THR Bonus Indonesia 2026: Religious Holiday Bonus Rules, Calculation & Penalties

What Is THR (Tunjangan Hari Raya)?

THR 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.

Which Religious Holidays Qualify?

Indonesia officially recognizes six religions, and each employee is entitled to THR for one religious holiday per year based on their declared religion:

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.

Who Is Entitled to THR?

Eligible Workers

THR applies to all workers regardless of employment type:

Minimum Service Period

• Less than 1 month: Not entitled to THR
• 1 month to 12 months: Pro-rata THR
• 12 months or more: Full THR (1 month salary)

The "months of service" is calculated from the employee's start date to the date of the religious holiday, counted in complete months.

How to Calculate THR

Full THR (12+ Months Service)

THR = 1 x Monthly Salary

Where "Monthly Salary" includes:

• Base salary (upah pokok)
• Fixed allowances (tunjangan tetap)

It does not include:

• Non-fixed allowances (transport, meals that vary)
• Overtime pay
• Commissions
• Performance bonuses

Pro-Rata THR (1-12 Months Service)

THR = (Months of Service / 12) x Monthly Salary

Calculation Examples

Example 1: Full-time employee, 3 years tenure

• Monthly salary: IDR 5,000,000
• Fixed transport allowance: IDR 500,000
• THR = IDR 5,500,000 (1 month of salary + fixed allowance)

Example 2: New employee, 7 months tenure

• Monthly salary: IDR 4,000,000
• Fixed allowance: IDR 0
• THR = (7/12) x IDR 4,000,000 = IDR 2,333,333

Example 3: Employee started January 15, holiday is March 20

• Complete months of service: 2 months (February 15 - March 15 counted)
• Monthly salary: IDR 6,000,000
• THR = (2/12) x IDR 6,000,000 = IDR 1,000,000

Example 4: Daily worker, worked 15 days in the past month

• Average daily wage: IDR 200,000
• Monthly equivalent: IDR 200,000 x 21 working days = IDR 4,200,000
• If worked 12+ months: THR = IDR 4,200,000

Payment Timeline and Deadlines

When to Pay

THR must be paid no later than 7 days before the religious holiday (H-7).

For 2026, the key dates are:

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.

Can THR Be Paid Early?

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.

Can THR Be Paid in Installments?

No. THR must be paid in full, in cash (or bank transfer), in Indonesian Rupiah. It cannot be paid in:

• Installments over multiple months
• Goods or merchandise
• Vouchers or coupons
• Foreign currency

THR Tax Treatment

PPh 21 on THR

THR is taxable income and must be included in the employee's PPh 21 calculation. The standard method is:

1. Calculate annual income including THR
2. Apply annual PPh 21 rates
3. Subtract PPh 21 already withheld during the year
4. The difference is the PPh 21 on THR

Example Tax Calculation

Employee earning IDR 8,000,000/month with THR of IDR 8,000,000:

• Annual salary: IDR 96,000,000
• THR: IDR 8,000,000
• Total annual income: IDR 104,000,000
• Minus PTKP (tax-free threshold, single): IDR 54,000,000
• Taxable income: IDR 50,000,000
• Tax: IDR 50,000,000 x 5% = IDR 2,500,000
• Monthly average tax: IDR 2,500,000 / 12 = ~IDR 208,333
• In the THR month, higher withholding applies to account for the bonus

Penalties for Non-Compliance

Late Payment Penalty

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:

• THR owed: IDR 5,000,000
• Penalty: IDR 250,000
• Total payable: IDR 5,250,000

Non-Payment Sanctions

Criminal Prosecution

Under the labor law, willful non-payment of THR can lead to:

• Criminal complaint by employees or trade unions
• Investigation by labor inspectors
• Potential prosecution with imprisonment up to 4 years

Reporting by Employees

Employees can report THR violations to:

1. Local Disnaker office
2. Posko THR (THR monitoring posts set up by Disnaker before major holidays)
3. Online complaint system at kemnaker.go.id
4. Labor union representatives

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.

Special Situations

Employees Who Resign Before the Holiday

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.

Terminated Employees

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 Leave

Employees on any type of approved leave (annual leave, sick leave, maternity leave) remain entitled to full THR.

Multiple Employers

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.

Company in Financial Difficulty

If a company genuinely cannot pay THR by the deadline, it must:

1. Negotiate a payment schedule with employees/unions
2. Pay THR no later than the religious holiday itself (not H-7)
3. Still faces the 5% late penalty

There is no exemption from paying THR entirely. Even companies undergoing bankruptcy must include THR in employee claims.

Budgeting for THR

For a PT PMA with 10 Employees

Assuming average salary of IDR 6,000,000/month:

*Note: BPJS contributions are calculated on regular monthly salary, not on THR. THR is excluded from the BPJS calculation base.

Cash Flow Tip

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:

• IDR 60,000,000 / 12 = IDR 5,000,000 per month set aside

THR Compliance Checklist for PT PMA

• Identify each employee's declared religion and corresponding holiday
• Calculate THR for each employee (full or pro-rata)
• Determine payment deadline (H-7 for each holiday)
• Prepare payroll with THR amounts
• Calculate PPh 21 withholding on THR
• Transfer THR to employee bank accounts
• Issue THR payslips with calculation breakdown
• File PPh 21 monthly return including THR amounts
• Keep records of THR payments for minimum 2 years

Frequently Asked Questions

When must THR be paid in 2026?

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.

Do I have to pay THR to employees who just started?

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.

What is the penalty for not paying THR on time?

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.

How Bali Zero Can Help

Bali Zero supports PT PMA employers with THR compliance:

• THR calculation for your entire workforce
• Payroll processing including PPh 21 withholding on THR
• Labor compliance review ensuring all employee obligations are met
• Employment contract drafting with proper THR and benefits clauses
• New company formation (IDR 20,000,000) with compliant HR framework

Contact us at info@balizero.com or WhatsApp +62 821 3454 721 for employer compliance support.