TAX ALERT 01.2024 – WITHHOLDING INCOME TAX ON INCOME RELATED TO WORK, SERVICES, AND ACTIVITIES OF INDIVIDUAL TAXPAYERS

On December 27, 2023, the Government released Government Regulation No. 58 Year 2023 concerning the Rates on the Withholding Income Tax Article 21 for Income related to Work, Services, and Activities of Individual Taxpayers. Furthermore, to provide detailed guidance on the implementation on Withholding Income Tax Law Article 21, the Government has just released Minister of Finance Regulation No. 168 Year 2023 concerning Instructions for the Implementation of Withholding Income Tax on Income related to Work, Services and Activities of Individuals.

Here are some key points that need to be considered regarding those two regulations:
1. There are new rates for calculating Withholding Income Tax Article 21 which are Effective Monthly and Daily Rates.
2. With the new rates for calculating Withholding Income Tax Article 21, the methods for calculating Income Tax Article 21 for Permanent Employees, Non-employees and Non-permanent Employees
have changed.

Government Regulation No. 58 Year 2023 & Minister of Finance Regulation No. 168 Year 2023 shall come into force on January 1, 2024.

Attachments :
SS – 012024 – PP Nomor 58 Tahun 2023
SS – 012024 – Lampiran PP Nomor 58 2023
SS – 012024 – PMK Nomor 168 Tahun 2023
SS – 012024 – Lampiran PMK Nomor 168 Tahun 2023