Article 23 Income Tax (PPh 23)
PPh 23 (Article 23) is withholding tax on dividends, interest, royalties, prizes, rent, and technical/management/consulting fees paid by entities to domestic taxpayers or PEs. Governed by Article 23 of the Income Tax Law and PMK No. 141/PMK.03/2015. Rates: 15% on dividends, interest, royalties, and prizes; 2% on rent and certain service fees. Without an NPWP, rates double. PPh 23 is non-final and can be credited by the income recipient on their annual return.
This article is for education, not tax advice.
Example
PT A rents a warehouse from CV B for Rp 100 million. PT A withholds PPh 23 = 2% x Rp 100 million = Rp 2 million. CV B receives Rp 98 million and credits the Rp 2 million on its annual return.
Source: Article 23 UU PPh No. 36/2008; PMK No. 141/PMK.03/2015
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