This is How Expats Can Pay Personal Income Tax in Indonesia
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As an expat working in Indonesia, you should follow the country’s laws and regulations. This includes the tax obligations set by the Indonesian government. If you’re generating an income in Indonesia, you’re obliged to pay personal income tax. You’re considered as a tax resident of the country if you spend more than 183-days over 12 months in Indonesia. There are several ways available to pay personal income tax in Indonesia. Here’s a short guide to help you through!
e-Billing by DJP
After July 1st, 2016, the payment of income tax in Indonesia has already been made using the online system e-Billing and pay-tax, replacing the manual payment system that used the Tax Payment Slip (SSP), which is expected to increase transparency and eventually to stop administrative manual payments. E-Billing is a 15 digit ID billing code for online tax paying in the tax payment process. Here are several steps of Online Tax payment in e-Billing System:
- Sign-up from the webpage: https://sse.pajak.go.id/
- Click New List, then input your tax id number and email address.
- After you have a User ID, login at https://sse.pajak.go.id/, enter your Tax ID and PIN you receive from email. Follow the flow until you get 15 digits id billing code for tax payment.
- Use Id Billing code to make payments through Bank Teller, ATM, internet banking, or mobile banking (only for BRI customers).
Income tax in Indonesia can be paid through an online payment. Online tax payment procedures can be done in the same way, such as when you pay personal income tax using e-Billing from the DJP. You can bring the ID Billing code to the Bank Teller to pay your income tax. When the transaction is successful, you will get Receipt NTPN (Tax Receipt Payment Number) which equals the Tax Payment Slip (SSP) following the Regulation of the Minister of Finance Number: 242 / PMK.03 / 2014 for Payment and remittance of taxes procedures.
There are requirements for tax payments in Indonesia to workers as in most other nations. What this means is that tax is normally collected by the contractor by turnover and this must be sent annually to the state. Compliance for personal income tax is also given by workers. Indonesia uses the system of self-assessment in which tax filing duties extend to all fiscal residents. For taxpayers receiving income from employment, the tax return used is Form 1770-S. The annual tax returns have to be done by 31 March in the next tax year.
Don’t forget to file a tax return!
To file a tax return, a taxpayer must be enrolled and a tax ID, called the NPWP (Tax Registration Number), must be issued. Expats who are categorized as tax residents must also have an NPWP. Expats who are not qualified as ‘tax residents’ are exempt.
Now you know what to do to pay your income tax in Indonesia. Some of you might ask, what happens if I don’t pay personal income tax? Well, since it’s considered illegal, the punishment will range from fine to imprisonment. You surely don’t want that to happen, do you? So please pay your income tax!