The Importance of Paying Land and Building Tax (PBB) Before Buying or Selling a House
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Before a property changes ownership, there’s one crucial detail that’s often overlooked — the Land and Building Tax (PBB).
This tax isn’t just a yearly obligation; it’s also a legal requirement that must be settled before the sale and purchase process can be officially handled by a Notary or PPAT.
What is PBB?
Land and Building Tax (PBB) is a government tax imposed on the ownership, control, or use of land and/or buildings. It must be paid annually by the property owner and serves as proof of legal and fiscal responsibility for the property.
The Role of the Notary/PPAT in Checking PBB
Before a Sale and Purchase Deed (AJB) can be issued, the Notary or PPAT will verify whether the property has any outstanding PBB payments.
If there are unpaid taxes, the transaction process will be put on hold until all dues are cleared. This ensures that the buyer receives a property free of any prior tax obligations.
Why Paying PBB Matters
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Ensures a smooth transaction – Without proof of payment, the notary cannot proceed with the AJB.
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Protects the buyer – The buyer won’t inherit unpaid taxes from the previous owner.
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Avoids penalties – Late payments incur a 2% monthly fine, up to a maximum of 24 months, as stated in Law No. 28 of 2009 on Regional Taxes and Levies.
Conclusion
Paying the Land and Building Tax (PBB) before selling a house isn’t just a legal formality — it’s an act of good faith and responsibility as a property owner.
For buyers, always request the latest proof of PBB payment to ensure that the ownership transfer and deed signing process run safely and smoothly.
Disclaimer: This article is intended for informational and educational purposes only. It should not be considered legal advice. For specific guidance, please consult a qualified legal professional.
