PPH21, or Pajak Penghasilan Pasal 21, is a tax in Indonesia that pertains to the income tax for individuals, employees, and certain self-employed persons. It's governed by Article 21 of the Indonesian Income Tax Law (Undang-Undang Pajak Penghasilan). The tax applies to income earned by individuals, whether in the form of salaries, wages, bonuses, allowances, or other types of remuneration.
What is the TER scheme?
Effective January 1, 2024, the Indonesian government has implemented a new simplified method for calculating PPh 21 (Article 21 Income Tax) using the average effective rate (TER) scheme.
The TER scheme replaces the previous progressive tax rate system with a simpler and more transparent approach. Under the TER scheme, taxpayers are assigned a TER based on their PTKP (Non-Taxable Income) status and gross income. The TER is then applied to the gross income to determine the amount of PPh 21 to be withheld.
There are three category of Average Tax Effective Rate (TER) based on employees' non taxable income status
TER A | TER B | TER C |
|---|---|---|
Non Taxable Income TK/0 IDR 54,000,000 | Non Taxable Income TK/2 IDR 63,000,000 | Non Taxable Income K/3 IDR 72,000,000 |
Non Taxable Income TK/1 IDR 58,500,000 | Non Taxable Income TK/3 IDR 67,500,000 | |
Non Taxable Income K/0 IDR 58,500,000 | Non Taxable Income K/1 IDR 63,000,000 | |
Non Taxable Income K/2 IDR 67,500,000 |
Source: PP Nomor 58 Tahun 2023 - Tarif Efektif PPh 21 [document attached]
How to calculate the Tax using TER scheme?
Example Calculation 1
Ardianti is a permanent employee at PT Nusa Indah Indonesia. She receives a monthly salary of Rp 11,000,000 and contributes to the following:
- BPJSTK Jaminan Keselamatan Kerja
- BPJSTK Jaminan Kematian
- BPJSTK Jaminan Hari Tua
- BPJSTK Jaminan Pensiun
- BPJS Kesehatan
Ardianti is single and has no dependents (PTKP TK/0).
Salary Type: Gross (Employee pay their own tax)
Income Breakdown
Basic Salary:
IDR 11,000,000Employer Contributions:
- BPJSTK Jaminan Keselamatan Kerja
- Company JKK Percentage is 0.54%
(0.54% x IDR 11,000,000 ) = IDR 59,400
- Company JKK Percentage is 0.54%
- BPJSTK Jaminan Kematian
(0.3% x IDR 11,000,000 ) = IDR 33,000 - ER BPJS Kesehatan
(4% x IDR 11,000,000 ) = IDR 440,000
- BPJSTK Jaminan Keselamatan Kerja
Total Monthly Gross Income:
IDR11,000,000 + IDR 59,400 + IDR 33,000 + IDR 440,000 = IDR 11,532,400
PPh 21 Calculation
January to November Calculation
Based on Ardianti's PTKP TK/0 status and a gross monthly income of IDR 11,532,400,
her TER (Tax Effective Rate) for the January 2024 to November 2024 tax period falls under Category A with a tax rate of 3.5%.
This table can be seen on the attached document
PPh 21 per Month (Jan-Nov):
Monthly Gross Income × Effective Tax Rate
IDR11,532,400 × 3.5% = IDR 403,634 (Jan-Nov)
December Calculation
| Taxable Gross Income | Amount |
| Salary: 11.000.000 x 12 | 132000000 |
| Employer Jaminan Keselamatan Kerja: 59,400 x 12 | 712,800 |
| Employer Jaminan Kematian: 33,000 x12 | 396,000 |
| Employer BPJS Kesehatan: 440,000 x 12 | 5280000 |
| Total Income | 138388800 [A] |
| Deduction | |
| Positional Cost: max 500.000 x 12 [A] | 6000000 |
| Employee Jaminan Pensiun: 100,423 x 12 | 1205076 |
| Employee Jaminan Hari Tua: (2% x 11,000,000) x 12 | 2640000 |
| Total Deduction | 9845076 [B] |
| Annual Net Income = [A] - [B] | 128543724 [C] |
| PTKP (Non Taxable Income) TER A TK/0 | 54000000 [D] |
| Annual Taxable Income = [C] - [D] | 74543724 --> ROUNDDOWN ~74,543,000 |
Annual PPh21 = Tarif Pasal 17 ayat ( 1) huruf a UU PPh x Annual Taxable Income 74,543,000 | Tax Slab 60,000,000 x 5% =3000000 14,543,000 x 15%=2181450 = 5181450 |
| December Tax = Annual Tax - Tax which deduct from Jan until Nov = 5181450 - (403634 x 11) = 5181450 - 4439974 | 741476 |
What is PPH 21 Contribution and PPH 21 Irregular Contribution ?
PPh 21 Contribution is the tax for Regular Income (e.g Salary, Allowance)
PPh 21 Irregular Contribution is the tax for Irregular Income (e.g Bonus, Commission)
Since we are using TER, how to calculate tax:
PPh 21 Irregular = PPH 21 Total - PPH 21 Regular
PPh 21 Total = Monthly Gross Income × Effective Tax Rate
PPh21 Regular = regular Gross Income × Effective Tax Rate
Example Calculation 2: With Irregular Income (NPWP Enable)
Employee name Adam TK/0 (Single with 0 dependent)
Salary: IDR 5,067,381
Overtime (Irregular) = IDR 1,991,803
Employer BPJS Kesehatan= 4% x 5,067,381 = IDR 202,695
Total Monthly Gross Income:
IDR 5,067,381 + IDR 1,991,803 + IDR 202,695 = IDR 7,261,879
How to calculate tax?
PPh 21 Total = 7,261,879 x 1.25% = 90,773
PPh 21 Regular = 0 (Because Under IDR 5,400,000 see picture below) 
PPh 21 Irregular = PPH 21 Total - PPH 21 Regular
= 90,773 - 0
= IDR 90,773
Example Calculation 3: With Irregular Income (NPWP Disable)
Employee name Niranand - TK/0 (Single with 0 dependent)
Salary: 11,400,000
Mobile Allowance (Regular Income) 100,000
THR (Irregular Income) 11,400,000
Monthly Gross Income: 22,900,000
How to Calculate PPH 21 ?
PPH 21 Irregular = PPH 21 Total - PPH 21 Regular
PPH21 Total = 22,900,000 x 9% x 120% (this is because Niranand don't have NPWP) = 2,473,200
PPH21 Regular = (11,400,000 + 100,000) x 3.5% x 120% (this is because Niranand don't have NPWP) = 483.000
PPH21 Irregular = 2,473,200 - 483.000 = 1,990,200
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