Individual Income Tax Indonesia
Resident individual taxpayers who receive or earn annual income exceeding the PTKP threshold must register with the Indonesian tax office and file annual income tax returns.
A large part of individual income tax is collected through withholding by employers who are then obligated to pay this on to the Indonesian government.
Employers withhold income tax on a monthly basis from salaries and other compensation paid to the employees. In case the employee is a resident taxpayer in Indonesia, the layered rates which would apply start from 5% to 30%. If the individual is a non-resident taxpayer, the withholding tax is 20 percent of the gross amount (in case of a tax treaty the amount may vary).
CCI is up to date with the recent changes in Indonesian Tax regulations. Book a consultation with our team to learn how the Indonesian Tax laws may affect your personal income tax obligations while resident in Indonesia.
In April 2016 the Indonesian Government raised the non-taxable income by 50 percent to become Rp. 54 million (approx. USD 3,600) in a bid to strengthen people's purchasing power and encourage household consumption. There are additional deductions that can be made such as deductions for dependent children and social security payments.
CCI can assist you with information on your rights and obligations for your Personal Income Tax should you qualify as Tax resident in Indonesia. Our team of consultants are ready to assist you today.
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