Last updated: 11 October 2026 · Rates checked against: PwC Worldwide Tax Summaries — Indonesia, reflecting PPh Pasal 4(2)
Reviewed by Zia Shahid, Buzdy Banking Editor · Our methodology
In this guide
In Indonesia the bank settles the tax on your deposit interest for you, at a single rate, and that is the end of it.
Interest on time deposits and savings with Indonesian banks is subject to a 20% final income tax.
Because it is final, it is not combined with your other income and the tax withheld cannot be credited.
PwC: "Interest income on time deposits and savings with Indonesian banks or their overseas branches ... are currently subject to final income tax at rate of 20%."
What "final" means here
The bank withholds the tax when it pays the interest and remits it. The income is not added to your annual income tax calculation, and the amount withheld is not an advance payment you can set against something else. What reaches your account is what you keep.
Small deposits
Indonesian rules have long carried an exemption for very small deposits — the commonly cited figure is a principal not exceeding IDR 7,500,000, and not artificially split to stay under it. PwC's summary does not state a threshold, so confirm the current position with your bank or the Directorate General of Taxes before relying on it.
Which accounts
The rule is described as covering time deposits and savings with Indonesian banks, including their overseas branches.
Frequently asked questions
Do I declare deposit interest in my annual return?
It is a final tax, so the income is not combined with other income in the annual calculation.
Can I claim the 20% back?
No. A final tax is not creditable.
Is there a minimum before tax applies?
An exemption for small deposits has long existed in the regulations. Confirm the current threshold with the bank or the tax office.
Does it apply to foreign currency accounts at an Indonesian bank?
The rule is framed around deposits with Indonesian banks. Check the treatment of your specific product with the bank.
Sources
- PwC Worldwide Tax Summaries — Indonesia, income determination
- Direktorat Jenderal Pajak — PPh Pasal 4 ayat (2)
This is information, not tax advice. The figures above were checked against the source named at the top of this page on 11 October 2026. Tax rules change, usually with each annual budget. For a decision about your own money, speak to a qualified tax adviser in your country.
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