Value-Added Tax ( Pajak Pertambahan Nilai or PPN) is usually imposed on the sale of goods or services that occurs on consumption by the individual, corporate, and government taxpayers. When you are about to hire workers, you are obliged to calculate the tax through their salary, pay the tax, and file the WHT 21/26 report.Ī withholding tax, or a retention tax, is an income tax to be paid to the government by the payer of the income rather than by the recipient, and the tax will be deducted from the income. What Should You Prepare For When Employing Workers? WHT art 21 for employee / taxpayer that received an income, the progressive tariff are:ĥ% for yearly income tax up to 50 million IDRġ5% for yearly income tax in between 50 million IDR – 250 million IDRĢ5% for yearly income tax in between 250 million IDR – 500 million IDRģ0% for yearly income tax more than 500 million IDR WHT art 4(2) for rental building: 10% from tax (imposition) base WHT art 23 for services: 2% from tax (imposition) base (if have NPWP), or 4% from tax (imposition) base (if don’t have NPWP) Your Tax obligation depends on your WHT, for example While the Yearly Reports are: Corporate Income Tax Return (CITR) and Individual WHT art 21/26 The monthly reports are: WHT art 21/26, WHT art 23/26, WHT art 4(2), WHT art 15, and VAT Indonesian Tax Regulation required both monthly and yearly tax reports. Having a Tax ID Number and relief certificate means you are obliged to pay and file a tax report to the Indonesian authority. First, you should register as a taxpayer so you’ll get a Tax ID number (NPWP), tax relief certificate (SKT), and taxable VAT entity confirmation number (SPPKP) – which is additional, if your business has a gross revenue more than 4.8 billion IDR/year. Tax obligations are one of the most important aspects when you’re establishing a business, including in Indonesia.
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