Corporate income tax in Indonesia is charged at 22% on taxable income under the Income Tax Law as amended by UU HPP, with a 50% reduction on the first Rp4.8 billion of turnover for companies with turnover up to Rp50 billion. Compliance runs through monthly withholding, VAT and an annual return in Coretax.
General information, not tax advice. Positions depend on the facts and on the regulation text in force.
What is the corporate tax rate in Indonesia?
The general corporate income tax rate is 22%, and a reduced rate applies to part of the taxable income of smaller companies under Article 31E of the Income Tax Law.
DGT states that the Article 17 rate for corporate taxpayers is 22% under UU HPP (DGT: corporate tax rates). Under Article 31E, a domestic company with gross turnover up to Rp50 billion gets a 50% reduction on the rate for taxable income from the portion of turnover up to Rp4.8 billion (DGT: Article 31E). The facility does not cover the whole of the first Rp50 billion of turnover, which is a common misunderstanding.
| Company turnover | Treatment |
|---|---|
| Up to Rp4.8 billion | Effective 11% on all taxable income (50% × 22%) |
| Above Rp4.8 billion up to Rp50 billion | 11% on the share attributable to the first Rp4.8 billion of turnover; 22% on the rest |
| Above Rp50 billion | 22% on all taxable income |
For a worked calculation, see our SPT Tahunan guide for SMEs, where turnover of Rp10 billion and taxable income of Rp1 billion produce Rp167.2 million of tax against Rp220 million without the facility (assuming apportionment by turnover).
What does a foreign-owned company need to get right?
A PT PMA's recurring obligations are monthly withholding, VAT, and the annual return; the faults usually come from the interfaces between them, not from any single tax.
Common mistakes we see in practice:
- Treating Coretax as only a new portal. Withholding certificates, VAT invoices and the annual return are linked in Coretax, so a mismatch in one place appears in another.
- Ignoring NITKU and the 16-digit taxpayer number. Branch NPWPs were replaced by NITKU, and obligations for several business places are carried out centrally under PMK 81/2024. See NPWP Online (Indonesian).
- Missing withholding on payments. Services listed in PMK 141/PMK.03/2015 attract PPh 23; see Tarif Pajak PPh 23 (Indonesian). Payments abroad fall under Article 26.
- Using the wrong PPh 21 method. Employees' tax uses TER for January to November and the annual computation in December; see Income Tax Article 21.
- Assuming a small-business regime applies. The 0.5% final regime was retained by PP 20/2026, but eligibility by entity type changed (DGT overview). Check whether a PT PMA can use it at all before relying on it.
- Filing late or without the right attachments. Corporate returns need financial statements and the reconciliation attachment, with audited accounts where audited.
What is the annual compliance cycle?
The cycle is monthly (withholding and VAT) and annual (the corporate return, due four months after year-end).
| Item | Timing | Reference |
|---|---|---|
| PPh 21 and PPh 23 deposit | By the 10th of the following month | PMK 184/PMK.03/2007 as amended, per DGT |
| PPh 21 and PPh 23 monthly return | By the 20th of the following month | DGT guidance |
| VAT | End of the following month | See Apa Itu PPN? and VAT in Indonesia |
| Annual corporate return | 4 months after year-end (30 April) | UU KUP Art. 3(3) |
| Late annual return penalty | Rp1,000,000 | UU KUP Art. 7 |
A deadline missed on withholding or VAT is not cured by filing the annual return. Coretax transitional relaxations were issued for specific periods and have ended, so do not assume extensions.
How does Coretax affect the annual return?
Corporate returns for tax year 2025 are filed in Coretax; tax year 2024 returns were filed in DJP Online.
DGT's Coretax guidance says the return starts from the main form, then attachments; statements are attached by method and audited where audited; and a balance due can be paid through deposit or billing code (Coretaxpedia). Before the filing season, reconcile the withholding certificates and VAT data in Coretax with the ledger, confirm who holds the authority to submit, and confirm the registered data is current.
Where should a CFO focus?
Prioritise reconciliation between the ledger, withholding certificates and VAT, because inconsistencies there are the easiest to avoid and the hardest to explain later.
A one-page checklist: (1) a named owner for the compliance calendar; (2) a monthly reconciliation of tax accounts; (3) payment classification before invoices are paid; (4) review of the tax reconciliation alongside the audit; (5) a Coretax access and authority check. JCSS Indonesia performs readiness reviews under its Tax Compliance and Audit Readiness service. DGT's own role is described in the Directorate General of Taxes in Indonesia.
Frequently asked questions
What is the corporate income tax rate in Indonesia?
The general rate is 22% under Article 17 of the Income Tax Law as amended by UU HPP, according to DGT. Qualifying companies with turnover up to Rp50 billion get a 50% reduction on the part of taxable income attributable to turnover up to Rp4.8 billion under Article 31E.
When must a company file its corporate tax return?
Four months after the end of the tax year, which is 30 April for a calendar-year company (UU KUP Art. 3(3)). An extension of up to two months is available by notification within that period, but it does not extend the time to pay.
Do foreign-owned companies get different treatment?
A PT PMA is a domestic taxpayer and follows the same corporate rules. Differences arise in cross-border payments, which fall under Article 26 and any applicable tax treaty. These need transaction-specific review, because treaty relief depends on documentation and the treaty text.
What is the penalty for filing late?
UU KUP Article 7 sets Rp1,000,000 for a late corporate annual return, collected by tax assessment letter. Late payment of tax is a separate matter and should not be left to the filing deadline. Build the penalty risk into your internal calendar so that the return and any payment are completed well before 30 April.
Is Coretax mandatory for corporate returns?
For tax year 2025, DGT guidance states corporate annual returns are filed through Coretax, whereas tax year 2024 returns went through DJP Online. Treat Coretax as the filing channel, test account access well before the deadline, and confirm that the person submitting holds the right authority for the company.
General information only, not legal or tax advice for your specific facts. Regulations change; confirm the current position with JCSS Indonesia before acting.