Corporate Income Tax Indonesia 2026 | CIT Guide

Q: What is the corporate tax rate in Indonesia for 2026?

The standard corporate income tax (PPh Badan) rate is 22%. SMEs with annual revenue under IDR 4.8 billion qualify for 0.5% final tax rate. Publicly listed companies with 40%+ free float get a 3% reduction to 19%.

Q: What expenses can Indonesian companies deduct from taxable income?

Deductible expenses include employee salaries and benefits, office rent and utilities, depreciation of assets, business travel, professional fees, bad debts (with conditions), and CSR contributions up to 5% of net income. Entertainment expenses require a nominative list.

Q: When is the corporate tax return due in Indonesia?

Corporate SPT Tahunan PPh Badan is due by April 30 each year, four months after the fiscal year ends. Monthly corporate tax installments (PPh 25) are due by the 15th of each month.

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Corporate Income Tax Indonesia 2026: Complete Guide

Corporate income tax (PPh Badan) is a significant consideration for any business operating in Indonesia. Here's what you need to know.

Tax Rates Overview

Corporate Income Tax Rates

Current rates for different entities

Feature	Standard Rate Most companies	Public Company Listed companies	SME Rate Small businesses	Final Tax Certain sectors
Rate	22%	19%	0.5% of turnover	Varies (0.5-10%)
Applies To	Net taxable income	IPO with 40%+ free float	Turnover < IDR 4.8B	Specific industries
Entity Type	PT, CV, etc.	Listed PT	CV, PT with low revenue	Construction, etc.

Tax Calculation

Corporate Tax Estimator

Estimate your annual corporate tax

Default Inputs

Annual Revenue (IDR): 5,000,000,000 IDR
Deductible Expenses (IDR): 3,500,000,000 IDR
Company Type: Standard PT/PT PMA

Estimated Result

RevenueRp 5.000.000.000

ExpensesRp 3.500.000.000

Taxable ProfitRp 1.500.000.000

Tax DueRp 330.000.000

Estimated total

Rate applied: 22%

Rp 330.000.000

SME Final Tax (PP 55/2022)

Simplified for Small Business

Businesses with gross turnover under IDR 4.8 billion/year can use simplified final tax:

Rate: 0.5% of gross turnover
No complex calculations
Monthly payment
Applies to: PT, CV, individuals with business
Duration: Maximum 7 years for PT, 4 years for CV/individuals

After the maximum period, regular rates apply.

SME Tax Example

Monthly Revenue	Tax Due
IDR 100M	IDR 500K
IDR 200M	IDR 1M
IDR 400M	IDR 2M

Deductible Expenses

What's Deductible?

Common Deductible Expenses

0 of 8 completed

Non-Deductible Expenses

Expense	Notes
Dividends	Not an expense
Personal expenses	Must be business-related
Donations (most)	Some exceptions
Fines and penalties	Government fines
Entertainment (undocumented)	Need proper documentation
Related party premium	Above market rate

Depreciation

Depreciation Groups

Group	Assets	Rate (Straight-line)	Rate (Declining)
1	4-year life	25%	50%
2	8-year life	12.5%	25%
3	16-year life	6.25%	12.5%
4	20-year life	5%	10%
Building (permanent)	20-year	5%	-
Building (non-permanent)	10-year	10%	-

Tax Filing Requirements

Annual Corporate Tax Return

Filing Deadlines

SPT Tahunan Badan (Annual Corporate Tax Return): - Deadline: 4 months after fiscal year-end - For calendar year: April 30 - Extension: Up to 2 months possible - Method: e-Filing mandatory

Monthly Obligations

Obligation	Deadline	Description
PPh 21	10th of following month	Employee withholding
PPh 23	10th of following month	Service withholding
PPh 25	15th of following month	Prepaid CIT installment
PPh 4(2)	10th of following month	Final tax items
VAT (PPN)	End of following month	If VAT registered

Transfer Pricing

Related Party Transactions

Indonesia has strict transfer pricing rules for transactions between related parties:

Must be at arm's length prices
Documentation required (Master File, Local File)
Country-by-Country Reporting for large groups
Penalties for non-compliance

Work with qualified tax advisors for related party transactions.

Documentation Requirements

Report	Required For	Threshold
Master File	Large taxpayers	Revenue IDR 50B+
Local File	Related party deals	Any material transaction
CbC Report	Multinationals	Group revenue €750M+

Tax Incentives

Available Incentives

Incentive	Benefit	For Whom
Pioneer Industry	Tax holiday up to 20 years	Large investments
Investment Allowance	30% super deduction	Qualifying investments
R&D Incentive	300% deduction	Research activities
Vocational Training	200% deduction	Training programs
Special Economic Zone	Various	SEZ located businesses

Common Issues for Foreign Companies

PT PMA Considerations

Thin Capitalization - Debt/equity ratio limits (4:1)
Transfer Pricing - Related party transactions scrutiny
Withholding Taxes - Payments to foreign affiliates
Permanent Establishment - Careful structuring needed
Tax Treaties - Check applicability

Compliance Calendar

Month	Activity
January	Previous year reconciliation
March	Prepare annual return
April	File annual return (due April 30)
Monthly	PPh installments and withholding
Quarterly	Review and adjust estimates

Penalties

Violation	Penalty
Late filing	IDR 1M/month (max 24 months)
Late payment	2% per month
Underpayment	2% per month + potential 200%
Tax fraud	Criminal penalties possible

Common Questions

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Corporate Income Tax Indonesia 2026: Complete Guide

Questions about how this applies to your case?

Corporate Income Tax Indonesia 2026: Complete Guide

Tax Rates Overview

Corporate Income Tax Rates

Tax Calculation

Corporate Tax Estimator

Default Inputs

Estimated Result

SME Final Tax (PP 55/2022)

SME Tax Example

Deductible Expenses

What's Deductible?

Common Deductible Expenses

Non-Deductible Expenses

Depreciation

Depreciation Groups

Tax Filing Requirements

Annual Corporate Tax Return

Monthly Obligations

Transfer Pricing

Documentation Requirements

Tax Incentives

Available Incentives

Common Issues for Foreign Companies

PT PMA Considerations

Compliance Calendar

Penalties

Common Questions

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