Income Tax 21 on Regular Income
Regular income for permanent employees is income for permanent employees
in the form of salaries and wages, all kinds of benefits, and rewards under any
name that are given periodically based on conditions set by the employer,
including overtime pay.
1) Gross income and monthly net income
- a) To calculate Income Tax 21 on the income of permanent employees, first look for all gross
income received or earned during a month, which includes all salaries, all
types of benefits, and other regular payments, including overtime pay and
similar payments.
- b) For companies enrolled in
the Social Security program, the work accident insurance premium, the
death insurance premium, and the accident maintenance insurance premium
paid by the employer constitute income for employees. The same provisions
apply to health insurance premiums, work accident insurance, life
insurance, endowment insurance, and scholarship insurance paid by
employers for employees to other insurance companies. In calculating PPh
21, the premium is combined with the gross income paid by the employer to
the employee.
- c) Next, the total monthly
net income is calculated by subtracting the monthly gross income from
office fees, pension contributions, Old Age Security contributions, and
Old Age Allowance contributions paid by the employee himself through the
employer to the Pension Fund, which has been approved by the Minister of
Finance, or to the Social Security Program Agency.
The amount of office fees that can be deducted from gross income for
calculating income tax deductions for permanent employees is set at 5% (five
percent of gross income, a maximum of Rp. 6,000,000 (six million rupiah) a year
or Rp. 500,000 (five hundred thousand rupiah) a month .
Pension contributions or old age benefits, namely contributions related
to salaries paid by employees to pension funds whose establishment has been
approved by the Minister of Finance, or the organizing body for old age
benefits, which is equivalent to a pension fund whose establishment has been
approved by the Minister of Finance,
The amount of deductible pension costs and gross income for the
calculation of the income tax deduction for pensioners is set at 5% (five
percent) and gross income, a maximum of Rp. 2,400,000 (two million, four
hundred thousand rupiah) a year or Rp. 200,000 (two hundred thousand rupiah) a
month.
Non-taxable income
calculated based on the conditions at the beginning of the year
WP = 54,000,000
Marital Status = 4,500,000
Working wife = 54,000,000
Max. 3 people = 4,500,000
The rates of Article 17 of the Income Tax Law are as follows:
Tariff Taxable Income Layer
Up to IDR 50,000,000 = 5%
Above IDR 50,000,000 - IDR 250,000,000 = 15%
Above IDR 250,000,000 - IDR 500,000,000 = 25%
Above IDR 500,000,000 = 30%
Income Tax 21 for Non-Permanent Employees
For income received or earned by non-permanent employees or freelance
workers in the form of daily wages, weekly wages, unit wages, piece wages, and
daily allowances, as long as the income is not paid monthly, the first layer
rate as referred to in Article 17 paragraph (1) letter a UU PPh PMK No. 102/PMK
10/2016 10 applies to:
- total daily gross income
that exceeds IDR 450,000 (four hundred and five thousand rupiah).
- The total gross income minus
the actual PTKP in terms of the total cumulative income in 1 (one)
calendar month exceeds IDR 4,500,000 (four million five hundred rupiah).
In the event that the total cumulative income in one calendar month
exceeds IDR 10,200,000.00 (ten million two hundred thousand rupiah). PPh
Article 21 is calculated by applying the rate of Article 17 paragraph (1)
letter a of the Income Tax Law to the annual PhKP amount. For non-permanent
employees or freelance workers, apprentices, and prospective employees who
receive wages paid monthly, income tax 21 is calculated by setting the rate of
Article 17 paragraph (1) letter a of the Income Tax Law on the amount of annualized
gross wages after deducting PTKP, and the amount of income tax 21 that must be
deducted is the amount of PPh article 21 as a result of the calculation.
Income Tax 21 for Non-Employee
The applicable rate for calculating PPh Article 21 for non-employees
based on Article 17 paragraph (1) in the PPh Law is applied to 50% (fifty
percent) of the total gross income for each non-continuous payment of
compensation to non-employees. Continuing benefits to non-employees are
compensation to non-employees that is paid or payable more than once in a
calendar year in connection with work, services, or activities.
Furthermore, the rates based on Article 17 paragraph (1) letter a UU PPh
are applied to the cumulative amount of
- PhKP of 50% (fifty percent)
of total gross income minus monthly PTKP received or obtained by
non-employees as long as the person concerned already has an NPWP and only
earns income from a working relationship with one Article 21 Income Tax
Withholder and does not receive other income.
To be able to get a reduction in the form of PTKP, non-employee income
recipients must submit a photocopy of their NPWP card, and married women must
submit a photocopy of their husband's NPWP card as well as a photocopy of a
marriage certificate and family card.
- 50% (fifty percent of total
gross income for each payment of compensation to non-employees on an
ongoing basis who do not meet the conditions above)
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