Have you made a digital gold investment, but are still confused about how to treat the tax? Don’t be confused, let’s look at the following information!
- Due to the ease of technology, digitization has penetrated almost all types of investment, including gold.
- Digital investment returns are included in assets, so they must be reported in the Annual Tax Return.
Digital Based Investment
Changes in behavior since the pandemic era are not only limited to aspects of mobility and communication, but also to the pattern of investment activities carried out.
Consciously or not, many people from various age ranges have turned to digital-based investments. This is none other than the ease and flexibility offered today.
Through digital-based investment, all transactions can be done only by operating the mobile phone that we have.
Talking about the investment, digitalization has penetrated almost all types of investment that we know.
These investments include stocks, bonds, property, and gold which is still one of the most attractive or excellent instruments from time to time.
Things You Need to Know in Digital Investing
Currently, conversations from coffee shops to cafes have started to talk about the benefits of digital-based investments.
However, those who already have an obligation to pay taxes rarely talk about taxes from digital investment transactions to the obligation to report investment income in the Annual Income Tax Return.
According to Law Number 28 of 2007 concerning taxation, it is explained that,
Tax Return (SPT) is a letter used by the Taxpayer to report the calculation and/or payment of taxes, tax objects and/or non-tax objects, and/or assets and liabilities in accordance with the provisions of tax laws and regulations.
This Annual Income Tax Return is mandatory for those who already have a Taxpayer Identification Number (NPWP). TIN is also mandatory if a person has met the subjective and objective requirements as a Taxpayer.
Because the digital investments that we have can be said to be assets, we also need to disclose and report the existing investments in our annual tax returns as a form of participation in being obedient citizens.
In addition, this is done to see the fairness of tax calculations from income reported by taxpayers.
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Digital Gold Investment Taxation Aspects
Almost everyone agrees that gold is an investment instrument that promises multiple returns in the long term. In addition, gold is also worth ogling for those who want to multiply their wealth prospectively and with minimal risk.
Basically, both conventional and digital-based gold investments offer the same concept of profit, namely the difference between the selling and buying prices made at a certain time.
Then, is it different from the physical gold that we usually buy at a jewelry store or in a bank directly?
Of course, it’s different. Digital gold is a form of 24-carat pure gold investment with a purity percentage reaching 99.9% without the burden of storage. This digital gold is invested online through internet banking or online gold buying and selling applications.
Please note that gold investment is not just buying gold and then selling it back. Any type of fixed investment will be taxed. The difference is the percentage of tax that will be charged.
Since 2017, the purchase of gold bullion in a company or business entity is subject to Article 22 Income Tax (PPh).
The imposition of this gold tax is contained in the Regulation of the Minister of Finance (PMK) Number 34 of 2017 concerning Collection of Income Tax in Relation to Payments for Delivery of Goods and Activities in the Import Sector or Business Activities in Other Fields.
Basically, the tax burden imposed on gold only occurs once when we buy it. However, under certain conditions income tax will also be imposed when we resell ( buyback ).
For our purchasing activities, the PPh (PPh 22) imposed on the sale of gold bars is 0.45% of the selling price we agreed upon from the retail seller.
This applies to transactions on the spot or online platforms where we make gold transactions.
The gold PPh tax rate for buyers who do not have an NPWP is higher, at 0.9%. On the other hand, the tax calculation when selling gold bullion is different from when we make a purchase.
In accordance with applicable regulations, the resale of gold bullion with a nominal value of more than Rp. 10 million is subject to PPh 22 of 1.5% (for NPWP holders and 3% for non-NPWP).
After knowing the tax imposed, then how about reporting it? To find out, let‘s listen to the following audiobook.
Taxation Tips and Tricks in Digital Gold Investment
My Financial friends, as investors, need to be careful when buying and selling gold.
As stated above, in gold investment, including digital-based investment, the resale of gold subject to income tax has a transaction limit of above IDR 10 million.
So, in doing a resale ( buyback ) we can divide it into smaller fractions to minimize the potential for tax cuts on our gold investment.
However, we also need to compare the price of gold when we buy it. This is because the purchase price of gold in small fractions is much more expensive than gold with larger denominations.
In conclusion, the important things we must understand are:
- Understand the investment criteria that we will run, including aspects of taxation on purchase taxes that we need to bear.
- The treatment of the investment reporting in the SPT.
- The potential income tax may be imposed in terms of realized profits in the future.
If you are still confused in calculating and reporting digital gold taxes, you can discuss with my Financial Planner to get the answer.