Individual taxpayers who conduct business activities or freelance work with gross turnover of less than IDR 4.8 billion per year may use a specific turnover calculation for tax purposes. Specific turnover may also be referred to as MSME turnover, which is subject to a final income tax of 0.5% of monthly turnover. In accordance with the Government Regulation number 55 of 2022, individual taxpayers receive a turnover facility of up to IDR 500 million, which is not subject to a final income tax of 0.5%. The 0.5% tax rate is imposed when the turnover or gross turnover exceeds IDR 500 million for one year.
In addition, individual taxpayers who conduct business activities or freelance work with gross turnover of less than IDR 4.8 billion in one year may choose to use the calculation or bookkeeping standard. In accordance with article 1 paragraph 3 of the Directorate General of Taxes Regulation number PER-17/PJ/2025, individual taxpayers who are required to keep records and receive or obtain income that is not subject to final income tax must calculate their net income using the standard calculation. The standard calculation is a guideline for determining the amount of net income that is continuously developed and refined as regulated in article 14 of the Income Tax Law. Before the individual taxpayer is required to notify the Directorate General of Taxes of the use of the standard, they must do so no later than 3 months from the start of the tax year.
Can taxpayers return to the final income tax rate of 0.5% after using the norma calculation?
Income tax at a rate of 0.5% is the lowest income tax rate in Indonesia. This rate is specifically for individual or corporate taxpayers who meet the criteria for taxpayers who can use income tax at a final rate of 0.5%. The requirements are stipulated in the Government Regulation number 55 of 2022. The Directorate General of Taxes emphasizes that individual taxpayers who have already used the calculation or accounting standard cannot re-utilize the 0.5% final income tax. “As long as income from business activities has used the calculation or accounting standard, then the 0.5% final income tax rate cannot be re-utilized,” said the Directorate General of Taxes.
By Olina Rizki Arizal – Partner
TBrights is a tax consultant in Indonesia that is currently an Integrated Business Service in Indonesia that can provide comprehensive tax and business services
Reference:
- The Government Regulation number 55 of 2022 on Adjustment of Regulations in the field of Income Tax
