Year-End Closing 2026: 8 Checks to Make Before 31 December for a Smooth Annual Tax Return

Closing the books is more than locking a period in your accounting software. Clean financial statements as of 31 December 2026 are the basis of the annual tax return you will file in Coretax next year. Errors found now are far cheaper to fix than after the return is filed or after a letter arrives from the tax office. Here is a checklist you can start working through in November.

This checklist is for owners of MSMEs, CVs, and PTs, whether you keep the books yourself or with staff. If your business is VAT-registered (PKP) or has employees, the VAT and PPh 21 items matter most, because both are also reported every month.

Why start now?

Under the KUP Law, the annual return for individuals is due no later than 3 months after the end of the tax year, and for companies no later than 4 months. For tax year 2026, that means around 31 March 2027 and 30 April 2027. Before that, the December monthly return must be filed within 20 days after the end of the tax period.

That may sound like plenty of time, but the data you need (stock, bank balances, invoices, withholding slips) is easiest to gather before the year turns.

1. Reconcile cash and bank

Match cash and every bank account in your books to the bank statements as of 31 December. Trace unrecorded deposits or withdrawals, bank charges, and interest. Small differences left alone pile up and make the return harder to prepare.

2. Receivables and payables

Send balance confirmations to key customers and suppliers. Flag long-overdue receivables to discuss their treatment with your consultant. Make sure supplier payables, including December bills that arrive in January, are recorded in the right year.

3. Inventory count

Count the physical stock in your warehouse or store and compare it with your records. Damaged, expired, or missing goods should be recorded with supporting documents (an official report). Closing inventory directly affects cost of goods sold and profit.

4. Fixed assets and depreciation

Update your asset register: new purchases in 2026, assets sold, and assets no longer in use. Make sure depreciation runs through December, and keep the purchase invoices as evidence.

5. VAT reconciliation

For VAT-registered businesses (PKP), match output and input tax invoices in Coretax with sales and purchases in your books. Input invoices not yet credited or output invoices that were missed are best resolved before year-end.

6. December PPh 21

Under PMK 168/2023, PPh 21 withholding for December (the last tax period) does not use the Average Effective Rate (TER). The December amount is the difference between the full-year PPh 21, calculated at the Article 17(1)(a) Income Tax Law rates, and the PPh 21 already withheld under TER from January to November. Gather full-year salary, bonus, and THR data so the calculation is right. Our How to Calculate PPh 21 TER article has the full guide.

7. Withholding slips and tax credits

Collect all withholding slips, both those you issued and those you received (for example PPh 23 withheld by customers). In Coretax, slips you received can be downloaded via Portal Saya → Dokumen Saya. Complete slips become tax credits that reduce the tax payable on your annual return.

8. Tax status, arrears, and corrections

• MSME final tax status: if you use the 0.5% rate, check that you still qualify under PP 20/2026.
• Arrears: check Coretax for any unpaid SKP or STP.
• Return corrections: if a monthly return is wrong, correct it before closing. Since 1 October 2026, PER-12/PJ/2026 applies a replace scheme in Coretax: the latest corrected return becomes the basis of your tax rights and obligations, not just the difference.

Common year-end closing mistakes

• Waiting until every document is in. Work then piles up in January, alongside the December monthly return. Start with the items whose data is already ready, such as cash and bank.
• Mixing personal and business accounts. Personal transactions in the business books make reconciliation hard and risk errors in the return. Separate them, and note every unclear transaction.
• Recording year-end transactions in the wrong period. Goods shipped in late December but invoiced in January, or the reverse, must be recorded in the right period so 2026 profit is neither overstated nor understated.
• Not keeping evidence. Bank statements, invoices, stock count reports, and withholding slips should be filed neatly. These are the documents you need if the tax office asks for an explanation.
• Relying on one person. If only one staff member understands the books, the close can stall when they take year-end leave. Share the tasks and keep a clear list of responsibilities.

Checklist summary

Steps you can take

1. Schedule the close — set the stock count date and a document deadline for your team.
2. Download documents from Coretax — tax invoices and withholding slips, filed in one folder per month.
3. Reconcile in stages — start with cash and bank, then VAT, then income tax.
4. Fix errors now — don't wait for the annual return.
5. Note key dates — the December monthly return, then the individual and corporate annual returns.

Disclaimer: This article is general information as of 24 October 2026 and is not tax advice for any specific case. Tax rules may change at any time. For your situation, consult Sentary Consulting or a registered tax consultant.