The Most Accurate Way to Calculate the Latest Income Tax
Rancakmedia.com – In this article we will discuss about how to calculate income tax the latest, for those of you who don't know it, you can see the article that we have provided below until it's finished.
A good understanding of how to calculate income tax is very important for every taxpayer.
This can help taxpayers to avoid miscalculations that may result in payment of fines or administrative sanctions.
In addition, by understanding how to calculate income tax, taxpayers can take advantage of available tax deductions and credits to lower the amount of tax that must be paid.
What Is Income Tax
income tax is a tax imposed by the government on the income received by a person or business entity.
Income tax is an important source of state revenue and is used to finance various state activities, such as infrastructure, education, health, and so on.
Every citizen or business entity that earns income is obliged to pay income tax.
Income subject to tax can come from various sources, such as salary, honorarium, bank interest, royalties, and so on.
The income tax rate that must be paid depends on the amount of income earned.
Income tax also has strict regulations regarding submission of SPT (Notification Letter).
Every taxpayer must submit SPT on time and provide accurate income reports.
The government also provides tax deductions and credits to ease the tax burden that must be paid by taxpayers.
Therefore, it is important for every taxpayer to understand how to calculate income tax in order to avoid miscalculations that can result in the payment of fines or administrative sanctions.
In addition, by understanding how to calculate income tax, taxpayers can take advantage of available tax deductions and credits to lower the amount of tax that must be paid.
Definition of Tax Rates
The tax rate refers to the percentage or figure used to calculate the amount of tax to be paid by the taxpayer based on the amount of income earned.
Tax rates are usually set by the government and can differ from one type of tax to another.
Tax rates are usually used to determine the amount of tax that must be paid by taxpayers, both individuals and business entities.
Tax rates may vary depending on the type of income earned and the amount of income received.
In general, a higher tax rate will be applied to a higher income. Therefore, taxpayers who have higher income will be subject to higher taxes.
The tax rate charged is usually regulated by tax laws and overseen by tax authorities.
In understanding the tax rate, the taxpayer must carefully calculate the amount of income received and the applicable tax rate to avoid miscalculations and pay more tax than has been determined.
In addition, taxpayers must also pay attention to applicable tax regulations and consult with tax experts if necessary.
This will assist taxpayers in determining the amount of tax to be paid correctly and in accordance with applicable regulations.
Income Tax Rate for Indonesian Citizens
Income tax rates for Indonesian citizens may differ depending on the amount of income received and the tax status of the taxpayer.
The following are the applicable income tax rates in Indonesia for the 2023 tax year:
1. Final Income Tax
The following is the final income tax rate:
- The tax rate is 0.5% for income up to IDR 4.8 million per year
- The 1% tax rate is for income above IDR 4.8 million to IDR 60 million per year
- The 2% tax rate is for income above IDR 60 million to IDR 120 million per year
- The tax rate is 5% for income above IDR 120 million to IDR 720 million per year
- The tax rate is 7% for income above IDR 720 million per year
2. Non-final Income Tax
The following are non-final income tax rates:
- Tax rate 5% for income up to IDR 50 million per year
- The tax rate is 15% for income above IDR 50 million to IDR 250 million per year
- Tax rate 25% for income above IDR 250 million to IDR 500 million per year
- The 30% tax rate is for income above IDR 500 million to IDR 1 billion per year
- The tax rate is 35% for income above IDR 1 billion per year
Taxpayers can also get various tax deductions, such as deductions for education, health, and donations.
In addition, taxpayers can also take advantage of the withholding tax system that is imposed on certain sources of income, such as salaries and dividend payments.
In this case, the party paying the income is obliged to withhold tax and deposit it to the tax authority.
Income Tax Rates for Business Entities
Income tax rates for business entities may vary depending on the form of business entity and the amount of income received.
The following is the income tax rate for business entity applicable in Indonesia for the 2023 tax year:
1. Limited Liability Company (PT)
Following are the limited liability company (PT) tax rates:
- 22% tax rate for income up to IDR 50 billion per year
- The tax rate is 24% for income above IDR 50 billion per year
2. Cooperative
The following is the final income tax rate:
- 10% tax rate for income up to IDR 4.8 billion per year
- The 20% tax rate is for income above IDR 4.8 billion per year
3. Micro, Small and Medium Enterprises (MSMEs)
The following is the MSME income tax rate:
- The tax rate is 0.5% for income up to IDR 4.8 billion per year
- The 1% tax rate is for income above IDR 4.8 billion to IDR 50 billion per year
- The 2% tax rate is for income above IDR 50 billion to IDR 4.8 trillion per year
- The 3% tax rate is for income above IDR 4.8 trillion per year
4. Other Business Entities
The following are other business entity income tax rates:
- Tax rate 25% for income up to IDR 50 billion per year
- The 30% tax rate is for income above IDR 50 billion per year
Business entity taxpayers can also obtain various tax deductions, such as deductions for operational and investment costs.
In addition, business entities can also take advantage of a withholding tax system on certain sources of income, such as dividends paid to shareholders.
In this case, the business entity is obliged to withhold tax and deposit it to the tax authority.
How to Calculate Income Tax Correctly
As a tax-abiding citizen, you should know how to calculate income tax correctly.
The calculation itself refers to all forms of income, be it salary, wages, horarium, allowances, and other payments related to work.
The amount of PPh also depends on the amount of income you get. The more income, the higher the tax burden that must be borne.
To calculate it, here are the steps you need to understand:
First, you must calculate net income in one year first. Then, find out how much your Non-Taxable Income (PTKP) and also your Taxable Income (PKP) are.
After everything is calculated, then you can find out how much PPh must be paid.
1. How to Calculate Net Income in One Year
According to Law no. 36/2008 Article 6, how to calculate personal income tax refers to your income in one year, including allowances in it. All of these total revenues are included in gross or gross income.
Before calculating, from the gross it is necessary to find out how much the net income was in that one year.
Net income is obtained from the total gross less mandatory costs such as pension costs, loans or other debts.
2. How to calculate PTKP (non-taxable income)
After finding out how much your net income is in one year, the next step is to find out the PTKP. Later, this PTKP will be used to calculate the PKP.
The amount of PTKP for each person is different, depending on how many family members they are dependent on. The Director General of Taxes determines the level of PTKP per year as follows:
- Individual taxpayers, amounting to IDR 54 million.
- In addition, for taxpayers who are married, it is IDR 4.5 million.
- Additional for blood family members (maximum 3 people), Rp. 4.5 million.
3. How to Calculate PKP (Taxable Income)
How to find PKP is quite simple. After knowing the appropriate PTKP amount, all you have to do is reduce the amount of net income with the PTKP amount. Thus, you can proceed to how to calculate the final income tax.
4. How to Calculate PPh (Income Tax) for Indonesian Citizens
After successfully finding each point, the final step is calculating income tax.
How to calculate final PPh is based on the percentage that has managed to find each point, the final step is to calculate income tax.
The method for calculating final PPh is based on the percentage set by the Director General of Taxes, as follows:
- PKP below IDR 50 million is subject to PPh of 5%.
- PKP between IDR 50 million – IDR 250 million is subject to PPh of 15%.
- PKP between IDR 250 million – IDR 500 million is subject to PPh of 25%.
- PKP above IDR 500 million is subject to PPh of 50%.
From the calculation above, how to calculate PPh only needs to multiply net income by the appropriate percentage.
For example, your net income in one year is IDR 100 million, then the PPh that is charged is 15% of total income.
Example of PPh Calculation Simulation
To clarify how to calculate PPh correctly, the following is an example of a simulation of the calculation.
Example:
Bayu is a company manager with an estimated net income of IDR 80 million per year. He is not married, so he has no dependents on other family members.
How much income tax does he have to pay?
The first step is to calculate the PKP. Because Bayu was not married, he was included in the first category. So, PKP Bayu is:
PKP
= net income - PTKP
= IDR 80 million – IDR 54 million
= IDR 26 million
After the PKP is known, then calculate the PPh. Because Bayu's PKP is less than IDR 50 million, the PPh that is imposed is 5%. Thus, it can be calculated that:
income tax
= IDR 50 million x 5%
= IDR 2.5 million
Based on these calculations, Bayu must pay income tax of IDR 2.5 million per year.
Conclusion
Income tax is a tax imposed by the government on income received by a person or business entity.
Thus the information on how to calculate the latest most accurate income tax, I hope the article above can be useful and helpful for all of you.
