7 Differences between CV and PT that you should know

As a business person, it is natural that you are confused whether you want to make a CV or PT as the legal status of your business. Well, so you don't get confused, you should check the difference between CV and PT before deciding.

In short, PT is a Limited Liability Company, while CV is a Limited Liability Company or Limited Liability Company Commanditaire Vennootschap. Not only abbreviations, CV and PT have many differences, from a legal and operational perspective. Read on for this article to find the answer.

Company Form

The first difference is from the form of the company. PT is a business in the form of a legal entity, while CV is a non-legal business entity.

PT has special rules in Law Number 40 of 2007 concerning Limited Liability Companies. Meanwhile, the CV is only "hit a ride" regulated in the rules that discuss the Firm in the Book of Trade Law (KUHD) Articles 19-25.

Because the legal status is different, the registration and ratification are also different. PT must be registered and ratified by the Ministry of Law and Human Rights (Kemenkumham) as a legal entity. Meanwhile, a CV only needs to be registered with the Kemenkumham Business Entity Administration System.

Registration Process and Company Name

PT is required to include the phrase Limited Liability Company or PT abbreviation in its name and the name cannot be the same as other companies. Unlike the case with a CV, the founder does not have to include a CV and there is a possibility that the names of CVs are similar to one another.

In the process, PT tends to take longer because it has to follow a fairly long procedure from the Ministry of Law and Human Rights. While the CV does not require special approval from the Ministry of Law and Human Rights, so the process is quite short.

Minimum Capital

To establish a CV, founders are not subject to mandatory rules regarding minimum capital. Meanwhile, according to Law Number 40 of 2007, the establishment of a PT must be accompanied by an authorized capital of at least Rp. 50 million, with 25 percent or 12,5 million of this amount being allocated as company assets. However, the Job Creation Law of 2020 provides flexibility for founders to determine the minimum capital for the establishment of PT.

Founder and Ownership Status

According to the rules, CV is established by at least two people who will act as active partners and passive partners and both must be Indonesian citizens. A CV can be established by a husband and wife, as long as they have previously made a separation agreement.

On the other hand, the establishment of a PT also requires at least two people who own shares, but it is allowed that one of them is a foreigner. If both founders are foreigners, it means that the company is called a Foreign-Owned Company (PMA) so it must follow the rules related to PMA that apply.

However, according to the Job Creation Law of 2020, a minimum of 2 founders in PT does not apply to PT whose shares are owned by the state, BUMN, BUMD, BUMDes, companies that manage stock exchanges, clearing and guarantee institutions, depository and settlement institutions, and other institutions. according to the Capital Market Law, or a company whose founder is an MSME.

Management

In CV, you certainly know active allies and passive allies. The management of the company itself is the full responsibility of the active partner and the passive partner may not interfere.

Meanwhile, the management of PT is carried out by the board of directors determined through the General Meeting of Shareholders (GMS). Only shareholders who are appointed as directors are authorized to manage PT, others do not.

Company Goal

Companies in the form of CV have a limited purpose in certain fields compared to PT. These fields include trade, development, industry, workshops, agriculture, printing, and services.

Meanwhile, a PT is allowed to run a business in accordance with the purpose of its establishment, and of course it is wider than what has been stated in the CV. For example, such as non-facility PT in the fields of trade, workshops, construction, services, and the like. Or special business PT like forwarding, press companies, tourism, loading and unloading companies, etc.

Tax Collection

The last difference between CV and PT is the difference in taxation. In general, both PT and CV are required to pay taxes from employee salaries, allowances, and other payments. The same also applies if the PT or CV leases land/building tax objects.

However, the taxation of PT and CV is different in terms of profit. In a CV, personal wealth is counted as a company asset that also generates profits. Therefore, the object of tax in CV is operating profit.

Meanwhile, in PT, the company's assets are in shares which are divided into each shareholder who will later benefit in the form of dividends. So, the object of tax in PT is dividend which is also a tax object.

Those were 7 differences between CV and PT. In addition to showing comparisons, you can find out the advantages and disadvantages between CV and PT from this article. Later, this can be a consideration to determine which form of company is more suitable for your business. May be useful!

Image source header: iStockPhoto

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