F & C

Introduction

Running a business isn’t just about sales, growth, and innovation—it’s also about staying compliant with legal requirements. Many companies overlook annual compliance, which can lead to fines, penalties, or even suspension of business licenses. To keep your company on the right track, it’s important to understand the key filings, reports, and corporate housekeeping practices you need to complete every year.

This Annual Compliance Guide will walk you through the essentials to keep your business legally sound.

1. Annual General Meeting (AGM)

Most companies are required to hold an Annual General Meeting of Shareholders to approve:

Financial statements
Dividend distribution (if applicable)
Appointment or reappointment of directors and commissioners
Corporate governance matters

👉 Keep minutes of the meeting as official records for future audits or inspections.

2. Annual Financial Report Submission

Companies must prepare and submit audited or unaudited financial statements depending on their size and industry. These reports:

Provide transparency to shareholders
Ensure tax compliance
Serve as supporting documents for loan or investor applications

3. Annual Tax Filings

Every business must file annual tax returns, including:

Corporate Income Tax Return (CIT): Reporting revenue, expenses, and net profit.
Employee Income Tax (PPh 21): Annual reconciliation of payroll taxes withheld.
Value-Added Tax (VAT): For businesses registered as PKP (VAT-registered entrepreneurs).

Failure to file on time can result in administrative sanctions and penalties.

4. Business License Renewal

Certain licenses, especially operational permits, may require annual renewal or reporting to stay valid. This includes:

Industry-specific licenses (e.g., construction, healthcare, finance)
OSS (Online Single Submission) reports for business activities

5. BPJS Compliance (Social Security & Health Insurance)

Companies must ensure they:

Continue paying monthly contributions for BPJS Ketenagakerjaan (employment benefits) and BPJS Kesehatan (healthcare).
Submit employee data updates annually.

6. Updating Company Data

It’s crucial to update company records whenever there are changes in:

Shareholding structure
Directors and commissioners
Business address or activities
Articles of Association

👉 These updates should be reported to the Ministry of Law and Human Rights (MOLHR) and sometimes require a notarial deed.

7. Corporate Housekeeping Practices

Beyond filings and reports, good governance keeps your business legally sound:

Maintain updated statutory registers (shareholders, directors, commissioners).
Keep proper board and shareholder meeting minutes.
Ensure contracts, permits, and employment agreements are valid and up to date.

8. Penalties for Non-Compliance

Ignoring annual compliance can lead to:

Monetary fines
Suspension of business licenses
Legal disputes with shareholders or employees
Damage to business reputation

Conclusion

Annual compliance is not just a legal formality—it’s the backbone of a trustworthy and sustainable business. By keeping up with corporate filings, tax returns, and company housekeeping, you’ll avoid penalties and build stronger confidence among stakeholders, partners, and regulators.

If compliance feels overwhelming, consider engaging professional consultants to manage annual filings on your behalf. This way, you can focus on growing your business while staying legally secure.