Every business actor in Indonesia is subject to tax. However, every business has a different status, therefore each business status has a different tax liability. Understanding the type of business status being run along with the amount of tax that must be paid is very important for business continuity. So, how much tax in Indonesia?
There are various types of taxes in Indonesia. Depending on the designation, one of them is the tax for small business actors or the small business tax.
Regulations on taxes in Indonesia have regulations that change. So it is very important for business actors to know every change in the most updated tax regulations.
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Regulations on taxation in Indonesia are regulated in Law number 7 of 2021 concerning the Harmonization of Tax Regulations or the HPP Law.
Before entering into the discussion of how much tax in Indonesia is for business actors, you must first know the status of the business you own. Anything? Let’s look at some categories of small business.
Also Read : How Much Is Tax In Indonesia 2022? Check In Here
Category of Small Business in Indonesia
1. Micro Business Category
The micro business category is a business industry run by individuals or households. This business category has criteria for the number of employees less than 4 people, a net income of up to IDR 50 million per year, and a turnover of sales per year reaching IDR 300 million.
2. Small Business Category
The small business category is not much different from the micro business. The difference between micro and small businesses is that they have more employees, namely more than 5 people and less than 19 people.
Second, having net assets of Rp. 50 million to Rp. 500 million. The turnover reaches Rp. 300 million to Rp. 2.5 billion per year.
3. Medium Business Category
Merchant businesses can be carried out by individuals or entities with the condition that they have 20 to 90 employees. Assets range from IDR 500 million to IDR 10 billion. And the annual turnover is IDR 2.5 billion to IDR 50 billion.
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So how much tax in Indonesia must be paid by various categories of business actors? Here’s the review.
Based on PPh Article 4 paragraph 2, every small business that has an employee salary of less than Rp. 32 million per year will be subject to this tax which is often referred to as Final Income Tax.
Based on Government Regulation Number 46 of 2003, Final PPh given to taxpayers is tax from income or business turnover.
SMEs that have a gross turnover or turnover of less than IDR 4.8 billion in one year, will be subject to Final Income Tax.
The amount of tax for PPh Final small business has changed according to PP number 23 of 2018. The amount of tax has changed from 1% to 0.5% only. The following are the details of MSME Final PPh for each Taxpayer.
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How Much Tax In Indonesia for Small Business based on Final PPh
1. Individual Taxpayer
For individual small business, the rate for taxpayers is in accordance with Final PPh, which is 0.5%. The amount of this tax can be obtained within a period of 7 years.
The way to calculate the tax is simple, namely by adding up all income from transactions for one month and then multiplying by 0.5%. The taxpayer pays the amount to the state treasury on the 15th day of the following month.
For example, Amira’s mother has a business with a monthly turnover of Rp. 15 million. Based on Final PPh, how much is a tax in Indonesia for Mrs. Amira? That is 0.5% x Rp 15 million or Rp 75 thousand in a month.
2. Corporate Taxpayer
Corporate taxpayers such as Commodity Partnerships (CV), Cooperatives, and Firms, can also enjoy 0.5% Final Income Tax but with a different time period. The Final PPh period for Corporate Taxpayers is only 4 years.
The way to calculate the tax rate is the same, namely by multiplying the turnover every month by 0.5% Final PPh.
For example, Surya Cooperative has a business with a monthly turnover of IDR 100 million. Based on Final PPh, how much tax in Indonesia for Surya cooperatives? That is 0.5% x Rp 100 million or Rp 500 thousand in a month.
Also Read : Tax Consultant Indonesia: Explanation, Duties or Types of Services and Requirements
3. Limited Liability Company (PT) Taxpayers
For PT Taxpayers, the period to enjoy 0.5% Final PPh is even shorter, which is only 3 years.
For example, PT Jaka has a business with a monthly turnover of IDR 500 million. Based on Final PPh, how much tax in Indonesia for PT Jaka? That is 0.5% x IDR 500 million or IDR 2.5 million in a month.
If you already understand how to calculate taxes, this time how to pay taxes? Easy.
Taxpayers who already have EFIN and tax code, pay taxes every 15th.
Tax payments can be made easily through the Post Office or Bank that has been appointed by the Ministry of Finance. You also make tax payments through M-Banking, Internet banking, or ATM at the bank that has been appointed earlier.
The final income tax amount of 0.5% is expected to be able to reduce tax costs for MSME actors so that MSMEs can grow. Even the SPT report does not need to be done, because the tax payment made is already considered an SPT report.
That way for SMEs that are still developing, no longer need to think about administrative needs for SPT reports.
That’s a review of the Final PPh for small business in Indonesia. If you have a business, how much tax in Indonesia do you have to deposit? Calculate carefully and pay on time.