If your Bali tourism business qualifies for the 2026 payroll-tax incentive, the benefit belongs in the employee's pay

PPh 21 DTP means that the Indonesian government bears an eligible employee's payroll income tax. The employer must pass that amount to the employee and report it; the employer cannot keep it as a saving.

Finance Ministry Regulation PMK 105/2025 makes a 2026 government-borne payroll income-tax incentive available to certain employees of employers whose main tax-administration business classification is one of the listed codes in footwear, textiles and garments, furniture, leather, or tourism. A Bali villa operator is not eligible merely because it describes itself as a tourism company. The employer code, the employee's identity and pay conditions, the cash payment, the withholding evidence and every monthly return all have to align.

Start with the employer, not the payslip

The first test is the employer's main business classification (KLU) in the Directorate General of Taxes (DJP) database:

• for an employer already registered before 1 January 2026, the relevant main code is the code in the tax database on 1 January 2026;
• for an employer first registered during 2026, it is the main code on its registration date; and
• that code must appear in Appendix A to PMK 105/2025.

The regulation includes tourism among the eligible sectors and its appendix must be checked code by code. A secondary tourism activity, a description on an online travel agency (OTA), a brand name, or a business-activity code (KBLI) added later is not enough to override the main code fixed by the regulation.

This matters during the KBLI 2025 transition. Do not "fix" an eligibility problem by changing a code on paper. First reconcile the actual activity, the Business Identification Number (NIB), the record in the Online Single Submission licensing system (OSS), and the main KLU held by DJP. Then obtain a written tax position.

Then test each employee

For a permanent employee, the regulation requires:

• an Indonesian taxpayer number (NPWP) and/or population identity number (NIK), administered by the civil-registration authority Dukcapil and integrated with the DJP system;
• fixed and regular gross income of no more than Rp10 million in January 2026 if already employed, or in the first month of work if hired during 2026; and
• no other PPh 21 DTP incentive under another tax rule.

For a non-permanent employee, the identity and no-duplicate-incentive conditions also apply. PMK 105/2025 then distinguishes remuneration paid daily, weekly, per unit or piecework from remuneration paid monthly. The regulation states a Rp500,000 amount for the first category and no more than Rp10 million for monthly remuneration. The exact application of the Rp500,000 wording to a real payroll pattern must be confirmed by a qualified Indonesian tax adviser before treating a payroll case as eligible.

Income already subject to final income tax under another regime is excluded.

What the employer does

The normal PPh 21 payroll-tax calculation is still performed. The qualifying amount is then borne by the government and must be paid directly to the employee when the income is paid. It is not retained as employer margin and it is not replaced by a future credit. For example, if the normal calculation shows Rp300,000 of eligible PPh 21 for a month, the employer adds that Rp300,000 to the employee's cash payment and records it in that month's return.

The employer must:

1. calculate the PPh 21 correctly for the period;
2. show the government-borne amount in the payroll evidence;
3. pay that amount to the employee in cash with the salary or wages;
4. issue the required withholding evidence; and
5. report the use of the incentive in each monthly PPh 21/26 return.

An annual reconciliation does not turn excess government-borne PPh 21 into a cash refund to the employee. An employer overpayment derived from the incentive also cannot be refunded or carried forward under this facility.

Missing the reporting deadline can cancel the benefit

The facility covers the January to December 2026 tax periods. Returns and permitted corrections for those periods count as incentive reporting only if submitted by 31 January 2027. If the reporting falls outside that limit, the regulation says the incentive is not granted and the employer must deposit the PPh 21 that should have been withheld.

That makes this a monthly-control issue, not an article to revisit at year-end.

A practical monthly control file

Keep one row per employee per month with:

• employment status and start date;
• NPWP/NIK integration confirmation;
• the January or first-month fixed-and-regular-income test;
• current gross income and excluded final-tax income;
• calculated PPh 21 and the DTP amount paid to the employee;
• payment evidence, withholding evidence and return receipt; and
• the person who checked the row, any exception and any correction.

Never upload raw NIKs, payroll files or bank records into a public website checker. The free tool should provide an initial eligibility check and a document list. The accountant should perform the calculation in a protected system.

Questions owners usually ask

My company operates villas. Is it automatically eligible? No. Check the main KLU recorded by DJP on the applicable date against Appendix A. "Tourism" as a commercial description is not the legal test.

Can the company keep the tax saving? No. The government-borne amount must be paid in cash to the qualifying employee.

Is every employee under Rp10 million eligible? No. Employment category, identity integration, the specified reference-month test, excluded income and duplicate incentives still matter.

Can I add a tourism code now and claim January? Do not assume so. The regulation freezes the relevant main KLU at 1 January 2026 for pre-existing employers.

Can the calculator tell me the exact benefit? Only after the payroll inputs and tax treatment have been validated. The public tool should not replace the monthly PPh 21 calculation.

sources checked: 15 July 2026 · facility periods: January to December 2026 · reporting correction limit: 31 January 2027

Primary source: PMK 105/2025, Directorate General of Taxes. General information only; not tax, payroll or employment advice.

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