Document background
A Tax Funding Agreement is essential for corporate groups operating in Indonesia to effectively manage their tax obligations and internal funding arrangements. This document is typically implemented when multiple related entities need to coordinate their tax payments and establish clear mechanisms for internal tax funding transfers. It becomes particularly important in the context of Indonesian tax compliance requirements, where proper documentation and clear procedural frameworks are crucial. The agreement addresses key aspects such as payment calculations, timing, adjustments, and dispute resolution, while ensuring compliance with Indonesian tax regulations, including the KUP Law and corporate governance requirements. It's commonly used in group restructuring, establishing new subsidiaries, or formalizing existing tax funding arrangements to improve tax management efficiency and reduce compliance risks.
