Indonesia Income Tax Rate 2024

Indonesia income tax rate is progressively based on your salary net. Income tax helps the country to grow economic development. It provides a significant source of government revenue funding public investments in infrastructure and essential services. 

Income tax was introduced in Indonesia during the colonial era. The first income tax was implemented by the Dutch colonial government in 1904. It was initially imposed on the individuals and corporations of the Dutch East Indies, which included present-day Indonesia. Over the years, the income system has undergone various changes.

Indonesia Income Tax Rate 2024

TAXABLE INCOME (IDR*)TAX RATE (%)
Up to IDR 60 million5%
Over IDR 60 million up to IDR 250 million15%
Over IDR 250 million up to IDR 500 million25%
Over IDR 500 million up to IDR 5 billion30%
Over IDR 5 billion35%

Who is eligible to pay personal income tax in Indonesia?

Indonesia has adopted a world wide taxation system. This requires paying tax on income earned in Indonesia, as well as any income earned abroad, unless subject to a Double Tax Agreement (DTA).

If you’re an employee in Indonesia, the employer will deduct the tax from your salary depending on your income and submit it to the Government on a monthly basis. However if an individual has multiple income streams, they may be required to submit provisional tax based on income. 

To Calculate your VAT, Visit VAT Calculator

Who qualifies as a tax resident in Indonesia?

According to Indonesia law, Individuals are qualify if they meet these:

  • They live in Indonesia.
  • They reside in the country for more than 183 days over a 12-month period.
  • They are in Indonesia for part of a financial year with intention to reside there (evidenced by visas, employment contracts, etc.)

Do non-resident individuals have to pay tax?

Non-Residents individuals – those who earned in Indonesia but do not qualify for tax – are required to pay withholding tax at 20% on their income. However, where an applicable DTA is in force, it’s possible that no need to pay tax, or the total amount will be reduced. 

Also read about: Tax Refund in Indonesia for Foreigners

Submitting income tax in Indonesia

Tax year runs in Indonesia from 1st Jan to 31st Dec. All tax residents and non-residents need to complete an annual tax return for the previous tax year by 31st March. While employers take care of deducting income tax via withholdings for residents, employees are required to register as a taxpayer and file tax returns annually. Individuals can register as a taxpayer and submit all relevant forms on the Indonesia Department of Finance website. 

FAQs

As a resident, you’ll be required to pay tax on your global income. That means you need to pay tax on your outside indonesia income. Foreigners are also required to pay tax on their Indonesian income source. 

Companies with turnover no more than 4.8 billion rupiah (US$336,000) are subjected to pay 0.5% tax on total turnover.

Any foreigners who want to buy land in Indonesia are permitted to own the land under the Utilization Rights Certificate. But also note that a legal entity, not privately owned, may also hold a HM.

Henry Thomas

I am Henry. My passion lies in creating high-performing teams, optimizing business processes and leading the strategic direction of the business. My expertise includes helping small businesses with a range of accounting services, tax preparation, business advisory, accounting and bookkeeping, and personal tax planning, as well as company, trust and partnership tax returns and more.