicable treaty has adopted (or been modified by) the Multilateral Instrument (MLI).

Where a tax treaty prescribes two dividend WHT rates tied to the level of share ownership, the reduced rate may be used if the corporate WPLN is the beneficial owner of the dividend and satisfies both of the following conditions:

• It holds at least the required percentage of shares; and
• It maintains that ownership for a minimum of 365 calendar days, counted to include the dividend payment date.

This approach aligns with the concepts reflected in Article 8 of the MLI and Article 10 of the OECD Model. If these criteria are not met, the dividend is subject to the higher treaty rate, assuming the WPLN remains the beneficial owner of the income.

8.

Taxing Rights on Capital Gains on the Transfer of Shares of Entities With Significant Immovable Properties[8]

There is no specific provision in PER 25/2018 on this point, as the applicable withholding tax rate generally follows the relevant tax treaty provisions. The 365-day holding period requirement would only be relevant where the applicable treaty has adopted (or been modified by) the MLI.

PMK 112 of 2025 provides that Indonesia may tax capital gains arising from the transfer of shares or comparable interests in an entity where:

• the proportion of immovable property to the entity’s total assets exceeds the threshold set out in the relevant tax treaty; and
• that threshold is satisfied at any point within the 365 calendar days preceding the transfer.

If these criteria are not met, the taxing right over such gains is allocated to the other Contracting State under the applicable treaty. This rule reflects the approach in Article 9 of the MLI and Article 13 of the OECD Model.

9.

Anti-Abuse Provisions[9]

Limited Coverage of Anti-Abuse provisions in the DGT Form.

PMK 112 of 2025 expanded and formalised anti-abuse regime as follows:

• Beneficial Ownership tests – similar with PER 25/2018.
• Explicit Limitations on Benefits – specific criteria to determine whether a taxpayer may claim treaty benefits.
• Principal Purpose Test – to prevent the granting of treaty benefits when obtaining those benefits is the primary, or one of the primary objectives of an arrangement or transaction.
• Conduit rules and substance indicators – provision of requirements to apply lower WHT rates on dividends and requirements to determine taxing rights on capital gains on the transfer of shares of entities with significant immovable properties.

10.

PE Guidance[10]

PER 25/2018 provided limited guidance on PEs.

PMK 112 of 2025 provides detailed PE guidance and aggregation rules to prevent artificial avoidance of PE status, including:

• Commissionaire arrangements – a PE will be deemed to exist where a dependent agent plays a key role in the conclusion of contracts.
• Specific activity exemptions - ensures that activities (e.g., preparatory or auxiliary), whether performed directly or through closely related parties in Indonesia, must genuinely be ancillary and not constitute core business operations.
• Splitting of contracts – for purposes of applying the time threshold, the presence of foreign taxpayers and its closely related persons will be aggregated when each presence exceeds 30 days and the projects occur at the same location.