In 2025, the Government will provide tax incentives in the form of government covered value added tax on the delivery of landed houses and apartment units in the 2025 fiscal year that meet the requirements in accordance with the Minister of Finance Regulation number 60 of 2025. Detached houses that meet the requirements for government covered value added tax are buildings in the form of residential houses, both multi-story and single-story, including shop or office buildings. Meanwhile, based on article 2 paragraphs 2 and 3, a landed house is a building in the form of a residential house or row house, whether multi-story or single-story, including residential buildings that are partly used as shops or offices, and a housing unit is a housing unit that functions as a place of residence. The government covered value added tax applies from the signing of the deed of sale and purchase or the deed of sale and purchase agreement in the presence of a notary from July 1, 2025, to December 31, 2025. Based on article 4 paragraph 1, landed houses or apartment buildings have a maximum selling price of IDR 5,000,000,000 (five billion rupiah) and are in new condition and ready for occupancy. If a landed house or apartment unit has a selling price of more than of IDR 5,000,000,000, it is not eligible for the government covered VAT facility. A new landed house or apartment unit is defined as a house that is handed over for the first time by a taxable entrepreneur who builds landed houses or apartments, has never been transferred, and has been assigned a house identification code. The government provides a 100% VAT exemption on the VAT payable on the sales price up to of IDR 2,000,000,000 (two billion rupiah) for landed houses or apartment units with a sale price up to of IDR 5,000,000,000 (five billion rupiah) in accordance with article 7(1) and is applicable from July 2025 to December 2025.
Based on article 8, taxable entrepreneurs who sell landed houses or apartment units are required to issue tax invoices in accordance with the provisions of laws and regulations and report the realization of VAT covered by the government. The invoice code used for the delivery of landed houses and apartment units is created by issuing a tax invoice with transaction code and the tax invoice treatment is as follows:
- Tax invoice with code 07 (zero seven) for the portion of the selling price up to of IDR 2,000,000,000 (two billion rupiah) for which the VAT payable is covered by the government and;
- Tax invoices with code 04 (zero four) for sales prices exceeding of IDR2,000,000,000 (two billion rupiah), where the VAT payable is not covered by the government.
Example of government covered VAT calculation on the sale of a landed house if the price exceeds IDR 3,000,000,000
- Tax invoice code 07 for government covered value added tax of IDR 220,000,000 (IDR 2,000,000,000 x 11/12 x 12%)
- Tax invoice code 04 for non-government covered value added tax of IDR 110,000,000 (IDR 1,000,000,000 x 11/12 x 12%)
In addition, tax invoices for government covered value added tax must also include the statement bahasa Indonesia which means “PPN DITANGGUNG PEMERINTAH EKSEKUSI PMK NOMOR …TAHUN 2025”. If this statement is not yet available in the application, the taxpayer may include the same statement in the reference column of the tax invoice.
By Olina Rizki Arizal – Partner
TBrights is a tax consultant in Indonesia that currently serves as an Integrated Business Service in Indonesia, providing comprehensive taxation and business services.
Reference:
- The Minister of Finance Regulation on Additional Incentive For Value Added Tax on the Delivery of Landed House and Apartment Unit Covered by the Government in the 2025 Fiscal Year
