Tax Guide for Stock and Mutual Fund Investors in Indonesia

Summary

Stock investors in Indonesia pay final income tax on two main income types: capital gains from stock sales on the Indonesia Stock Exchange (IDX) and dividends from domestic or foreign issuers. Both are subject to final PPh at flat rates — withholding at source in most cases — so most investors do not owe additional tax at filing. This guide explains the rates, withholding mechanics, and how to report investment income in SPT 1770.

How Stock Investment Income Is Taxed

Indonesian stock investors face three distinct tax events:

1. Sale of listed shares on IDX — Final PPh at 0.1% of gross transaction value, withheld by the securities firm (broker) per PP No. 41 Tahun 1994 as amended by PP No. 14 Tahun 1997.
2. Dividends from domestic listed companies — Final PPh at 10% of gross dividend under PP No. 19 Tahun 2009 (as amended; rate reduced to 0% for certain reinvested dividends under UU HPP).
3. Dividends from foreign companies — Subject to PPh 26 at 20% or reduced rate under applicable tax treaty.

Key Regulations

• PP No. 41 Tahun 1994 jo. PP No. 14 Tahun 1997 — Final PPh 0.1% on gross value of listed share transactions.
• PP No. 19 Tahun 2009 — Final PPh 10% on dividends received by individual taxpayers from domestic companies.
• UU No. 7 Tahun 2021 (UU HPP) — Article 4 paragraph (3) letter f: dividends reinvested in Indonesia within a specified period are exempt from PPh.
• PMK No. 18/PMK.03/2021 — Implementing rules for the dividend reinvestment exemption.
• UU No. 36 Tahun 2008 (UU PPh) — Article 26: 20% withholding on foreign-sourced dividends; reduced by applicable P3B (tax treaty).
• PER-43/PJ/2020 — Procedures for claiming treaty benefits (DGT-1/DGT-2 forms).

Tax on Share Sales (Capital Gains)

Capital gains from selling listed IDX shares are taxed at a flat 0.1% of gross transaction value (not profit). This is a final tax — meaning regardless of whether the sale resulted in a gain or loss, 0.1% of the selling price is collected.

The tax is automatically withheld by the securities broker at the time of each sell transaction. No separate payment or declaration is required.

Example:

• Sell 10,000 shares of BBCA at IDR 9,500/share = IDR 95,000,000 proceeds
• PPh Final = 0.1% x IDR 95,000,000 = IDR 95,000

This is deducted automatically. The investor receives net proceeds of IDR 94,905,000.

For unlisted shares (non-IDX), capital gains are not subject to final PPh. Instead, they are included in general taxable income and taxed at progressive rates under Article 4(1) UU PPh.

Founder Shares

Founders of companies going public may elect to pay final PPh at 0.5% of the IPO price for all shares owned before listing (PP 14/1997). This election must be made within 1 month after the IPO date.

Tax on Dividends

Dividends from Indonesian Companies

Under PP 19/2009, dividends received by individual taxpayers from domestic companies are subject to final PPh at 10% of gross dividend amount. Withholding is done by the paying company at dividend payment date.

Reinvestment Exemption (UU HPP): If dividends are reinvested in Indonesia within 3 years of receipt — into eligible instruments including Indonesian capital market instruments, government bonds, direct equity, or business activity — the dividend is exempt from PPh. PMK 18/2021 governs the implementation; reinvestment must be documented and reported.

Example:

• Dividend received: IDR 20,000,000
• Without reinvestment: PPh 10% = IDR 2,000,000 (withheld by issuer)
• With qualifying reinvestment: PPh = IDR 0

Dividends from Foreign Companies

Foreign-sourced dividends are subject to PPh 26 at 20% of gross amount, or reduced rate per applicable P3B (tax treaty). Indonesia has tax treaties with over 70 countries. Treaty benefits are claimed via DGT-1 or DGT-2 forms (PER-43/PJ/2020).

If no treaty applies, the investor pays 20% on the gross dividend.

Reporting in SPT Tahunan

Even though most stock investment taxes are final and withheld at source, investors must still declare investment income in SPT 1770 (Lampiran IV — Final Income).

Checklist for SPT filing:

1. Annual brokerage statements (recap of sell transactions and PPh withheld)
2. Dividend receipts (showing 10% PPh withheld)
3. Foreign dividend documentation (for PPh 26 credit or treaty claim)
4. Reinvestment proof (if claiming dividend exemption under PMK 18/2021)

Filing deadline: March 31 each year via DJP Online.

Mutual Funds and ETFs

Capital gains from mutual fund redemptions are not subject to PPh at the individual level (Government Regulation exempts capital gains in mutual fund units). Dividend distributions from equity mutual funds distributed to individual investors are subject to PPh based on the underlying asset.

For ETFs (Exchange Traded Funds) listed on IDX, the same 0.1% final PPh applies on sell transactions, same as individual stocks.

Real-World Example

Retail investor, Jakarta. Tax year 2025:

Event	Amount	Tax Rate	PPh
Sell TLKM shares (IDX)	IDR 50,000,000 proceeds	0.1% final	IDR 50,000
Dividend from BBRI	IDR 8,000,000	10% final	IDR 800,000
Sell GOTO shares (IDX)	IDR 12,000,000 proceeds	0.1% final	IDR 12,000
Total PPh paid			IDR 862,000

All taxes were withheld at source. SPT 1770 declares these amounts as final income. No additional payment due.