How To Calculat Individual Income Tax, In Detail And The Formula Is Not Complicated

Illustration of calculating income tax (Freepik)

YOGYAKARTA - The income tax (PPh) is one type of tax that must be paid by everyone. This tax is a responsibility for someone who already has an income. However, there are still many people who do not know how to calculate income tax.

The calculation of income tax must be understood by everyone who already has income. Payment of income tax is regulated in the Law on taxes. The law states that all income income is imposed on all forms of income, starting from wages, salary, allowances, honorariums, or other payments related to positions, services, occupations, to activities.

The income tax or income tax is imposed on every person who has a minimum income of IDR 4.5 million per month. This regulation applies to Indonesian citizens (WNI) who work domestically and in other countries. PPh payments are made once a year.

There are two categories of income tax, namely:

Individual income tax: income tax imposed on individuals or personally, be it employees, non-employees, or employers.

Business Entity PPh: Income tax imposed on a company or business entity.

The income tax rules are contained in Law Number 7 of 1983 concerning Income Tax.

Every tax-abiding citizen must make a PPh payment. To make payments, you automatically need to know how to calculate income taxes correctly. Calculation of income income includes all forms of income, such as salary, allowances, wages, honorarium, to other payments related to work.

Everyone bears a different income tax burden depending on the amount of income each earns. If the income is getting higher, the tax that must be paid is also greater.

How to calculate income tax is very easy. First, you need to calculate a net income in one year. See how much your Non-Taxable Income (PTKP) and Taxable Income (PKP) are. You will know how much income tax must be paid after calculating all these elements.

Based on Law no.36/2008 Article 6, the calculation of personal income tax refers to anad income in one year, including the allowance you receive. The total of all these incomes is the amount of gross or gross income.

After knowing how much gross, you need to calculate your total net income within one year. Net income is obtained from gross total minus mandatory costs, such as credit, pension fees, or debts.

After knowing the amount of net income, then you need to calculate the non-taxable income (PTKP). PTKP will be used as a reference for calculating PKP. Everyone has a different number of PTKP because it depends on the number of family members to be borne.

The Director General of Taxes sets the level of PTKP per year as follows:

The step to calculate PKP is quite easy. The number of PKP is known by calculating the net income minus the number of PTKP. After knowing the number of PKP, you just have to continue following the final income tax.

The last step you have to do is to calculate the PPh finally. This calculation refers to the percentage that has been regulated by the Director General of Taxes.

From the above calculation, you can find out how to calculate income tax, namely multiplying a net income with the appropriate percentage, for example, if your net income in one year is Rp. 60 million, then the income tax that you have to pay is Rp. 15% of the total income.

That's how to calculate individual income taxes that need to be known every Indonesian citizen who already has income. Tax counting is actually very easy and simple as long as you know clearly the source of income and income obtained.

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