PPh 25 in Indonesia: Monthly Corporate Tax Instalments

PPh 25 is the monthly instalment a company pays towards this year’s corporate income tax in Indonesia. Its full name is Pajak Penghasilan Pasal 25, income tax under Article 25 of the Income Tax Law, and each payment is an angsuran, an instalment (PPh 25 badan when a company pays it). The figure is last year’s tax, less the tax others withheld or collected on the company’s income, divided by twelve (Income Tax Law, Article 25(1)). It is paid by the 15th of the following month, and paying it also files it.

How PPh 25 is worked out

The starting point is the income tax due on last year’s annual return. From it come the tax withheld from the company’s income under Articles 21 and 23 of the Income Tax Law (PPh 21 and PPh 23), the tax collected under Article 22 (PPh 22), and any foreign tax the company may credit.

What is left, divided by twelve, is each month’s instalment. For a part year, divide by the number of months instead. The rules are in Income Tax Law Article 25(1) and PMK 81/2024 (Peraturan Menteri Keuangan, a Minister of Finance regulation) Article 226(1).

Description	IDR
Tax due on last year's return	600,000,000
Tax collected (PPh 22)	(30,000,000)
Tax customers withheld (PPh 23)	(90,000,000)
Balance	480,000,000
Monthly instalment 480,000,000 ÷ 12	40,000,000

Until the new annual return is filed, the company keeps paying the instalment for the last month of the year before (Income Tax Law, Article 25(2)). Once the new return is in, the new figure takes over. The instalments paid during the year are credited on the next return, and any balance is paid before it is filed (Article 29). Filing the corporate return each year is therefore what resets PPh 25.

If the tax office issues an assessment for last year, the instalment is worked out again from the assessment, starting the month after it is issued (Article 25(4)). A late or extended return has its own rule.

While a return is late, the old instalment continues to be paid; during an extension, the provisional figure in the extension notice is paid. Once the return is filed, the new figure applies from the month of the filing deadline (PER-11/PJ/2025, Peraturan Direktur Jenderal Pajak, the Director General of Taxes’ regulation on tax returns, Articles 116 and 117).

What is left out of the calculation

A loss carried forward from earlier years is deducted from last year’s taxable profit before the tax is worked out, so the instalment is smaller (PER-11/PJ/2025, Article 114(1) and (2)).

One-off income is left out too. A currency gain or a gain on selling an asset, where neither comes from the main business, and other one-off income do not raise this year’s instalments (Articles 113(5) and 115(2)).

When the instalment is nil

In the cases below the instalment is nil, and a nil instalment needs no monthly PPh 25 report (PMK 81/2024, Article 171(11)).

A PT (perseroan terbatas, a limited company) registered after PP 20/2026 (Peraturan Pemerintah, a government regulation) came into force on 22 April 2026 is taxed under the general rules from the start, so it is a new company for this purpose. A company that began on the final tax on turnover, a flat percentage of revenue in place of ordinary corporate tax, is treated the same way in the first year it leaves that regime.

Asking for a lower instalment

When a company’s business or activities change, it can ask its tax office to lower the instalment. After at least three months of the year, it must show that this year’s tax looks set to be under 75% of the tax the instalment is based on. The request also needs the last two annual returns, and the last three monthly VAT (value added tax) returns that were due, to have been filed (PER-11/PJ/2025, Article 119(1)).

We help clients prepare and file the request. The company supplies the reasonable grounds for a lower figure, and the tax office decides, so acceptance is not guaranteed.

1. 1
   After three months

   Forecast the tax

   With the request go the forecast and the proposed instalments for the rest of the year.

2. 2
   Online or on paper

   Submit it

   It goes through the Taxpayer Portal, or to the tax office (Article 119(2) to (4)).

3. 3
   Within 30 days

   The decision

   If the tax office does not decide within 30 days of the receipt, the request is treated as accepted (Article 119(7) and (8)).

4. 4
   Rest of the year

   Pay the new figure

   The lower instalment is paid for the months left in the year.

If this year’s tax looks set to be more than 125% of the tax the instalment is based on, the instalment is recalculated for the remaining months (Article 120(1)).

Paying and reporting

PPh 25 is paid by the 15th of the month after the month it is for (PMK 81/2024, Article 94(2)(f)). When the 15th falls on a weekend or a public holiday, the payment can be made on the next working day (Article 100). The date sits with the other monthly taxes on our compliance calendar.

An instalment paid late carries interest for each month, at a monthly rate set by the Minister of Finance (the General Provisions and Tax Procedures Law, or KUP Law, Article 9(2a) and (2c)). How that interest is worked out, and how a bill for it arrives, is covered in our note on paying or filing tax after the deadline.

What this means for you

PPh 25 needs attention at two moments: when each new annual return resets the figure, and on the 15th of each month a payment is due. Monthly PPh 25 is part of our monthly tax compliance, alongside the withholding taxes: depending on the scope we agree, we pay the instalment or tell you what to pay. The annual return itself is a separate engagement.