The tax calculation for internship employees often creates confusion, particularly during the implementation of PMK 168, where no specific tax object code was available for interns. Previously, many assumed that internship employees fell under the Activity Participant category with tax object code 21-100-13, which applies to individuals who receive payment only once. However, in practice, many interns receive periodic compensation. As a result, their reporting has often been categorized as Non-Permanent Employees/Freelancers under tax object code 21-100-03.
Currently, with the implementation of Coretax, there has been a reclassification based on the latest regulations, which introduces a separate tax object code category specifically for internship employees. This article will explain:
The differences in internship classification under the PMK 168 implementation in DJP Online and Coretax.
The impact of changes in the tax object code classification for internship employees, including tax calculation simulations based on the latest regulations.
A. Internship Employee Classification in DJP Online vs. Coretax
1. DJP Online (PMK 168)
In DJP Online (based on PMK 168), there is no specific tax object code designated for internship employees. As a result, many companies classify interns under Non-Permanent Employees using tax object code 21-100-03. However, in principle, if an intern receives payment only once (for example, an allowance at the end of the internship period), the appropriate tax object code should be 21-100-13 (Activity Participant). In practice, most interns receive periodic payments (monthly or weekly). Therefore, they are more commonly reported as Non-Permanent Employees, even though this classification is not entirely accurate.
You can read more about the PPh 21 calculation for Non-Permanent Employees (Freelance/Interns) paid monthly here.
2. Coretax (Latest Regulation)
In the Coretax system, the classification for Non-Permanent Employees is now more detailed compared to the previous rules in DJP Online. This change aligns with payment structures and income amounts, and also introduces a specific tax object code for internship employees — which previously was not clearly separated. In the past, this often caused confusion because the treatment was similar to that of freelance workers. Below is the explanation:
Tax Object Code 21-100-30
Assigned to daily, weekly, or piece-rate workers with the condition that: The gross income exceeds IDR 2.5 million per day. Example: A freelance designer who is paid IDR 3 million for a one-day project.
Tax Object Code 21-100-35
Assigned to workers who receive monthly payments, regardless of the income amount. Example: A contractor who receives IDR 6 million per month for four months.
Tax Object Code 21-100-16 (Specifically for Internship Employees)
Coretax provides a special tax object code 21-100-16 for internship employees, separating them from the Non-Permanent Employee/Freelance category. Example: A company pays an intern IDR 4 million per month for six months.
B. Impact of Code Changes on Tax Calculations
Differences in tax object code classifications between the DJP Online system and Coretax significantly affect the tax withholding calculation method for internship employees. Below is an example illustrating the difference in tax calculations for interns under Code 21-100-03 in DJP Online and Code 21-100-16 in Coretax.
1. Tax Calculation for Internship Employees Using Code 21-100-03 in DJP Online
Previously, in DJP Online, if an internship employee was reported under tax object code 21-100-03, the tax calculation applied the Average Effective Rate (TER) and Article 17 tax rates, depending on the payment mechanism and the amount of wages received by the employee.
Example:
Employee A, with a taxpayer status of TK/0, works as an internship employee and receives a salary of IDR 1,000,000 per month. Based on the tax calculation rules in DJP Online for tax object code 21-100-03, Employee A is not subject to tax, because the income is below IDR 5.4 million, which still falls under the 0% Average Effective Rate (TER) bracket.
2. Tax Calculation for Internship Employees Using Code 21-100-16 in Coretax
Currently, in Coretax, the tax calculation applies the progressive tax rates under Article 17 of the Income Tax Law (UU PPh). These rates are determined based on taxable income brackets, without considering the employee’s taxpayer status.
Example:
Employee A, with a taxpayer status of TK/0, works as an internship employee and receives a salary of IDR 1,000,000 per month. Based on the tax calculation rules in Coretax for tax object code 21-100-16, Employee A is subject to tax calculated as 5% × IDR 1,000,000 = IDR 50,000, in accordance with the first progressive tax bracket under Article 17.