INCOME TAX ARTICLE 21

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 INCOME TAX ARTICLE 21
Income tax withheld in connection with work,
services and activities carried out by Individual
Taxpayers is a tax on income on salaries, wages,
honoraria, allowances, and other payments by name
and in any form related to work or position, services,
and activities carried out by domestic private
taxpayers.
Article 21 of Income Tax is deducted, deposited,
and reported by the Tax Payer, namely the
employer, government treasurer, pension fund,
agency, company and organizing activities.

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 TAXPAYERS OF INCOME TAX ARTICLE 21
Recipients of income deducted by PPh Ps 21:
1) State officials
2) Government employees
3) Employee
4) Permanent employee
5) Employees with foreign taxpayer status
6) Free worker
7) Pension Recipients
8) Honorarium recipient
9) Wage Recipient
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 NOT TAXPAYERS OF INCOME TAX ARTICLE 21
1. Diplomatic and consular representative
officials
 Not an Indonesian citizen
 Not receiving / earning other income outside his
position in Indonesia
 The country concerned provides reciprocal treatment
2) Representative of international organizations
 Not an Indonesian citizen
 Not running a business / doing other activities / work
to earn income in Indonesia

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 TAX SUBJECT INCOME TAX ARTICLE 21
1) Employees (civil servants, permanent
employees, freelancers who regularly earn
income from employers)
2) Pension recipient
3) Honorary recipient
4) Wage recipient
5) An individual who earns income in
connection with work, services, or activities
of the tax deductor

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 EXCLUSION OF TAX SUBJECTS
1) Diplomatic and consular representative
officials or other officials from foreign
countries and people who are seconded to
them and residing in the same place as them
on the condition that they are not Indonesian
citizens and do not receive / earn other
income outside their positions
2) Representatives of international
organizations with non-Indonesian citizens'
conditions and not running other businesses
/ activities to earn income in Indonesia
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 RIGHTS AND OBLIGATIONS OF TAX
SUBJECTS

1) When starting work or starting retirement,

to get a reduction in non-taxable income,
the recipient of the income must submit a
statement to the tax cuter as referred to in
Article 21 stating the number of family
dependents at the beginning of the tax year
or at the beginning being the subject of
domestic tax. 7
2. The amount of Income Tax Article 21 that is
deducted is a tax credit for the recipient of
income subject to deductions for the
relevant tax year, except income tax which
is final
3. If the taxpayer receives income from an
employer who is exempt from being a tax
cuter, then the taxpayer must calculate,
deposit, and report himself in the tax return
on the income.
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 TAX OBJECT
1. Income received / obtained by employees /
recipients on a regular basis in the form of
salaries, monthly pensions, wages,
honoraria, allowances
2. Income received / obtained by employees /
recipients irregularly in the form of
production services, bonuses, THR,
gratuities, bonuses
3. Daily wages, piece rates, unit wages, piece
wages received by freelancers
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4. Pension money, old age insurance money,
severance pay, in connection with layoffs
5. Salary, honorarium, other allowances related
to salaries / honorarium that are not permanent
received by civil servants
6. Receipts in the form of nature and other
pleasures provided by non-taxpayers other
than government or taxpayers who are subject
to final income tax and which are imposed
based on special calculation norms (deemed
profit)
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7. Honorarium, pocket money, prizes / awards,
commissions, scholarships, and other
payments in return for work, services:
 Experts
 Sportsman
 advisor, teacher, trainer, lecturer
 Music player, host, comedian
 Ad agency
 Race participants
 Merchandise vendors
 Participants in education, training,
apprenticeship
 Distributor of MLM entrepreneurs
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TAX OBJECT EXCEPTION

1. Payment of insurance from health insurance

companies, life insurance, dual-purpose
insurance.
2. Acceptance in the form of nature / enjoyment
except income that is deducted by PPh Article
21 including receipt in the form of nature /
enjoyment provided by non-WP / WP subject to
final income tax
3. Pension contributions and old-age insurance
contributions paid by employers
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4. Acceptance in the form of natura /
kenikamatan given by the government.
5. Enjoyment in the form of taxes borne by
the government
6. Zakat received by the authorized OP
from the amil zakat body / institution that
is formed / authorized by the government

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 WHO CUT THE INCOME TAX?
1. Employers who pay salaries, wages,
honoraria, benefits in connection with work /
services carried out by employees / non-
employees
2. Government treasurers who pay salaries,
wages, honoraria, benefits in relation to work
/ position, services and activities
3. Pension funds, Jamsostek organizing bodies,
and other agencies that pay pensions and
ENT / Old Age Insurance
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4. The company, entity, BUT that pays honorarium
as compensation in connection with activities
and services including the services of experts
with the status of WP DN who do free work
5. Persh, the agency, BUT that pays honoraria as
compensation in connection with activities and
services carried out by OP with the status of WP
LN
6. Foundations, committee bodies, associations as
payers of salaries, wages related to work,
services, activities carried out by the OP
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7. The company, the body that pays honoraria
or other benefits to participants in
education, training and apprenticeship

8. Activity organizers (including government

agencies, organizations including internal
organizations, planners, tax objects and
other institutions that carry out activities)
that pay honoraria, prizes or awards of any
kind to domestic taxpayers with respect to
an activity. 16
 TAX CUTTER RIGHTS AND OBLIGATIONS
ARTICLE 21

TAX CUTTING OBLIGATIONS

 Enroll.
 Calculate, deduct, and deposit taxes.
 Recalculating Article 21 of Income Tax
payable.
 Fill out, sign and submit the SPT

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EXCLUDED AS TAX CUTTERS
1. Foreign Country Representative Office,
2. International organizations such as the IMF,
ILO

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 INCOME TAX RATES ARTICLE 21
Tax rates used as deduction rates for income owed
to Article 21 Income Tax are tax rates in Article 17
of the Income Tax Law. The amount of the PPh
Article 21 tax rate that is applied to taxpayers who
do not have a NPWP is 20% higher than the tariff
set for a WP that has an NPWP.

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 POSITION FEES AND PENSION COSTS

Position fee are fees for obtaining, collecting,

and maintaining income of 5% of gross income,
a maximum of Rp. 6,000,000 a year or Rp.
500,000 a month.
Pension costs are the costs of obtaining,
collecting, and maintaining a pension which is
5% of gross income in the form of a pension
maximum of Rp. 432,000 a year or Rp. 36,000 a
month.

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 TAX RATE AND APPLICATION

1.Tariff
Article 17 of the PPh Law, applied to
taxable income from:
a. Permanent employees, the amount of gross
income is reduced by:
 Position allowance,
 Retirement contributions paid by employees
(including old age / retirement savings
contributions)
 Non Taxable Income.

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b. Pension recipients who are paid
monthly, the amount of gross income
is reduced by:
 Pension costs,
 Non Taxable Income
b. Non-permanent employees,
employees and prospective employees
who are paid monthly are equal to
gross income less Non Taxable
Income
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 d. Distributor of MLM companies / direct
selling, gross income every month minus
Non Taxable Income per month

Income Tax Article 21 =

Taxable Income x Tariff Income Tax Law
Article 17

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2. Tariffs based on Article 17 of the Income Tax Law,
are applied to gross income in the form of:
a. Honorarium, allowance, prizes, awards,
commissions, and other payments in the
name as compensation for services or
activities whose amounts are calculated not
on the basis of the number of days needed to
complete the services or activities provided
received or obtained in one month.
In 2009 the scholarship did not become the
object of Article 21 Income Tax.

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 b. Honorarium received or obtained by a member of
the board of commissioners or a supervisory board
that does not concurrently serve as a permanent
employee in the same company for one year.
c. Production services, tantiem, gratuities, bonuses
received or obtained by former employees for one
calendar year
d. Withdrawal of pension funds by participants of the
pension program paid by the providers of the
pension program

Income Tax Article 21 =

Gross Income x Tariff stated on Income Tax Law
article 17 25
3. Tariff 15%, applied to the estimated net income paid or
owed to experts who do freelance(lawyers, accountants,
doctors, architects, notaries, appraisers, actuaries). The
amount of estimated net income is 50% of gross income
in the form of honorarium or other benefits.

Income Tax Article 21 =

(Gross Income x 50%)x 15%

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4. A 5% tariff is applied for daily wages,
weekly wages, unit wages, piece rates and
daily allowances that amount to more than
Rp 132,000 a day but not exceeding Rp
1,320,000 in one month and / not paid
monthly.

Income Tax Article 21 (Day)

=
(Gross Income – Rp 132.000)x 5%

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 TARIFF FINAL INCOME TAX ARTICLE 21
1. Severance pay, pension ransom and Old Age
Allowance or Old Age Guarantee are subject to
final income tax with the following conditions:
 The total gross income of Rp. 25,000,000 or less is not
subject to income tax
 The amount above Rp. 25,000,000 is governed by the
following conditions:

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 Tariff Income Tax Law
Article 17

Taxable Layer Tarif

< Rp 50.000.000 5%
Rp 50.000.000 - Rp 250.000.000 10%
Rp 250.000.000 - Rp 500.000.000 15%
> Rp 500.000.000 25%

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 2. Tariffs of 15% and final are applied to gross
income in the form of honorarium received by
state officials, civil servants, members of the
TNI / POLRI whose source of funds comes from
state finances, unless payable to PNS group 2D
down and TNI / Police rank of Assistant First
Lieutenant down or adjutant Inspector Level
One down.

Final Income Tax article 21 =

Gross Income x 15%
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3. Prizes and race awards are collected at a final
income tax of 25% of the gross prize lottery prize

4. The honorarium / commission paid to the goods

vendor and the outside insurance officer is
collected at the final PPh of 5% of the gross
amount

When Owed
Income tax deduction made by the parties as a
cutter of PPh Article 21 as referred to in Article
21 paragraph 1 of the Income Tax Act is payable
at the end of the month the payment is made or
at the end of the due month the income depends
on the event that occurred first..

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