NPWP is the Mandatory Taxpayer Identification Card, Know its Benefits and Types

Kapanlagi.com - Paying taxes is one of the obligations for every citizen. This is because every tax payment will also be allocated for public purposes. Every citizen who is classified as a taxpayer has a Taxpayer Identification Number (NPWP). In general, NPWP is an identification card for taxpayers.

NPWP stands for Taxpayer Identification Number. NPWP is like a special identification card used for tax transactions. In practice, NPWP is issued and managed by a government institution called the Directorate General of Taxes (DJP).

NPWP is indeed like an identification card, but of course, NPWP cannot be equated with other identification cards. It turns out that NPWP has several special functions and consists of several types. To find out more, please read the following summary compiled from various sources.

1. What is NPWP?

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As mentioned earlier, NPWP stands for Nomor Pokok Wajib Pajak (Taxpayer Identification Number). NPWP is used as an identity for individuals when making tax payments. As the name suggests, NPWP contains a special number consisting of 15 digits as the taxpayer's identity.

The special number on NPWP not only functions as a code or identity. The number also serves to ensure the taxpayer's data. With this number, taxpayer data will be more secure and protected from the possibility of being exchanged.

The special number on NPWP consists of 15 digits with the following details: the first 9 digits are the taxpayer's identity, then the next 3 digits are a unique code issued by the Tax Service Office (KPP) where the taxpayer registers, while the last 3 digits represent the taxpayer's status.

2. The Function of NPWP

The NPWP card can indeed function as an identity card, especially when conducting tax transactions. However, the function of NPWP is not only that. NPWP still has several other functions for taxpayers. The functions of NPWP are as follows.

1. One of the functions of NPWP is to provide tax refund to taxpayers. Usually, the refund is given because the taxpayer has paid taxes in excess. To process the tax refund, taxpayers must show their NPWP card as a requirement.

2. The next function of NPWP is as a special code used when conducting tax transactions. As mentioned earlier, this special code is useful to ensure the security of taxpayer data, so that it is not exchanged.

3. NPWP is one of the important documents for citizens. NPWP has many uses, one of which is a main requirement for applying for credit at a bank. In addition, NPWP is also a requirement for managing a Trading Business License (SIUP).

4. Not many people know that a taxpayer who holds an NPWP card will be subject to lower tax rates compared to those who are not registered and do not have an NPWP. In fact, the difference in tax deductions that must be paid by NPWP cardholders and non-NPWP cardholders is said to reach 20%.

3. Party Entitled to Have NPWP

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Like any other identification card, NPWP must be owned by eligible individuals, in this case taxpayers. In addition, there are also several parties that are required to make NPWP. As quoted from klikpajak.id, the following are the parties entitled to register to make NPWP.

1. Individual Person
The meaning of an individual person is that every individual can choose and register themselves to obtain Personal NPWP.

2. Married Women
In this case, it refers to women who live separately based on a court decision. Meanwhile, there is a written will from the agreement of income and asset separation and choose to handle taxes separately from their spouse even though there is no agreement.

3. Profit-Oriented Entity or Company
Like individuals, profit-oriented companies or entities are also obligated to fulfill payment, deduction, and collection tax obligations.

4. Nonprofit Entity or Company
Apart from profit-oriented entities, nonprofit companies and entities are also required to fulfill tax deduction and collection obligations.

5. Treasurer
The treasurer is the party appointed in terms of tax deduction and collection.

4. Types of NPWP

Broadly speaking, NPWP is divided into two types, namely Personal NPWP and Company NPWP. As the name suggests, Personal NPWP is given to every individual who has income in Indonesia. Meanwhile, Company NPWP is a type of NPWP given to companies or business entities that earn income in Indonesia.

That is one of the reasons why NPWP is considered an important document. Especially when engaging in economic and taxation-related activities, such as applying for a Trading Business License (SIUP). It is not uncommon for NPWP to also be one of the requirements for job applicants.

Those are some of the reviews regarding NPWP as a taxpayer's identity, along with its benefits and types. Hopefully, it is useful and can increase knowledge.

(kpl/psp)