Tax Treatment on the Amortization Expenses of Goodwill Arising from Acquisition as Deductible Expenses to Gross Income in the Calculation of Taxable Income

DOI

10.2991/iac-17.2018.18How to use a DOI?

Keywords

Amortization; Goodwill; Acquisition; Deductible Expenses; Income Tax

Abstract

Tax audit by the Directorate General of Taxation (DJP) on PT A for several years has revealed legal uncertainty on the amortization expenses of goodwill of PT A for tax purpose. Such uncertainty is reflected in a number of Tax audit result Assessment Letters revealing inconsistent corrections on the amortization expenses of goodwill of PT A. The argumentations used by the DJP in revealing such corrections also seem contradictory to the applicable accounting and taxation provisions. With regard to it, this research is aimed at analyzing the argumentation used by the DJP in applying tax treatment on the amortization expenses of goodwill arising from acquisition if tested using the applicable accounting and taxation provisions. In addition, this research is also aimed at analyzing tax treatment on the amortization expenses of goodwill of PT A applied by DJP if seen from the legal certainty principle. The approach used in this research is qualitative approach. The data collecting techniques used are literature study and field study through in-depth interviews with stakeholders as key informants. Based on existing findings and discussions, the argumentations used by the DJP in applying tax treatment on the amortization expenses of goodwill of PT A had not been in accordance with the applicable accounting and taxation provisions. In addition, tax treatment on the amortization expenses of goodwill of PT A applied by the DJP also had not entirely fulfilled the legal certainty principle.

Copyright

© 2018, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Alfian Dovi Pradana
AU  - Ning Rahayu
PY  - 2017/08
DA  - 2017/08
TI  - Tax Treatment on the Amortization Expenses of Goodwill Arising from Acquisition as Deductible Expenses to Gross Income in the Calculation of Taxable Income
BT  - Proceedings of the 6th International Accounting Conference (IAC 2017)
PB  - Atlantis Press
SP  - 99
EP  - 103
SN  - 2352-5428
UR  - https://doi.org/10.2991/iac-17.2018.18
DO  - 10.2991/iac-17.2018.18
ID  - Pradana2017/08
ER  -