Avoid Costly Sanctions: 2025 Guide to Annual Report for Foreign Company in Indonesia

Annual Report for Foreign Company in Indonesia: Stay Compliant in 2025

Running a foreign-owned company in Indonesia comes with exciting business potential, but it also requires strict compliance with local regulations—especially when it comes to annual reporting obligations. Failing to submit a complete and timely annual report for foreign company status can lead to administrative sanctions, tax penalties, and even restrictions on business operations.

In this comprehensive guide, we break down the key elements of an annual report for foreign company in Indonesia, particularly the compliance requirements set by BKPM (Investment Coordinating Board) and the Directorate General of Taxes. Whether you’ve just established a PT PMA (foreign investment company) or have been operating for years, staying up to date with these annual requirements is essential for long-term success.

Understanding the Basics of Annual Report for Foreign Company

An annual report for foreign company is a formal declaration of a company’s financial status, operational activities, investment realization, and compliance level. It is submitted to multiple government agencies, including BKPM, the Directorate General of Taxes, and sometimes the Ministry of Law and Human Rights.

For PT PMAs (foreign-owned limited liability companies), the stakes are higher. As they operate under foreign investment, these entities are closely monitored to ensure they align with national development goals.

The annual report for foreign company is not only about fulfilling bureaucratic requirements—it reflects your company’s legitimacy, performance, and intent to operate transparently within Indonesia’s regulatory framework.

Who Must Submit the Annual Report?

All PT PMA companies must prepare and file the annual report for foreign company on a recurring basis. This includes:

• Newly established foreign-owned companies
• Dormant PT PMAs (even if no income was generated)
• Actively operating businesses across all sectors

Here are the major components:

• LKPM (Investment Activity Report) via the BKPM system
• Annual Tax Return (SPT Tahunan) to the tax office
• Financial Statements (audited or unaudited)
• OSS system updates for licensing and company changes
• BPJS Ketenagakerjaan & BPJS Kesehatan reports
• Legal compliance reports (e.g., to Ministry of Law and Human Rights if applicable)

Every submission makes up a part of the full annual report for foreign company, and missing one component can result in partial non-compliance.

Key Components of the Annual Report for Foreign Company

LKPM – Investment Activity Report

This is the most critical part of the annual report for foreign company, submitted through the OSS-RBA platform. Depending on your business classification (large, medium, small), reporting is done quarterly or annually. The LKPM includes:

• Capital realization (foreign and domestic)
• Human resource details (national and expatriate)
• Production capacity and utilization
• Business activities
• Issues and progress updates
  
  

A complete and consistent LKPM ensures that BKPM views your PT PMA as operationally healthy and investment-worthy.

Annual Tax Return (SPT Tahunan)

This is the backbone of your annual report for foreign company from a fiscal perspective. It must be filed by April 30 each year and includes:

• Income statements
• Balance sheets
• Fixed asset depreciation
• Tax payment calculations
• Transfer pricing documentation (for related-party transactions)

Incorrect or late filing can trigger tax audits and financial penalties.

Financial Statement Audit

Foreign-owned companies that meet thresholds in assets or revenue must submit audited financials. This enhances the credibility of your annual report for foreign company, especially when applying for credit or expansion licenses.

OSS (Online Single Submission) Portal Updates

Any change in your business address, line of business, shareholders, or board of directors must be promptly updated in the OSS system. If the OSS shows outdated data, your annual report for foreign company could be flagged as inconsistent.

Deadlines to Watch

Missing reporting deadlines is one of the main causes of compliance issues for foreign entities. Key dates include:

• LKPM Reports: Quarterly or Annually
• SPT Annual Tax Return: April 30
• Audited Financials: Around March–April
• OSS Updates: As changes occur

Plan early to meet these deadlines and maintain a complete annual report for foreign company.

Sanctions for Non-Compliance

Failing to submit your annual report for foreign company or providing inaccurate information can lead to:

• BKPM sanctions: warning letters, license suspension
• Tax Office penalties: fines, audits, interest on underpayment
• Visa and work permit delays
• Difficulty renewing or acquiring new business licenses

In serious cases, it can even jeopardize your legal right to operate in Indonesia.

Digital Transformation: OSS-RBA and LKPM Portal

Since 2021, all annual report for foreign company submissions have been streamlined through the OSS-RBA platform. The LKPM online portal enables the government to monitor the health of investment performance in real-time.

To stay compliant, foreign companies must designate staff or consultants who understand how to navigate and update the portal on time.

Tips for New Foreign Companies

If your PT PMA was incorporated recently, your first annual report for foreign company is due within 12 months of registration—even if you’ve had no revenue yet.

Failing to submit the first LKPM often leads to being marked “non-operational,” affecting future applications or compliance scores.

Start collecting these from day one:

• Employee contracts
• Capital inflow bank statements
• Lease agreements
• Vendor and partner contracts

Hiring a Compliance Consultant

Submitting an annual report for foreign company isn’t just about ticking boxes. It requires:

• Technical tax knowledge
• Financial reporting accuracy
• Understanding legal obligations
• Familiarity with digital platforms like OSS and LKPM

That’s why many companies choose to work with compliance experts like Synergy Pro. We offer:

• Full LKPM support
• Tax filing assistance
• Transfer pricing compliance
• Audited financial statement coordination
• BPJS reporting
• OSS portal maintenance

Professional support ensures every component of your annual report for foreign company is handled correctly, giving you peace of mind.

Common Mistakes and How to Avoid Them

Here are pitfalls that could hurt your annual report for foreign company:

• Incomplete LKPM data – Double-check HR, capital use, and timelines
• Overdue tax payments – Always submit on time to avoid automatic fines
• Missing attachments – Ensure schedules and footnotes are complete
• Failure to update OSS – Reflect all shareholder and structural changes
• Unreported related-party transactions – Be transparent to avoid suspicion

By proactively managing these issues, your annual report for foreign company will meet all regulatory expectations.

Directors and Legal Responsibility

Even if your company appoints a local accountant or consultant, the foreign directors and shareholders remain legally responsible for the accuracy of the annual report for foreign company.

This legal liability makes it even more important to understand what’s being submitted and to keep detailed documentation.

Preparing for 2025: What’s New?

Indonesia’s reporting systems are becoming smarter, and the government is integrating:

• Real-time invoice verification (e-Faktur)
• Cross-checking OSS vs. tax filings
• AI-triggered audit alerts
  
  

This means your annual report for foreign company in 2025 must be even more accurate and timely.

Start gathering:

• Payroll summaries
• VAT reports
• Capital increase documents
• Transfer pricing reports
• Environmental reports (if in manufacturing, mining, or tourism)

Being proactive today can save months of stress later.

Conclusion

Filing an annual report for foreign company in Indonesia may seem complex, but it’s a vital step in keeping your business safe and respected. With proper planning, professional support, and updated systems, you can comply with BKPM, tax, and OSS obligations while focusing on growing your business.

Take your reporting seriously—it’s more than paperwork; it’s a long-term investment in your company’s reputation and operational continuity in Indonesia.