Corporate Income Tax Non-resident Enterprise Tax Rates, etc. | Indonesian Tax Guide 2025 (7)-熊猫出海

Corporate Income Tax Non-resident Enterprise Tax Rates, etc. | Indonesian Tax Guide 2025 (7)

tax guide Tax Guide Tax guide Corporate income tax corporate income tax Corporate Income Tax Investing in Indonesia 2025-01-15 09:05:26 Page view：1151

This issue's introduction

Corporate income tax

Tax rates, tax scope, taxable income and tax payable for non-resident enterprises

Withholding income tax for non-resident enterprises

Chapter 1 Corporate Income Tax

Non-resident corporate tax rates, scope of collection, taxable income and tax payable

The corporate income tax rate, taxable income and tax payable of non-resident enterprises are the same as those of resident enterprises.

For more information, please review the following articles:

Corporate income tax collection scope and tax rate丨Indonesian Tax Guide 2025 (2)

Corporate income tax payable丨Indonesian Tax Guide 2025 (4)

Corporate income tax payable丨Indonesian Tax Guide 2025 (5)

Corporate income tax collection scope for non-resident enterprises:

Non-resident enterprises are subject to corporate income tax only on income derived or received from Indonesia.

Withholding tax for non-resident enterprises

The following payments made by a government organization, a resident taxable entity, an event organizer, a permanent establishment or any other representative of a non-resident enterprise to a non-resident enterprise other than a permanent establishment, regardless of the name and form of payment, payable or due, are subject to a 20% withholding tax:

(1) dividends;

(2) interest, including share premiums, dividend discounts and loan repayment deposits, of which the withholding tax rate for bond interest income is 10%;

(3) royalties, rents and other income related to the use of property;

(4) remuneration related to services, works and activities;

(5) prizes and awards;

(6) pensions and other periodic payments;

(7) premiums and other hedging transactions;

(8) income from debt forgiveness.

In addition, non-resident taxpayers other than permanent establishments are required to withhold 20% withholding tax on the assessed profits when transferring domestic property. Non-residents are also subject to a 20% withholding tax on the indirect transfer of domestic property through conduit companies or special purpose companies.

A 20% withholding tax is applicable to the after-tax income paid out by a permanent establishment of a non-resident enterprise, unless the profit is reinvested in the country.

The above withholding tax shall be treated as final tax unless it falls into the following circumstances:

(1) Withholding tax withheld on income similar to the business of the permanent establishment obtained by the head office in the location of the permanent establishment;

(2) Withholding tax withheld on non-resident enterprises or individuals that have become resident taxpayers or permanent establishments.

The excitement continues in the next issue…

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