Indonesia tax rates 2026

The bands apply after the non-taxable allowance: IDR 54,000,000 for a single person, IDR 58,500,000 for a married one, and IDR 4,500,000 more for each dependant up to three, so IDR 72,000,000 at most. The schedule is unchanged for 2026.

Any individual, Indonesian or foreign, becomes resident after more than 183 days in Indonesia within any 12 months, with separate stays added together and part of a day counted as a full day. Living in Indonesia makes a person resident too: a home owned or rented and usable at any time, a centre of personal and financial affairs, or a daily routine there. So does arriving during a tax year with the intention to stay, shown by a KITAP, a stay permit or visa valid for more than 183 days, a work contract or a long lease.

Residents are taxed on worldwide income, with one exception for newcomers. A foreign national who becomes resident while holding one of 25 listed specialist posts, or working as a foreign researcher, with science or technology expertise backed by a diploma, a certificate or five years' experience, is taxed only on Indonesian income for the first four tax years. Pay for work done in Indonesia counts as Indonesian income even when paid abroad, the four years run on even if the person leaves, and claiming treaty relief rules the scheme out.

The tax year is the calendar year. Employers withhold PPh 21 from pay every month, from January to November at effective average rates set by family-status category, and in December they apply the full progressive schedule and settle the difference, so the total for the year matches the brackets above.

Individuals file the annual return within three months of the year end, by 31 March, and pay any balance before filing; companies have four months. From tax year 2025 returns go through Coretax, the new system of the Directorate General of Taxes. For the 2025 return the deadline stayed 31 March 2026, but fines and interest were waived for payments and returns made by 30 April 2026.

A non-resident pays Indonesian tax only on Indonesian income, and the payer collects it as Article 26 withholding at 20% of the gross amount. It covers dividends, interest, royalties, rent, fees for services and pay for work done in Indonesia. A treaty rate replaces the 20% only when the recipient gives the payer a certificate of domicile on the Directorate General of Taxes form, and the payer reports it with the withholding slip.

An Indonesian citizen who spends more than 183 days abroad within 12 months becomes non-resident only with a permanent home abroad that is not a stopover. Family living abroad, foreign sources of income and tax residence in another country then settle the question, and from that point Indonesian income is taxed as for any other non-resident.

Dividends an Indonesian company pays to a resident individual are exempt when the money is invested in Indonesia by the end of the third month after the tax year and held there for three tax years. Shares, sukuk, time deposits, current accounts, gold and infrastructure partnerships with the state all qualify, and the investor files periodic realisation reports. Dividends that are not reinvested carry a final 10%, which the shareholder pays through Coretax.

Interest on bank deposits and savings carries a final 20%, with balances up to IDR 7,500,000 exempt, and bond interest carries a final 10%. Other gains are taxed as ordinary income, but listed shares and property fall under final taxes charged on the sale value, so the tax is due even when the seller makes a loss.

Employees belong to two schemes: BPJS Ketenagakerjaan for employment benefits and BPJS Kesehatan for health. The worker pays 2% of pay into old-age savings (JHT), 1% into the pension scheme (JP) and 1% for health. The employer pays 3.7%, 2% and 4%, plus 0.3% for death cover and 0.24% to 1.74% for work-accident cover, depending on the risk of the job.

Old-age savings have no wage ceiling. Pension contributions stop at a monthly wage cap that is reset every year, and health contributions are charged on pay up to IDR 12,000,000 a month. The old-age balance is paid out at 56, on permanent disability or job loss, or when the member leaves Indonesia for good.

Government Regulation 20 of 2026, in force from 22 April 2026, keeps the 0.5% final tax on small-business turnover up to IDR 4.8 billion a year and removes the seven-year limit for individuals. The first IDR 500,000,000 of an individual's turnover stays untaxed. Turnover is now counted across the household, including a spouse, minor children and a one-person company, and lawyers, doctors, accountants, consultants, notaries and architects cannot use the scheme.

Employees in tourism and other labour-intensive industries earning up to IDR 10,000,000 a month keep their full pay in 2026, because the government bears their PPh 21 from January to December. New rules on residency, signed in December 2025, replaced the 2009 and 2011 guidance and set out the home, centre-of-interests and intention tests now in use.

A limited four-year territorial regime exists for certain newly-arrived foreign nationals with specific expertise. It taxes only Indonesian-source income. The conditions are narrow, and it does not apply to passive investors generally.