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Bali Zero handles visas, company setup, tax and property compliance in Indonesia. Ask us directly on WhatsApp.
Chat with Bali Zero on WhatsAppTHR stands for Tunjangan Hari Raya, which translates to "Religious Holiday Allowance." It is a mandatory annual bonus that all employers in Indonesia must pay to their employees before the employee's designated religious holiday.
THR is not a discretionary bonus -- it is a legal obligation under Indonesian labor law, specifically regulated by Permenaker (Minister of Manpower Regulation) No. 6/2016 and Government Regulation PP 36/2021. Every employer, including PT PMA companies, must comply.
Indonesia officially recognizes six religions, and each employee is entitled to THR for one religious holiday per year based on their declared religion:
| Religion | Holiday | Approximate Timing |
|---|---|---|
| Islam | Idul Fitri (Lebaran) | End of Ramadan (March/April) |
| Christianity (Protestant) | Christmas | December 25 |
| Catholicism | Christmas | December 25 |
| Hinduism | Nyepi | March (Bali New Year) |
| Buddhism | Waisak (Vesak) | May |
| Confucianism | Imlek (Chinese New Year) | January/February |
Practical note: Since the majority of Indonesian employees are Muslim, most companies budget for THR around Idul Fitri. However, you must pay THR for each employee based on their own religion, which may mean multiple THR payment dates throughout the year.
THR applies to all workers regardless of employment type:
| Worker Type | Entitled to THR? | Notes |
|---|---|---|
| Permanent employees (PKWTT) | Yes | Full THR or pro-rata |
| Contract employees (PKWT) | Yes | Full THR or pro-rata |
| Daily workers | Yes | If worked 12+ days in the month before holiday |
| Outsourced workers | Yes | Paid by the outsourcing company |
| Foreign workers (TKA) | Yes | Same rules as local employees |
| Freelancers (no employment contract) | No | Not considered employees |
| Domestic workers | Yes | Per Permenaker 2/2015 |
The "months of service" is calculated from the employee's start date to the date of the religious holiday, counted in complete months.
THR = 1 x Monthly Salary
Where "Monthly Salary" includes:
It does not include:
THR = (Months of Service / 12) x Monthly Salary
Example 1: Full-time employee, 3 years tenure
Example 2: New employee, 7 months tenure
Example 3: Employee started January 15, holiday is March 20
Example 4: Daily worker, worked 15 days in the past month
THR must be paid no later than 7 days before the religious holiday (H-7).
For 2026, the key dates are:
| Religion | Holiday Date (Approximate) | THR Deadline |
|---|---|---|
| Islam (Idul Fitri) | March 20-21, 2026 | March 13-14, 2026 |
| Hinduism (Nyepi) | March 22, 2026 | March 15, 2026 |
| Buddhism (Waisak) | May 12, 2026 | May 5, 2026 |
| Christianity/Catholic (Christmas) | December 25, 2026 | December 18, 2026 |
| Confucianism (Imlek) | February 2027 | ~January 26, 2027 |
Many companies pay all THR at Idul Fitri for administrative simplicity, regardless of individual religion. This is legally acceptable as long as it is agreed upon with the employees and THR is not paid later than the respective religious holiday deadline.
Yes, employers can pay THR earlier than H-7. Some companies pay THR at the beginning of Ramadan (about 30 days before Idul Fitri) as a goodwill gesture.
No. THR must be paid in full, in cash (or bank transfer), in Indonesian Rupiah. It cannot be paid in:
THR is taxable income and must be included in the employee's PPh 21 calculation. The standard method is:
| Annual Taxable Income | Tax Rate |
|---|---|
| Up to IDR 60M | 5% |
| IDR 60M - 250M | 15% |
| IDR 250M - 500M | 25% |
| IDR 500M - 5B | 30% |
| Above IDR 5B | 35% |
Employee earning IDR 8,000,000/month with THR of IDR 8,000,000:
5% of total THR payable to the employee as a late payment penalty.
The penalty begins from the day after the H-7 deadline. For example:
| Escalation Level | Action |
|---|---|
| First | Written warning from Disnaker |
| Second | Operational activity restriction |
| Third | Temporary suspension of business processes |
| Fourth | Business license freezing |
Under the labor law, willful non-payment of THR can lead to:
Employees can report THR violations to:
The government actively monitors THR compliance through Posko THR task forces that operate in the weeks before Idul Fitri. Companies that receive complaints are visited by inspectors.
If an employee resigns within 30 days before their religious holiday, they are still entitled to THR. The logic is that they were employed during the period leading up to the holiday.
Employees terminated within 30 days before their religious holiday are entitled to THR as part of their final settlement, in addition to severance pay.
Employees on any type of approved leave (annual leave, sick leave, maternity leave) remain entitled to full THR.
An employee who works for multiple employers (legally, e.g., part-time contracts) is entitled to THR from each employer based on their salary with that employer.
If a company genuinely cannot pay THR by the deadline, it must:
There is no exemption from paying THR entirely. Even companies undergoing bankruptcy must include THR in employee claims.
Assuming average salary of IDR 6,000,000/month:
| Item | Amount |
|---|---|
| Total THR (10 employees x IDR 6M) | IDR 60,000,000 |
| Employer BPJS on THR (negligible - THR is not regular salary) | IDR 0* |
| PPh 21 on THR (varies by individual) | ~IDR 3,000,000 total |
| Total THR cost to employer | ~IDR 60,000,000 |
*Note: BPJS contributions are calculated on regular monthly salary, not on THR. THR is excluded from the BPJS calculation base.
Set aside approximately 8.3% of total monthly payroll each month (1/12 of annual THR obligation) in a dedicated savings account. This prevents THR from creating a cash flow shock.
Monthly accrual for 10 employees at IDR 6M average:
THR must be paid no later than 7 days before the employee's religious holiday. For Muslim employees (the majority), this means 7 days before Hari Raya Idul Fitri (Lebaran). In 2026, Idul Fitri is expected around March 20-21, so THR must be paid by approximately March 13-14, 2026.
Employees with less than 1 month of continuous service are not entitled to THR. Employees with 1-12 months of service receive pro-rata THR calculated as (months of service / 12) x one month salary. The minimum service period is 1 month of continuous employment.
Employers who pay THR late face a penalty of 5% of the total THR amount owed, payable to the employees. If the employer refuses to pay THR entirely, they can face administrative sanctions from Disnaker including written warnings, operational restrictions, and business license freezing. Criminal penalties may also apply under labor law.
Bali Zero supports PT PMA employers with THR compliance:
Contact us at info@balizero.com or WhatsApp +62 813 3805 1876 for employer compliance support.