TAX AUDIT AND INVESTIGATION

here I will explain about tax audit and investigation

in my opinion the tax audit and investigation is very important

the main purpose of tax audits: increasing tax compliance through law enforcement efforts, which are
expected to increase tax revenues

we can conclude that the purpose of the tax audit is

A. PURPOSE OF TAX AUDIT

- test the compliance of taxpayer's tax obligations in accordance with the laws and regulations

- in order to implement the provisions of the regulations on taxation legislation

B. IMPORTANT THINGS IN TAX AUDIT

1. the scope of the Tax audit

 simple tax audit: examination of taxpayers in the framework of joint operations or
consortia, for all types of taxes. Consist of: PSK and PSL
 complete inspection (PL): examination of taxpayers in the context of joint operations or
consortia, in the field and at the office of the unit carrying out a complete tax audit for all
types of taxes

2. type of inspection:
 routine inspection: routine examination of the taxpayer in relation to the person's tax
obligations.
 special inspection: examination of taxpayers regarding problems related to the person.
 inspection of preliminary evidence: examination of taxpayers regarding indications of
criminal acts in taxation
 inspection of location taxpayers: checks carried out on branches, representatives,
factories, or places of business of the domicile taxpayers, whose locations are outside the
working area of the compulsory domicile tax audit unit.
 inspection of the current year: examination of taxpayers carried out in the current year
for certain types of taxes

3. tax audit steps

 a. tax inspection program
b. tax audit techniques: browse – looking for - collect – process (data)
c. tax audit procedure:
 evaluate
 analyze numbers
 test linkages
 utilize data from related parties
 test physical truth
 recalculate numbers down and sideways
 inspect
 verify
 test the correctness and authenticity of documents
 confirm to related parties
 conducting interviews with taxpayers
d. method of tax audit:
 direct: test the correctness of numbers on SPT through tracking financial
statements, balance sheets, ledgers, etc.
 and indirect:
analyze:
o current year and previous year financial statements
o cash transaction
o bank transaction
o source and use of funds
o net worth
o year gross profit checked
o depreciation of assets
o taxpayer living costs
o etc
e. tax audit results:
 report on tax audit results
o level of administrative compliance
o level of material compliance and formal juridical
o correction difference

4. scope and period of examination of certain taxpayers

NO TAXPAYER GROUP SCOPE OF PERIOD OF AUDIT

IMPLEMENTATION
1 Special entity taxpayer:
o stock exchange taxpayer PSK 2 weeks
o permanent business form of the PSK 2 weeks
bank
o BUMN / BUMD PSK 2 weeks
 2 Individual taxpayers and other large PL/PSL/PSK 2 month/ 1 month
corporate taxpayers
3 Individual taxpayers and intermediate PL/PSL/PSK 2 month/ 1 month/ 2
corporate taxpayers, including weeks
professionals
4 Small taxpayers and individual taxpayers PSL/PSK 1 month/ 2 weeks
do not run businesses or free jobs

5. re-inspection
in principle, the taxpayer who has been examined will not be examined again for the same tax
year. but will be re-examined if a taxpayer tax year is examined for a particular type of tax, then
the other types of tax will be checked again
Provisions for re-inspection:
o can only be done based on instructions and approval of the tax director general
o this instruction can be done if:
 there are indications that taxpayers carry out tax crimes
 there is new data revealed which causes additional tax payable
 there are other reasons

6. expansion of tax audits

expansion of audit can be carried out on the basis of the same reasons and with re-examination

7. application of sampling techniques

o so that the implementation of tax audits is more effective and efficient
o the addition of the sampling concept will help the examiner evaluate the overall system
of internal control applied by the taxpayer and draw the right conclusions regarding the
SPT
8. Peer review:
DJP regional office supervises the quality of the audit and compliance of the tax inspector against
the applicable provisions and then the results will be used as material for policy formulation in
the future

C. TAXPAYER'S RIGHTS AND OBLIGATIONS WHEN AN INSPECTION IS CONDUCTED

a. The right of the taxpayer if an inspection is conducted:

o ask the tax examiner to show identification
o request a tax audit warrant
o refused to want to be examined if the officer did not show identification
o asking for an explanation of the intent and purpose of the examination
o requesting proof of loan for books, records and documents borrowed by the tax inspector
o ask for clarity about the differences between the results of the examination and the SPT
o submit a complaint if the confidentiality of the business of the taxpayer is unloaded to
another party
 z obtaining the original report on the sealing of the place

b. obligation of the taxpayer if an inspection is conducted:

o show or lend books, records, documents needed by the examiner
o give the examiner the opportunity to check the room
o give oral / written information requested by the examiner

D. TAX INVESTIGATOR

1. investigator's authority:
o receive, search, collect and examine all reports of criminal acts in the field of taxation, so
that the report is complete and clear
o receive, search, collect and examine all taxpayer actions related to criminal acts in the
taxation field
o requesting evidence to the taxpayer
o conduct a search to obtain evidence
o prohibit foreigners from entering the room being checked
o photographing people related to criminal acts in the field of taxation
o call a witness to hear his statement
o stop the investigation

2. legal actions that can be carried out by investigators:

o summoning suspects and witnesses
o restrictions on the freedom of the person being called
o search
o examination of certain places suspected of having evidence
o foreclosure
o take-over / store certain items

3. termination of investigation
o the investigation will be stopped if:
o there is not enough evidence
o events are not criminal acts in the taxation field
o the event has expired
o suspect died
o etc
PERTANYAAN

please give me an example of a tax audit

answer:

checks can be done in various ways, namely:

- inspection of the notification letter indicates tax payment

- annual notification of income tax indicates loss

- Notification letter is not delivered at the time specified

- and inspection because there are indications of tax obligations other than the obligation of the
notification letter not fulfilled

etc