UMKM Tax Calculator

Free of PPh Final, yes — but only for individual taxpayers, and only for the UMKM PPh Final scheme. You still need an NPWP and must still file an annual return, even a nil one. The allowance doesn't extend to Perseroan Perorangan or cooperatives, which pay 0.5% from the first rupiah. The Rp500 million rule sits in Pasal 60(2) of PP 55/2022 and was not changed by PP 20/2026.

The 0.5% applies only to the excess above Rp500 million, not to your whole turnover. Example: Rp800 million of annual turnover as an individual. The taxable portion is Rp800 million minus Rp500 million = Rp300 million. Your PPh Final is Rp300 million × 0.5% = Rp1.5 million a year, or Rp125,000 a month. Many people wrongly multiply the full Rp800 million by 0.5%.

Three main things. The 7-year cap for individuals was removed, so the 0.5% rate can be used indefinitely while turnover stays under Rp4.8 billion. The scope narrowed: CV, Firma, regular PT, and BUMDes can no longer join as new entrants, with transitional rules for existing users. And rules on combining turnover across entities and family members were tightened. The Rp500 million allowance was retained.

Once turnover in a financial year reaches Rp4.8 billion, you must register as a taxable entrepreneur, then charge VAT to customers and remit it. You can also register voluntarily before hitting the threshold — usually because corporate customers require tax invoices. Don't wait until you've crossed it: late-registration penalties can be expensive.

For non-luxury goods and services the effective rate is 11%. Technically the rate is 12% applied to an alternative tax base of 11/12 of the sale price, which nets out to 11% (PMK 131/2024). The full 12% applies only to luxury items such as motor vehicles, luxury housing, and yachts. Because this has changed before and may change again, always check the official DJP source before making major decisions.