Received a Tax Collection Letter (STP) and Penalties? Here’s How to Apply for Penalty Relief via Coretax

Business owners who receive a Tax Collection Letter (Surat Tagihan Pajak or STP) and are hit with tax penalties shouldn’t panic. Indonesian tax regulations grant taxpayers the right to apply for a reduction or waiver of administrative penalties.

So, what are the requirements and steps to apply for a penalty reduction or waiver through Coretax? Here is a practical guide based on Minister of Finance Regulation No. 118 of 2024 (PMK 118/2024).

Common Triggers for Tax Penalties

Generally, taxpayers incur administrative penalties for missing filing deadlines for Annual or Periodic Tax Returns (SPT), failing to submit tax returns altogether, underpaying taxes, or making errors in meeting their statutory tax obligations under the General Tax Provisions and Procedures Law (UU KUP).

Under Article 23(1) of PMK 118/2024, taxpayers may submit a formal request to the Director General of Taxes (DGT) for the reduction or waiver of administrative penalties—including administrative fines on Land and Building Tax (PBB)—that are stipulated in:

• Tax Assessment Notices (Surat Ketetapan Pajak / SKP);
• PBB Tax Assessment Notices (SKP PBB);
• Tax Collection Letters (Surat Tagihan Pajak / STP); and
• PBB Tax Collection Letters (STP PBB).

Key Eligibility Criteria for STP Penalty Relief

An application for the reduction or waiver of administrative penalties—including PBB administrative fines listed in an STP or STP PBB—can be submitted if it meets the following conditions:

1. For the STP or STP PBB itself:
   • No prior application for reduction or cancellation of the STP (or cancellation of the STP PBB) under Article 21(c) has been filed; OR
   • An application under Article 21(c) was submitted but subsequently withdrawn by the taxpayer and approved by the DGT; OR
   • An application under Article 21(c) was submitted but deemed inadmissible / not considered.
2. For the underlying tax document (the SKP linked to the STP, or the Notice of Tax Due/SKP PBB linked to the STP PBB):
   • No objection has been lodged;
   • An objection was lodged but withdrawn with formal DGT approval;
   • An objection was lodged but deemed inadmissible;
   • No application for reduction or cancellation under Article 21(b) has been filed;
   • An application under Article 21(b) was filed, but withdrawn with DGT approval;
   • An application under Article 21(b) was filed, but deemed inadmissible;
   • No application for cancellation under Article 21(d) is currently pending;
   • An application under Article 21(d) was filed, but withdrawn with DGT approval;
   • An application under Article 21(d) was filed, but formally rejected; OR
   • An application under Article 21(d) was filed, but deemed inadmissible.

How to Apply for Tax Penalty Relief via Coretax

With the implementation of Coretax, taxpayers can now submit their relief applications fully online.

According to official guidance from the DGT’s tax helpdesk (@KringPajak on X), here is the step-by-step application process:

1. Log in to your Coretax portal account.
2. Navigate to “Administrative Services” (Layanan Administrasi).
3. Select “Create Administrative Application” (Buat Permohonan Administrasi).
4. Choose the service category: “AS.26 – Objections and Non-Objections” (AS.26 – Keberatan dan Non Keberatan).
5. Select the subcategory: “AS.26-03 Application for Reduction or Waiver of Administrative Penalties (Article 36(1)(a) UU KUP)”.
6. Click “Save”.
7. Open the “Case Workflow” (Alur Kasus) menu, then select the relevant case.
8. Click the magnifying glass icon and choose the specific tax assessment notice that is the subject of your application.

Important Note: While Coretax streamlines the submission process digitally, taxpayers must ensure that all supporting data and documentation strictly align with the application requirements. Unsubstantiated claims or mismatched documentation are primary grounds for application rejection. If rejected, the administrative penalties stated in the STP or SKP remain a binding tax debt that must be settled in full in accordance with applicable laws.

Conclusion

The penalty reduction and waiver provisions under PMK 118/2024 provide crucial recourse for taxpayers facing administrative fines.

While the Coretax system makes submitting applications far more efficient, eligibility compliance and thorough supporting documentation remain critical to a successful outcome. For business owners, leveraging this relief mechanism—when fully compliant with the law—can serve as an effective strategy to manage tax obligations and safeguard business cash flow.