Jakarta, CNBC Indonesia - As Lebaran approaches, the payment of\nTunjangan Hari Raya (THR), or Holiday Allowance, is one of the most\nanticipated moments for workers throughout Indonesia, whether civil\nservants or private sector employees.<\/p>\n
However, employees must pay tax on the THR they receive. Why is THR\ntaxed? Because THR constitutes additional income received by\nemployees\/workers.<\/p>\n
Under Law PPh 7\/2021 Article 4 Paragraph 1, income is defined as any\nincrease in economic capacity received or obtained by a taxpayer,\nwhether originating from Indonesia or abroad, which can be used for\nconsumption or to increase the wealth of the taxpayer in question,\nregardless of name and form.<\/p>\n
Meanwhile, under Article 21 Paragraph 1 Letter a, tax withholding on\nincome related to work, services, or activities in any name and form\nreceived or obtained by domestic individual taxpayers must be carried\nout by the employer who pays salary, wages, honorarium, allowances, and\nother payments as remuneration for work performed by employees or\nnon-employees.<\/p>\n
The tax calculation method uses the monthly effective rate (TER). To\ncalculate PPh Article 21 on THR, the following formula can be used:<\/p>\n
THR Gross \u00d7 Monthly TER.<\/p>\n
To determine the TER, reference can be made to Government Regulation\n58\/2023 and Ministerial Decree 168\/2023, or alternatively, the tax\ncalculator at kalkulator.pajak.go.id can be used.<\/p>\n
Example of Tax Calculation on THR<\/p>\n
As an example, Mr Argi, a permanent employee at PT BGM, worked\nfull-time throughout 2025 with a monthly income of Rp 5,800,000, with no\nadditional income, and is married with no dependents (K\/0).<\/p>\n
Mr Argi received THR equivalent to 1x his monthly salary in March,\nvariable overtime payments in February, May, and November, and bonuses\nof 2x his monthly salary in October, as well as JKK and JKM insurance\npremiums of Rp 80,000 per month.<\/p>\n
Based on the TER calculation, the PPh Article 21 payable on THR and\nsalary in March is calculated as follows:<\/p>\n
(Salary + THR + JKK & JKM Premiums) Rp 11,680,000 \u00d7 4.00% (TER\nCategory A) = Rp 467,000 (PPh 21 Payable).<\/p>\n
The PPh Article 21 for March will subsequently be recalculated at\nyear-end to determine any remaining PPh Article 21 for December that\nmust be withheld or refunded.<\/p>\n
In this example, it transpired that PT BGM had over-withheld PPh\nArticle 21 due to TER application in the amount of Rp 963,800.<\/p>\n
Therefore, PT BGM is obligated to refund the excess withholding to Mr\nArgi.<\/p>\n
Mr Argi also has the right to enquire about the status of the excess\ntax withholding with his company.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/dont-worry-heres-how-to-calculate-tax-on-holiday-allowance-1773291272", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }