If you are doing business in Indonesia or planning a business investment, understanding LKPM (Investment Activity Report) is essential. Many businesses struggle with correct and timely LKPM reporting. Mistakes can lead to LKPM penalties and sanctions or affect your business license.
In this article, we will highlight five common LKPM mistakes to avoid and practical tips for better LKPM compliance in Indonesia.
The LKPM report helps BKPM (Indonesia's Investment Board) track the progress of business operations and investment realization. The government ensures that your business investment aligns with the approved plans through these reports.
Here is why it matters:
Missing or incorrect reports can lead to issues, including delays or penalties. To protect your business and reputation, submit your investment report in Indonesia correctly and on time.
Read more: A compliance guide about the LKPM Report for your business
This report is mandatory for many businesses in Indonesia, especially those with an investment license from the OSS (Online Single Submission) system.
Any company with a business license issued through OSS must submit quarterly investment reports in Indonesia, even if there is no investment activity yet. This applies to:
Remember, late submission can delay your next license approval, leading to penalties and sanctions. Ensuring timely submissions is crucial for maintaining business continuity in Indonesia.
Many businesses make avoidable mistakes when submitting their investment reports. These errors can lead to rejection, delays, or even problems with your business license, significantly impacting your operations in Indonesia.
Here are the five most common mistakes to avoid:
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Some companies confuse the reporting period. Make sure your quarterly investment report covers the correct dates. Double-check your LKPM OSS account to confirm the schedule.
Incorrect investment values or operational costs are big red flags for BKPM reporting. Always verify your numbers before submitting them, especially for foreign capital and asset reporting.
Even if your business has yet to start operations, you still need to submit an investment report. Just mark the report as "no activity." Skipping this step can cause compliance issues.
Some businesses use a personal OSS account instead of the company account. This mistake can prevent your LKPM online submission from being properly recorded.
Submitting through OSS can be delayed, leading to warnings or sanctions. Set reminders for your team and submit ahead of the deadline.
To stay compliant and avoid issues with your online LKPM submission, here are some key points every business should keep in mind:
Ensure your OSS business license is active and matches your business activities.
Keep your report figures consistent with your internal financial records. Questions can be raised during audits or inspections if the numbers do not match.
Stick to the deadlines—most businesses have quarterly ones. Please set up reminders so you do not miss them. Timely reporting is crucial to avoid penalties and maintain good standing with the authorities.
Any changes in your business activities or address should be updated in the OSS system. Your company registration details must always match the OSS records, ensuring accurate and up-to-date information for smooth operations.
Working with a trusted local agency can help streamline your LKPM reporting process. They understand the latest BKPM requirements, manage document submissions, and ensure you never miss a deadline. This is especially useful if you are new to business in Indonesia or lack in-house expertise.
Read more:
LKPM reporting is essential for keeping your business legal and running smoothly in Indonesia. Nevertheless, it can be tricky, especially if you are new to the system or do not have local support.
Ascentium Indonesia offers complete LKPM reporting services to ensure timely report submission without errors. Our expert teams know the rules and care for the details, so you do not have to worry.
With Ascentium Indonesia, you get: