The Directorate General of Taxes (DGT) can take active actions against Taxpayers to collect unpaid Tax Payables.
Tax collection refers to a series of actions taken to make sure that Tax Bearers pay off their Tax Payables and the tax collection expenses.
Tax Bearer refers to the individual or entity responsible for paying your tax.
Rights of Taxpayer in Tax Collection
Taxpayers have the following rights:
- You can apply for Tax Payable installment and deferment;
- You can apply for administrative penalty reduction or annulment;
- On Notices of Tax Underpayment Assessment/Notices of Additional Tax Underpayment Assessment from Fiscal Year 2008 to date that are unapproved by you at the audit closing conference, the tax collection will be deferred;
- You can file a lawsuit against the enforcement of Distress Warrant, Confiscation Warrant, Notice of Auction, or Travel Ban Decision in the Context of Tax Collection to a Tax Court;
- You can file a lawsuit against the enforcement of imprisonment for debt to a District Court;
- You can file an objection to confiscated objects.
Obligations of Taxpayer in Tax Collection
Taxpayers have the following obligations:
- You are required to pay Tax Payables prior to their due dates;
- You are required to meet your tax payment installment/deferment commitments;
- You are required to be cooperative during tax collection;
- You are prohibited from violating the Tax Collection with Distress Warrant Law during Tax Collection resulting in a criminal act, such as transferring, hiding, disposing, transferring title to confiscated goods.
Statute of Limitations of Tax Collection
The DGT has a 5 (five)-year period to collect tax, including interest, increases, and tax collection expenses, from you following the issuance of the basis for tax collection.
However, it can be deferred/extended to more than 5 (five) years if:
- A Distress Warrant is issued;
- You acknowledge your Tax Payables, whether directly or indirectly, for example when you apply for tax payment installment/deferment;
- A Notice of Tax Underpayment Assessment or Notice of Additional Tax Underpayment Assessment is issued because you commit a tax or other criminal acts incurring state losses;
A tax crime investigation is conducted.