Free invoice generator and tax tools for Indonesia

Business profit is taxed by the Directorate General of Taxes (DJP, pajak.go.id). A company pays income tax (PPh Badan) at 22% of taxable income, the rate set for domestic corporate taxpayers from tax year 2022 by Article 17(1)(b) of the Income Tax Law as amended by Law 7/2021. An individual trader pays progressive rates of 5% up to Rp60 million, 15% up to Rp250 million, 25% up to Rp500 million, 30% up to Rp5 billion and 35% above that, after the personal allowance (PTKP). A business with annual gross turnover up to Rp4.8 billion can instead pay the 0.5% final tax described in the small-business rules.

Value added tax (PPN) is charged by businesses confirmed as taxable entrepreneurs (PKP) and paid to DJP. Law 7/2021 fixed the rate at 11% from 1 April 2022 and 12% at the latest from 1 January 2025, and lets the government move it anywhere between 5% and 15% by government regulation after the House of Representatives has discussed it in the budget process. Exports of goods and services are taxed at 0% under Article 7(2) of the VAT Law.

The most recent change to how all of this is administered is Coretax, DJP's single filing and invoicing system, which became the default for tax rights and obligations on 1 January 2025 under Finance Minister Regulation 81/2024 (PMK 81/2024).

Indonesia's turnover-based regime is a final income tax on certain gross turnover, set by Government Regulation 55/2022 and applied through Finance Minister Regulation 164/2023 (PMK 164/2023). Individuals, cooperatives, limited partnerships (CV), firms, limited companies (including one-person companies) and village-owned enterprises (BUMDes) whose gross turnover from business does not exceed Rp4.8 billion in a tax year pay 0.5% of each month's gross turnover (Articles 3(2) and 4(1)). This replaces ordinary income tax on that business income. It does not replace VAT. Under Article 7(2a) of the Income Tax Law, an individual pays nothing on the first Rp500 million of turnover in a tax year, and gives customers who would otherwise withhold tax a written statement of turnover instead of a certificate (PMK 164/2023, Article 8). Income from a free profession is excluded (Article 3(3)(a)), and a taxpayer may choose ordinary rules instead (Article 4(2)(a)).