Corporate Income Tax Withholding Obligations of Non-resident Enterprises丨Indonesian Tax Guide 2025 (8)-熊猫出海

Corporate Income Tax Withholding Obligations of Non-resident Enterprises丨Indonesian Tax Guide 2025 (8)

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This issue's introduction

Corporate income tax

Withholding obligations of non-resident enterprises

Chapter 1 Corporate Income Tax

Withholding obligations of non-resident enterprises

For the following matters, the payer needs to withhold and pay taxes in accordance with regulations:

(1) Wages, salaries, remuneration and other work expenses paid by employers (including individuals and companies, but excluding foreign embassies and designated international organizations) to Indonesian employees, workers or other persons;

(2) Pension funds for pension payments;

(3) Wages, salaries, remuneration and any other work-related payments made by financial personnel in any name (except public funds);

(4) Remuneration or other payments made by any company (private or state-owned) for any services provided by any expert or association of experts engaged in self-employment as a resident taxpayer;

(5) Dividends, interest, rent, royalties and other specific service fees paid by a resident company, cooperative, foreign company or permanent establishment of a state-owned company to an Indonesian resident (non-bank);

(6) Specific payments made by a resident individual or association appointed as a tax collector by the Tax Bureau to an Indonesian resident;

(7) Payments made by a resident individual, resident company, foreign company or permanent establishment of a state-owned company to a non-resident of Indonesia Dividends, interest, rent, royalties, service fees, proceeds from the sale of shares of non-listed companies and insurance premiums;

(8) Profits of a permanent establishment in Indonesia paid to its overseas head office after paying income tax;

(9) Salaries, wages and other in-kind payments made to Indonesian residents by a foreign representative office that does not constitute a permanent establishment in Indonesia under the relevant tax treaty (arrangement);

(10) Prepayments of income tax on domestic product sales by designated manufacturers of paper, steel, cement, pharmaceuticals and automotive products to distributors;

(11) Withholding taxes on imports of goods and exports of coal, steel and non-steel minerals by foreign exchange banks and the Directorate General of Domestic Excise Tax (DGCE), except for taxpayers with contracts for work;

(12) Financial personnel of the central government, local governments and government agencies responsible for paying for the purchase of goods;

(13) Financial personnel using the prepayment mechanism to pay for the purchase of goods;

(14) Officials responsible for using the government budget to pay for goods through the direct payment mechanism (Mechanism). Direct Payment of a third party for purchases;

(15) State-owned enterprises that are wholly or mostly owned by the state;

(16) State-owned enterprises reorganized by the government through share transfer;

(17) Payments for goods and materials purchased by certain business entities directly owned by state-owned enterprises for their business purposes;

(18) Domestic sales by sales agents of automobile brand holders, agents of automobile brand holders and general importers of automobiles;

(19) Sales of fuels and lubricants (in the form of oil and gas) by manufacturers or importers of fuels and lubricants;

(20) Raw materials purchased for industrial or export purposes by companies and exporters engaged in forestry, planting, agriculture, animal husbandry and fisheries.

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