What is Article 29 Income Tax
Article 29 Income Tax (PPh Pasal 29) is income tax that remains underpaid at year end. The figure appears when a taxpayer prepares the Annual Tax Return (SPT Tahunan) and the total tax due for the year exceeds all tax credits withheld, collected, or self-paid during the year.
The phrase "underpaid" often sounds alarming. In practice, PPh Article 29 is a normal outcome of Indonesia's self-assessment system: taxpayers compute their own annual tax liability, and a gap with credits already deposited is routine.
Legal Basis
The obligation to settle PPh Article 29 before filing the Annual Return is set out in Article 29 of the Income Tax Law as last amended by Law 7/2021 (UU HPP). Procedures and payment deadlines refer to Article 9 of UU KUP and MoF Regulation 242/PMK.03/2014.
The filing deadline for the Annual Return is set by Article 3 of UU KUP: 3 months after the end of the tax year for individual taxpayers, and 4 months for corporate taxpayers.
How to Calculate PPh Article 29
Base formula for PPh Article 29:
PPh Article 29 = Annual Tax Due
- Tax Withheld/Collected by Others (Articles 21, 22, 23, 24)
- Article 25 Installments Already Paid
- Principal of Tax Collection Letter for Article 25 (if any)
+ Foreign Tax Credit Refund from Prior Year (if any)
A positive result is underpayment (PPh Article 29). A negative result is overpayment, refundable under Article 28A or carried forward as compensation.
Rates and Payment Deadline
PPh Article 29 follows the tax rate applied in the Annual Return, not a separate rate. For individuals: progressive rates under Article 17 of the Income Tax Law (5% to 35%). For corporates: 22% standard rate or special regimes such as the 0.5% final MSME tax under GR 55/2022.
| Taxpayer | Payment Deadline | Filing Deadline |
|---|---|---|
| Individual | 31 March of the following year | 31 March of the following year |
| Corporate | 30 April of the following year | 30 April of the following year |
Payment must be made before the Annual Return is filed (Article 9 paragraph (2) of UU KUP).
How to Pay PPh Article 29
- Compute PPh Article 29 based on the prepared Annual Return.
- Generate a billing code via DJP Online or Coretax. Select tax type 411125 (individual) or 411126 (corporate) with deposit code 200 for PPh Article 29.
- Pay via partner bank, ATM, internet banking, mobile banking, or any marketplace with a tax payment menu, using the billing code.
- Keep the State Revenue Receipt (BPN) as proof of payment.
- Enter the payment amount and BPN number in the Annual Return, then file the SPT through Coretax.
Worked Example
Budi is a full-time employee who also runs a part-time consulting practice. For tax year 2025:
- Salary income: Rp180 million, with PPh Article 21 withheld of Rp10 million
- Net consulting income: Rp120 million, with PPh Article 23 withheld of Rp2.4 million
- No PPh Article 25 installments (Budi is a new taxpayer on the consulting side)
Budi's Annual Return computation (single, no dependents PTKP of Rp58.5 million):
- Total net income: Rp180 million + Rp120 million = Rp300 million
- Taxable income: Rp300 million : Rp58.5 million = Rp241.5 million
- Article 17 tax due: (5% x Rp60 million) + (15% x Rp181.5 million) = Rp3 million + Rp27.225 million = Rp30.225 million
- Tax credits: Rp10 million + Rp2.4 million = Rp12.4 million
- PPh Article 29: Rp30.225 million : Rp12.4 million = Rp17.825 million
Budi must deposit Rp17,825,000 as PPh Article 29 no later than 31 March 2026 before filing Form 1770.
Penalties for Late Payment
Late payment of PPh Article 29 triggers interest under Article 9 paragraph (2a) of UU KUP, computed from the due date to the settlement date, capped at 24 months. The monthly interest rate is set by the Minister of Finance under Article 8 paragraph (2a) and Article 19 paragraph (1) of UU KUP.
Late filing of the Annual Return is subject to an administrative fine (Article 7 of UU KUP): Rp100,000 for individuals and Rp1,000,000 for corporates.