Before answering questions below, make sure you have already done with these questions first to see whether you are subject to this kind of tax or not.
This progressive tax rate is levied for Indonesian resident taxpayer or expat who live in Indonesia for more than 183 days (accumulation) within 12 months (it doesn’t mean from January to December) or the one who have intention to live in Indonesia.
|Portion of income Rp 1-50 million||5%|
|portion of income between Rp 50-250 million||15%|
|portion of income between Rp 250 million-500 million||25%|
|portion over Rp 500 million||30%|
This taxable income is resulted from your gross income less any allowable tax deductions (pension cost, occupational/functional expenses, and non taxable income).
Occupational/functional expenses = 10% x gross income (max Rp500 thousand/month or in other word max Rp6.000.000/year allowed)
Supposed your taxable income is Rp 600.000.000 (gross income minus allowable deduction) within a year, your tax calculation is as follow:
5% x Rp50.000.000 = Rp2.500.000
15% x Rp200.000.000 = Rp30.000.000
25% x Rp250.000.000 = Rp62.500.000
30%xRp100.000.000 = Rp30.000.000
Therefore, your tax payable would be Rp125.000.000
Next, how to calculate taxable income?
Article 17 of Income Tax Law in Indonesia (or Pasal 17 Undang-undang Pajak Penghasilan/UU PPh in Bahasa Indonesia)
Current Income Tax Law in Indonesia = Law No 36 year 2008