8. Revaluation
Revaluation according to the provisions of Statement of Financial Accounting Standards (PSAK 16 paragraph 29) is an accounting treatment that is not allowed because the substance of violating basic principles of accounting concepts. However, PSAK 16 allow for any provision of the government.

In terms of taxation, subject to revaluation in Circular Letter No. SE-29/PJ.42/1998 can be used as a means of tax savings because of differences in tax rates, where the revaluation is subject to the provisions of Income Tax shall be final for 10% of the profits after deducting revaluation with compensation losses last 5 years.
Revaluation can be done to take advantage of compensating the losses because the company is owned by a period of loss compensation expired after 5 years. Also a lot of potential that can be extracted profit from the revaluation. Although this revaluation adopted a final income tax at a rate of 10%, but the inaccuracies in determining the revalued assets that would be the company's financial disadvantage. Therefore, the revaluation should be done only on assets that can be depreciated and the group of assets that have a specific benefit period. The longer depreciating asset is also the smaller the financial benefits we can get through this instrument.
Given the amount of potential tax savings from the treatment of this revaluation, very unfortunate if the revaluation is only done to compensate for losses in the period before or with the purpose of the retained earnings balance to be positive.

9. Soon spring Expenditures
The suspension system of accounting adopted expenses and charge them in proportion to the contribution of these expenditures over time or to a specific size. Let's say the company pays the cost of fire insurance in July for the duration of 1 year. So according to the concept of accounting, the cost of some (half) to suspend it in the next period. So that the cost is half of the period (July to December).
Pending charges caused the company recorded a higher profit than the charge the company. Higher profits led firms to pay higher taxes too. Therefore the costs should be charged at once in the period incurred.
This is made possible because of Article 9 paragraph (2) of Act No. 17 of 2000 states that: Expenditure to get; collect and maintain the income that has a useful life of more than 1 (one) year is not allowed to be charged at once. And so on.
There was no explanation of the notion "1 (one) year" is, so even through different 2-year, 1-year provisions are met, so it can be charged at the same time under the law

10. Suspend Income
Accounting in addition to adopting the suspension load, is also the principle of Accrual, ie income is recognized proportionately with the work time or a certain performance measures, without waiting for the payment of such achievements. For example, the company has completed the laundry orders made by customers, but the order has not been paid by the related, are accounting for the work has been recognized and acknowledged the existence of income claims to customers of such receivables.
Recognition of income that does not coincide with the entry of cash into the company, causing the company will report a profit from operations, while the benefits are not supported by the entry of cash into the company. This can lead to liquidity problems the company in fulfilling tax obligations, because the unequal income recognition and the company's ability to pay the tax obligation.
If the firm earns a loss on this transaction, then immediately did the recognition of the losses suffered in the current period, but if the company would book a profit on this transaction which will delay the benefits of this happening, at least until the next period by using an alternative method of revenue recognition or can be made possible by the positive law with the treaty with tough conditions.
The delay recognition of this advantage, even if only one period of material impact on company finances. Illustration of this calculation are presented in the box below. Therefore, companies should choose a particular accounting method that can postpone income, as long as it is recognized and accepted by the applicable tax provisions.

11. Putting Profits, Losses Accelerate
At certain periods, sometimes companies do deals that is very material that it can lead to profit (gain) or loss (loss) is large. This transaction example, the company did release the assets or sell one of its business segments to other parties. Usually a company will register gains or losses over this transaction.
If the firm earns a loss on this transaction, then immediately did the recognition of the losses suffered in the current period, but if the company would book a profit on this transaction which will delay the benefits of this happening, at least until the next period by using an alternative method of revenue recognition or can be made possible by the positive law with the treaty with tough conditions.
The delay recognition of this advantage, even if only one period of material impact on company finances. Illustration of this calculation are presented in the box below.
Dated October 1, 2003 the Company made a corporate vehicle rejuvenating outdated models (out of fashion) and plans to replace it with a new vehicle a more stylish. Book value of all vehicles amounted to Rp 1 billion and sales to third parties acquired cash of Rp 2 billion. Above transaction the Company reported a profit for the release of these assets amounting to Rp 1 billion.
But because the company did release on condition that this asset is tough, which is legally a new proof of ownership transfer occurred in January 2004, then the new transaction gains recorded in January 2004. Thus the company can delay payment of the tax obligation for 1 year.
If the effective tax rate of 30% and cost of capital by 10% then the company has made savings of this tax obligation of Rp.28 million (300 million - (300 million: 1.1)).

12. Compensation in Money Vs. Natura
The provisions in Article 4 paragraph (3) letter d, of Law No. 17 of 2000 on Income Tax that is not included as tax object is: "replacement or compensation in connection with the employment or services received or acquired in kind and or pleasure of the taxpayer or the Government "
Since the return in kind is not included in the tax object, so therefore this expenditure; spring companies can not and those receiving compensation are not included in the additional terms of income. Theoretically, this exemption facility can affect the total tax liability is paid the company, because generally there are differences in effective corporate tax rate to effective tax rate the company's employees.
If the effective tax rate is 30% then the company has a "loss" of 30% of the total remuneration of loans granted to employees, whereas if the effective tax rate for employees is 10% then the firm earns a "profit" for this tax savings of 20% of compensation provided in kind.
Thus, the use of instruments in exchange for this kind will only be effective if the effective corporate tax rate is lower than the effective tax rate of employees. So that the ideal conditions for the application of this facility is when a company in the current year is estimated to have losses.
Example: The company is expected to come will experience profits or losses before a salary of Rp 1 billion, 'the Company has a salary cost of Rp 200 million, and plans to give its employees a salary increase of Rp 50 million. The increase in compensation can be given in cash or in kind. When in the form of cash then the company must provide tax benefits for an additional 10% of these rewards (eg. effective tax rate for employees is 10%). Which scenario is the most profitable company?
That for the record company profits and effective corporate tax rate higher than the effective rate of tax benefits the company; gift in the form of cash rewards will be more profitable and vice versa.

13. Money allowance Eat or Eat Free?
To provide relief to employees for consumption in the workplace, companies can provide meal allowances for each month is calculated at a rate per day food allowance for each employee level.
In relation to taxation, the provision of such meal allowance, will be payable Tax Article 21 employees who will be merged with the salary component and other allowances. Whereas in relation to the Income Tax Agency, Benefit Dinner Money Expense is deductible.
Article 9 paragraph (1) letter e, of Law No. 17 of 2000 on Income Tax states that to determine the amount of taxable income for taxpayers in the country and the permanent establishment shall not be deducted:
"E. Replacement or compensation in connection with the work or services provided in kind and enjoyment, except the provision of food and beverages for all employees ... etc. "
These provisions provide an alternative for you to evaluate whether employees will be given allowances for free meals or eating alone workplace. Illustration two alternative calculations are as follows:
The Company has been providing salary and allowances Rp.1.5 billion, including meal allowances of Rp 200 million. Which scenario is the most profitable company if the mechanism is converted into free meals at work in conditions of profit before tax Rp.1 billion and Rp 1 milyar loss, the company effective tariff rates 30% and 10% of employees income tax.
This happens because the free food at work Expense is deductible but not the object of income tax employees.
In this example, income tax deducted from employee's payroll so the total benefit of employees will increase with the free meals for employee income tax withholding down. If the income tax paid by a company employee, the tax savings can be obtained by applying the company's reimbursement allowances for food with free meals.

14. Capital Lease vs Cash
Capital Lease provisions regarding regulated Decree of the Minister of Finance No. 1169/KMK.01 / 1991, in which the capital lease criteria are:
a. Agreement includes an option for the lessee
b. Leasing period:
- goals I> 2 years
- goal II & III> 3 years
- building> 7 years
Purchases of assets in cash only the depreciation costs for the company for a certain period in accordance with the provisions of depreciation of fixed assets. While the purchase of assets by way of lease (capital lease) under the Minister of Finance Decree No. 1169/KMK.01 / 1991, the company can recognize all the payments made for the repayment of capital leases as expenses, except the last payment that was agreed by the lessee and lessor as a value remainder of the assets that became the object of leasing.
Planning on how many years the cost will be allocated depending on the number of installments will be made. So the company can arrange more flexible loading time compared to cash purchases, in which its provisions are standard, the imposition of leasing depends on you and the lessor, may shorten or take longer.
Example: Company made a 4-year lease to purchase equipment as follows:
Cash Price Rp 1,000,000,000
Interest 12.5%
Annual installments of Rp.329,234,500
Then the imposition of the first year could be the third respectively Rp 329,234,500. As for the fourth year-end payments to the acquisition price of fixed assets which are depreciated starting in the fourth.
Recognition of differences in how these costs of different financing models provide the potential for corporate tax savings. Of course, the calculations are accurate technically required in estimating the benefits of this financing option way, that is about the size of opportunity cost of idle cash because they do not pay cash. Is embedded as an investment or deposit with the Final Income Tax 20%, each company can have the optimal point different.
Other tax benefits that should be considered is the provision of article 23 paragraph (4) is not done cutting Income Tax Article 23 of the rent paid or payable in connection with the lease with option rights.

15. Reduce Installment Tax
Indonesian tax laws require taxpayers to make tax payments on a monthly basis. This provision is an existing obligation on the taxpayer in accordance with the provisions of the Law of Income Tax Article 25, or what we usually know the installment Income Tax article 25. The amount of payments we have to pay this is the division of income tax payable is reduced Income Tax article 22, 23, 24 years ago, the numerator divided by as many as 12 months.
Things we can do to ease our financial burden in order to normalize the mortgage tax is a regular income that we reported in the annual SPT.
In addition to the normalization of income, we also make our payments reduced by reducing payments apply as stipulated in terms taxation. The procedure to perform general reduction obligations are as follows:
1. Who can propose a reduction of Income Tax Article 25 is a company that has financial statements in the period which shows estimated losses that occur more pay.
2. Reduction mechanism, with a written request to the Directorate General of Taxes through the Tax Office listed.
3. Application attached with the financial report presents the petition to the moon and the projected reduction in the financial statements rest period.
4. For a state-owned companies, the reduction can be as long as there is a change proposed Work Plan and Budget Company (RKAP).
Example: The Company has tax payments in 2003 amounting to Rp 150 million per month, in April 2003 the company made a request to lower the mortgage company to Rp 100 million. At the end of the year the company recorded a profit of USD 1.8 billion rupiah.
What are the benefits of reduced mortgage company if the cost of capital of 12%?

16. Zakat as an Instrument Utilizing Tax Exempt
In general, the principle of taxation able tax tax deductible, non-deductible non-Taxable". But in accordance with the provisions of law there are some financing vehicles that can be a tax deduction even for those who received no object falls into the category of tax. An example is the "Zakat" (Article 9 of Law No. 17 of 2000).
Companies as profit-producing organization, did not escape the demands of society for its social contribution, although this is not the duty of the company.
Some specific industries, issued a considerable cost in the form of donations to meet the demands and expectations of society. Social expenditure cost the company as this, aims to maintain environmental harmony, only the contribution does not include elements that can be a tax deduction.
Therefore, to overcome this company can take advantage of charity organizations that have been approved by the government to channel funds to those entitled pursuant to the public.
Thus the company's costs would be to remove the deduction from corporate income. Thus, each Rp 10 rupiah company expense, then the company can make a tax savings of Rp 3 compared with a donation.

17. Handling of Final Earnings
To strengthen the going concern, companies need to diversify the business. And often these types of business are far different characteristics, there is a final and there is not final.
As already illustrated in the previous chart that the final revenue and the accompanying costs must be excluded from the calculation of income tax payable for that year. Sometimes direct identification can not be done on the costs associated with the Final Income Tax, so you have to do the comparison is proportional to the revenue earned.
This is not a problem if the income is not final and Final Revenue has the characteristics of different operating costs due to the different degrees of complexity. Distortion can occur allocation of operating costs with the actual characteristics for allocation pursuant to Article 6 Law Act No. 17 of 2000, conducted by base revenue.

In the handling of taxes, in reality it is difficult to directly identify the operating expense. Therefore, according to the calculation of tax provisions are as follows:

So the operating costs of consultant services = 500/1300 * 200 = 77, so that the total taxable income = 200 to 77 = 123.
In this example there is distortion of the characteristics of revenue with taxable income because the company could not immediately identify the operating costs.
If this happens on a large scale, should have evaluated these distortions, and then determine whether or not there is separation of departments that have a separate report or not.

18. Using the instruments of international tax
Another important instrument is the element of international taxation. This related to the existence of the lex specialist in international taxation, especially related to the tax treaty. The use of these instruments are of course different considering different tax rates in the tax treaty.
a. Establish a subsidiary in Foreign Affairs or the permanent establishment
Business development abroad requires supporting the management of Foreign Affairs. Supporting what we need to be forming a subsidiary in Foreign Affairs as a separate business entity. The consequence of this alternative choice, that the tax on subsidiary management refers to the tax laws in the country. Income received by companies is the dividend payable.
The second alternative is to form a permanent establishment (in the tax law Indonesia: Permanent Establishment) where all the income in foreign income will be foreign companies.
This need to know to perform calculations done on the value of an ideal contract for you.

Because the treatment of companies and permanent establishment in a different tax, the company needs to do an analysis of the two alternatives, which is more profitable to look at the provisions of state tax treaty with Indonesia. Similarly, if foreign companies want to open a business in Indonesia.
b. Contract services
Service contract with parties in other countries are usually unique. Common characteristic is that the entire tax deduction / collection services are paid by the recipient (contract net).
If you experience this, so before you make a contract you should look back a tax treaty provisions on services between Indonesia and the country where the service provider is located. How long will test his time, how much is the charge, and others.
This need to know to perform calculations done on the value of an ideal contract for you.