HR glossary
HR and payroll terms in Indonesia, explained
The words that show up on every payslip and HR policy in Indonesia, in plain language.
- PPh 21
- Income tax on employment income, withheld by the employer every month and reported to the tax office.
- TER (Tarif Efektif Rata-rata)
- The average effective rates from PP 58/2023 used to withhold PPh 21 each month. The rate depends on the TER category and the monthly gross.
- PTKP
- Non-taxable income, set by marital status and number of dependants (TK/0 to K/3). It decides an employee's TER category: A, B or C.
- Article 17 true-up
- In the last tax period of the year (usually December), PPh 21 is recalculated with the progressive Article 17 rates and the difference is settled.
- PPh 26
- Withholding tax for non-resident employees, normally 20% of gross unless a tax treaty applies.
- BPJS Kesehatan
- National health insurance. 5% of wages up to a cap: 4% paid by the company and 1% by the employee.
- BPJS Ketenagakerjaan
- Employment social security: JHT (old-age savings), JP (pension), JKK (work accident) and JKM (death benefit).
- JHT
- Old-age savings: 3.7% from the company and 2% from the employee, with no wage cap.
- JP
- Pension programme: 2% from the company and 1% from the employee, on wages up to a cap that is indexed every March.
- THR
- The religious holiday allowance, at least one month's wage, prorated for employees with less than twelve months of service.
- PKWT
- A fixed-term employment contract.
- PKWTT
- A permanent employment contract.
- Pesangon
- Severance pay on termination, calculated from length of service. Its final PPh 21 is taxed separately.
- Paklaring
- The employment reference letter an employer issues when an employee leaves.
- PDO
- Day off in lieu, given when an employee works on a scheduled day off or public holiday.
- Service charge
- A charge on guest bills in hotels and restaurants, pooled and shared with employees.
- UMK
- The regency or city minimum wage, set every year.
- Coretax and e-Bupot
- The tax office's system and the electronic withholding slips (BPMP, BP21, BP26, BPA1) employers file for PPh 21.
- Tapera
- Tabungan Perumahan Rakyat, the public housing savings programme. Since the Constitutional Court ruling of 29 September 2025, participation is no longer mandatory for private-sector workers, and the law is being rewritten.
Calculate this for every employee, every month
Stavis runs this calculation for your whole payroll, explains every figure, and produces the Coretax files.
