PPh 25 Monthly Installments 2026: Calculation Formula, Payment Schedule, and Exemptions

What Is PPh 25?

PPh 25 (Pajak Penghasilan Pasal 25) is a monthly prepayment mechanism for Indonesian income tax. Think of it as paying your annual tax bill in monthly installments rather than as a lump sum at year-end.

The Indonesian tax system requires taxpayers, both individuals and corporations, to make monthly installment payments based on their previous year's tax liability. These payments are credited against the annual tax due when filing the SPT Tahunan (annual tax return). The difference between total PPh 25 payments made and the actual tax liability results in either:

• PPh 29 (underpayment): You owe additional tax
• PPh 28 (overpayment): You are entitled to a refund or carry-forward credit

For PT PMA companies, PPh 25 is one of the most regular tax obligations, requiring attention every single month.

The PPh 25 Calculation Formula

The basic formula for PPh 25 monthly installments is:

PPh 25 Monthly Installment = (PPh Badan Terutang - Tax Credits) / 12

Where:

• PPh Badan Terutang = Corporate income tax due from the previous year's SPT Tahunan
• Tax Credits = PPh 22, PPh 23, PPh 24 that were withheld or prepaid during the previous year

Detailed Calculation Steps

Step 1: Determine Previous Year's Tax Liability

Start with the corporate income tax calculated in your most recent SPT Tahunan Badan:

Taxable Income = Gross Revenue - Allowable Deductions
PPh Badan Terutang = Taxable Income x Corporate Tax Rate (22%)

Step 2: Subtract Tax Credits

Deduct the following credits from the tax liability:

Note: PPh 21 (employee tax) is NOT a credit for PPh 25 calculation because PPh 21 is the employee's tax, not the company's.

Step 3: Divide by 12

Monthly PPh 25 = (PPh Badan Terutang - PPh 22 - PPh 23 - PPh 24) / 12

Practical Example

PT Indo Pacific Trading (PT PMA)

2025 SPT Tahunan Badan:

• Gross Revenue: IDR 8,000,000,000
• Allowable Deductions: IDR 6,500,000,000
• Taxable Income: IDR 1,500,000,000
• PPh Badan Terutang (22%): IDR 330,000,000

Tax credits during 2025:

• PPh 22 (imports): IDR 15,000,000
• PPh 23 (services received): IDR 12,000,000
• PPh 24 (foreign tax credit): IDR 8,000,000
• Total credits: IDR 35,000,000

PPh 25 calculation:

Monthly PPh 25 = (IDR 330,000,000 - IDR 35,000,000) / 12
Monthly PPh 25 = IDR 295,000,000 / 12
Monthly PPh 25 = IDR 24,583,333 (rounded to IDR 24,583,000)

This amount is paid every month from January through December 2026.

When PPh 25 Changes During the Year

The monthly PPh 25 amount is not always constant throughout the year. It changes based on when you file your annual tax return:

Why the shift? Because the previous year's SPT Tahunan is typically filed in April. Until it is filed, the PPh 25 installment continues based on the older return.

Example of the Transition

PT Indo Pacific Trading - 2026 PPh 25 Schedule:

Payment and Filing Deadlines

PPh 25 has two separate deadlines each month:

Example Timeline for January 2026 PPh 25:

1. January 2026: Tax period
2. February 15, 2026: Payment deadline - generate billing code in CoreTax, pay through bank
3. February 20, 2026: Filing deadline - submit SPT Masa PPh 25 in CoreTax

How to Pay PPh 25

1. Log in to coretaxdjp.pajak.go.id
2. Navigate to "Pembayaran" (Payments) > "Buat Kode Billing" (Create Billing Code)
3. Select:
   • Tax type: PPh Pasal 25 (411125)
   • Tax period: the relevant month
   • Tax year: current year
   • Amount: your calculated monthly installment
4. Generate the billing code (Kode Billing)
5. Pay through one of these channels:
   • Internet banking (BCA, Mandiri, BNI, BRI, etc.)
   • ATM transfer
   • Over-the-counter at bank
   • Mobile banking
6. Save the payment receipt (Bukti Penerimaan Negara / BPN)
7. File SPT Masa PPh 25 in CoreTax by the 20th

Late Payment Penalties

Missing PPh 25 deadlines triggers two types of penalties:

Penalty Calculation Example

PT Indo Pacific Trading misses the February 15 payment deadline for January 2026 PPh 25:

• PPh 25 amount: IDR 24,583,000
• Paid on March 5 (18 days late = 1 month for penalty calculation)
• Late payment penalty: IDR 24,583,000 x 2% x 1 month = IDR 491,660
• Late filing penalty (if also missed): IDR 1,000,000
• Total penalties: IDR 1,491,660

PPh 25 for Different Company Situations

New Companies (First Year)

For newly established PT PMA companies with no prior year SPT Tahunan:

• Default: PPh 25 installment is IDR 0 (nil) until the first annual return is filed
• Exception: If DJP determines projected income justifies installments, they may set an estimated amount based on similar businesses
• Best practice: Even with zero PPh 25, file the SPT Masa PPh 25 as "nihil" (nil) every month to avoid filing penalties

Companies Using the UMKM Rate (PP 55/2022)

If your PT PMA qualifies for the 0.5% UMKM final tax rate (gross revenue below IDR 4.8 billion/year):

• PPh 25 installments are not applicable
• Instead, you pay 0.5% of monthly gross revenue as PPh Final
• This is paid by the 15th of the following month
• The UMKM rate is available for the first 3 years of a PT's operation (or 4 years for a CV)

Note: PT PMA companies became eligible for the UMKM rate under the HPP Law (UU 7/2021), but the gross revenue threshold must not exceed IDR 4.8 billion per year.

Companies with Significant Revenue Fluctuation

If your business is seasonal (tourism, agriculture, event management), your actual monthly income may vary significantly from the flat PPh 25 amount. Options:

1. PPh 25 reduction request (see below)
2. Accept the fluctuation - overpayments in slow months are credited against year-end liability
3. Plan cash flow accordingly - set aside funds during peak months for off-season PPh 25 payments

Companies with Tax Losses

If your previous year resulted in a tax loss (no PPh Badan Terutang):

• PPh 25 monthly installment = IDR 0
• File SPT Masa PPh 25 as nihil each month
• When you return to profitability, PPh 25 installments resume based on the profitable year's SPT

How to Reduce PPh 25 Installments

If your current year revenue is significantly lower than the previous year, you can request a reduction of your PPh 25 monthly installment:

Eligibility

You can apply for a PPh 25 reduction if:

• Your projected annual income is at least 25% lower than the previous year
• You can demonstrate the decline with supporting evidence (financial statements, order books, contracts)

Application Process

1. Prepare documentation:

   • Projected income statement for the current year
   • Comparison with previous year
   • Supporting evidence (client contract cancellations, market data, etc.)
   • Calculation of proposed reduced PPh 25 amount

2. Submit to KPP:

   • File a written request to your registered KPP
   • Include the proposed reduced installment amount and calculation basis

3. KPP review:

   • Processing time: approximately 1 month
   • KPP may accept, reject, or modify your proposed amount

4. Effective date:

   • The reduction takes effect from 2 months after the approval date
   • It applies for the remainder of the tax year

Important Warning

If you reduce your PPh 25 but your actual year-end tax liability turns out to be higher than expected, DJP will impose a 2% monthly penalty on the shortfall between what you paid and what you should have paid. Only request a reduction if you are confident in your projected decline.

PPh 25 and the Corporate Tax Rate

Indonesia's corporate income tax rate directly impacts your PPh 25 calculation:

The Article 31E Facility (50% Discount)

For companies with gross revenue up to IDR 50 billion, Article 31E of the Income Tax Law provides a 50% reduction of the 22% rate on taxable income proportional to the first IDR 4.8 billion of gross revenue:

Discounted portion = (IDR 4.8B / Total Revenue) x Taxable Income
Full-rate portion = Taxable Income - Discounted portion

Tax = (Discounted portion x 11%) + (Full-rate portion x 22%)

Example:

• Revenue: IDR 10,000,000,000
• Taxable Income: IDR 2,000,000,000
• Discounted portion: (4.8B / 10B) x 2B = IDR 960,000,000
• Full-rate portion: 2B - 960M = IDR 1,040,000,000
• Tax: (960M x 11%) + (1.04B x 22%) = IDR 105,600,000 + IDR 228,800,000 = IDR 334,400,000
• Effective rate: 16.72% (instead of 22%)

This lower tax amount flows through to a lower PPh 25 monthly installment.

Common PPh 25 Mistakes

PPh 25 Reporting in CoreTax

Filing SPT Masa PPh 25 in CoreTax involves:

1. Log in to CoreTax
2. Navigate to "Pelaporan" (Reporting) > "SPT Masa PPh 25"
3. Select the tax period
4. Enter:
   • Monthly installment amount
   • Payment date and BPN (Bukti Penerimaan Negara) number
   • Any adjustments (if applicable)
5. Review and submit
6. Save the filing receipt (Bukti Penerimaan Elektronik / BPE)

Frequently Asked Questions

When is PPh 25 due each month?

PPh 25 payment is due by the 15th of the following month (e.g., January PPh 25 is due by February 15). The filing of SPT Masa PPh 25 is due by the 20th of the following month. If the deadline falls on a weekend or holiday, the deadline extends to the next working day.

Can I reduce my PPh 25 monthly installment amount?

Yes. If your current year revenue is significantly lower than the previous year, you can apply for a PPh 25 reduction at your KPP. You must demonstrate that projected tax liability is at least 25% lower than the previous year. The reduction takes effect 2 months after approval.

What happens if my company is in its first year and has no prior tax return?

For new companies with no prior year SPT, PPh 25 installments are typically zero until the first annual tax return is filed. However, if DJP determines that your company should be paying installments based on projected income, they may set an estimated amount.

Is PPh 25 the same as corporate income tax?

PPh 25 is not a separate tax. It is a monthly prepayment of your annual corporate income tax (PPh Badan). The total PPh 25 paid during the year is credited against your annual tax liability. Any underpayment is settled as PPh 29, and any overpayment can be refunded or carried forward.

Professional Tax Management

Managing PPh 25 correctly requires accurate calculations, timely payments, and proper CoreTax filings every single month. For PT PMA companies, getting this wrong creates compounding penalties and potential audit triggers.

Bali Zero's Accounting Basic package at IDR 1,500,000/month includes monthly PPh 25 calculation, billing code generation, payment processing, and SPT Masa filing through CoreTax. The Accounting Premium package at IDR 3,000,000/month adds comprehensive tax planning, PPh 25 optimization strategies, and proactive reduction requests when applicable.

Contact Bali Zero at info@balizero.com or WhatsApp +62 821 3454 721 for monthly tax compliance management.