Types of Tax Payments That Micro, Small, and Medium Enterprises (MSMEs) Need to Know

Jakarta, Ideatax -- Tax is an unavoidable obligation for every business actor, including Micro, Small and Medium Enterprises (MSMEs). Knowing the various types of tax payments is important to fulfill tax obligations efficiently.

 

For those of you who are part of the MSME community and are still finding out about the types of tax payments, this article will provide the necessary explanation. Let's explore more deeply the world of taxation that is relevant to MSMEs
 

Types of Tax Payments for MSMEs

Different types of businesses have different tax obligations. In MSMEs, tax only applies to those who have reached the turnover limit set for tax payment.

As an MSME owner, there are two types of taxes that you need to pay monthly or annually. Here's the explanation:

 

1. Monthly Tax

Monthly tax is a type of tax that must be reported and paid every month via a Periodic Tax Return (SPT).

Monthly tax types include:

• Income Tax Article 21 (PPh Article 21): Must be paid by MSMEs who have employees who are subject to income tax. This tax is deducted from wages, salaries, honorarium and employee benefits.
• Income Tax Article 23 (PPh Article 23): More aimed at medium-sized businesses and includes payments for interest, royalties, bonuses, gifts, rent and certain services.
• Income Tax Article 26 (PPh Article 26): Must be fulfilled when making transactions with Overseas Taxpayers (WP) and includes payments of dividends, salaries, interest, rent, royalties and the like.
• Income Tax Article 4 paragraph (2): Related to rental transactions, transfer of rights to land/buildings, and construction businesses.
• MSME Final Income Tax based on PP 23/2018: This is a tax incentive for MSMEs with certain gross turnover.
• Value Added Tax (VAT): Mandatory for Taxable Entrepreneurs (PKP), including MSMEs with a turnover of under IDR 4.8 billion that have been confirmed as PKP.

 

2. Annual Tax

Annual tax is a tax obligation that must be paid or reported every year, also known as Annual Tax. MSMEs in the medium scale business category will be subject to Corporate Income Tax (Corporate PPh). This tax can be paid in one annual payment or through Article 25 Income Tax installments which are paid monthly.

 

That is the discussion regarding the types of tax payments that MSMEs should know about. Understanding this is not easy, especially for those with limited resources.

 

However, don't worry!

Now, Ideatax is here as a reliable solution to overcome tax challenges in the MSME business. With a team of competent tax experts, we are ready to help manage your taxes efficiently and in accordance with applicable regulations.

Let's entrust your business taxation to us, and enjoy the benefits of the best tax expert services for the growth and success of your MSME.