Transfer Pricing Documentation · Akuntax · Since 2001
Transfer Pricing Documentation in Indonesia under PMK 172 of 2023
We prepare the Master File (Dokumen Induk) and Local File (Dokumen Lokal) for your transactions with related parties. Each is planned around the legal deadline and aligned with your annual corporate return.
Related-party prices need evidence behind them
Transfer pricing documentation in Indonesia shows that your transactions with related parties (transaksi afiliasi) follow the arm's length principle (prinsip kewajaran dan kelaziman usaha). It covers goods bought from a parent company, services charged by a regional office, royalties and intra-group loans.
The arm's length principle means pricing a transaction as independent parties would under similar conditions. If the tax office disagrees with your prices, it can correct your taxable income during an audit. Documentation prepared on time is your main evidence for the prices you used. Minister of Finance Regulation (PMK) 172 of 2023 sets out when it is required and when it is due.
For a foreign-owned company (PT PMA), these transactions can start in the first year, through capital goods, management services or loans from the parent. If you are still establishing the company, see our company setup and licensing service.
Who must prepare a Master File and Local File in Indonesia?
A company with related-party transactions needs a Master File and a Local File if it meets one of three tests in PMK 172 of 2023. The tests are prior-year gross revenue above Rp50 billion, prior-year related-party transactions above set values, or dealings with a related party in a lower-tax jurisdiction.
The transaction test has two values, both based on the previous tax year. It is met when related-party transactions in tangible goods exceed Rp20 billion, or when any other single type exceeds Rp5 billion. The jurisdiction test applies when the related party's country taxes income below the Article 17 rate of the Income Tax Law (UU PPh).
Meeting one test is enough. Even if none applies, the arm's length principle still governs your related-party prices, so basic support for those prices remains sensible. Because the tests use prior-year figures, check them again at the start of each tax year.
Master File and Local File criteria
Criterion (any one applies) | Threshold |
|---|---|
Gross revenue in the previous tax year | Above Rp50 billion |
Related-party transactions in tangible goods in the previous tax year | Above Rp20 billion |
Other related-party transactions in the previous tax year, such as services, interest or royalties | Above Rp5 billion for each type of transaction |
Related party in a jurisdiction with an income tax rate below the Article 17 rate of UU PPh | Any transaction with that party |
Source: PMK 172 of 2023, in force since 29 December 2023.
When must transfer pricing documentation be ready?
Under PMK 172 of 2023, the Master File and Local File must be available no later than 4 months after the tax year ends. You must hand them over within 1 month of a request from the Directorate General of Taxes (DGT). A summary of both is attached to the annual corporate income tax return.
For a calendar-year company, the 4-month mark falls on 30 April, the same day the annual corporate return is due. The documentation therefore has to be finished before the return is filed, because the return carries its summary. Documents prepared only after the DGT asks would miss the availability deadline.
Our USKP-certified consultants plan the work backward from your year-end. That leaves time to gather group information for the Master File and analyze your transactions for the Local File. Both are then aligned with your annual corporate income tax return.
Does your group need a Country-by-Country Report (CbCR)?
A Country-by-Country Report (Laporan per Negara, CbCR) applies to a domestic taxpayer that is the parent entity of a business group. The group's consolidated gross revenue must be at least Rp11 trillion. The report is due no later than 12 months after the end of the tax year, under PMK 172 of 2023.
What did PMK 172 of 2023 replace?
PMK 172 of 2023 was issued and took effect on 29 December 2023. It brought Indonesia's transfer pricing rules into one regulation and revoked three earlier ones. Those were PMK 213/PMK.03/2016 on documentation, PMK 49/PMK.03/2019 on the mutual agreement procedure and PMK 22/PMK.03/2020 on advance pricing agreements.
If your group's templates or internal policies still cite PMK 213/2016, they need updating. We prepare documentation against the current regulation.
What we prepare
Mapping related-party transactions
We identify your related parties and list each transaction type and value. That tells us whether the documentation obligation applies to you.
Master File (Dokumen Induk)
The group-level document describing your business group and its transfer pricing policies, prepared with information from your parent company.
Local File (Dokumen Lokal)
The company-level document covering your Indonesian entity, its related-party transactions and how their prices follow the arm's length principle.
Summary for the annual return
The summary of both documents, attached to your annual corporate income tax return as PMK 172 of 2023 requires.
Support when the DGT asks
If the DGT requests your documentation or reviews it in an audit, we help you respond within the deadlines. See our tax audit assistance.
How we work
Initial scoping on WhatsApp
Tell us your group structure, your main related-party transactions and your tax year-end.
Threshold check and data request
We confirm whether the obligation applies and list the information needed from you and your group.
Agree on scope and fees
We agree which documents we prepare, the timetable and the fee.
Drafting and review
We draft the documents, review them with your team and finalize them ahead of the deadline.
Frequently asked questions
Does every PT PMA need transfer pricing documentation?
- Not automatically. Under PMK 172 of 2023, the obligation applies only if your company meets one of three criteria. They are revenue above Rp50 billion, related-party transactions above Rp20 billion for goods or Rp5 billion per other type, or related parties in lower-tax jurisdictions. Figures refer to the previous tax year.
What if we cannot provide the documents when the DGT asks?
- The Master File and Local File must be handed over within 1 month of the request under PMK 172 of 2023. If they are missing or incomplete, your prices are harder to defend, and the tax office may make corrections based on its own analysis. Preparing them by the 4-month deadline reduces that risk.
Can we update last year's documentation instead of starting again?
- Documentation is prepared for each tax year, but much of the group-level information carries over. We review last year's files, update the facts and figures, and check whether your transactions or thresholds have changed. Where the business has changed significantly, some sections will need fresh analysis.
Can you help if our transfer prices are already under audit?
- Yes. We review the correction, compare it with your documentation and prepare your response to the audit findings. If the dispute moves to objection or appeal, our tax audit and dispute team includes two licensed Tax Court attorneys. They can represent your company before the Tax Court.
Discuss Your Company's Transfer Pricing Documentation
Tell us your group structure and main related-party transactions. We will check whether the obligation applies and what the work involves.
Discuss Transfer Pricing on WhatsAppLast reviewed: 5 October 2026 · This page provides general information based on regulations in force on the review date.
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