• (021) 5290 5797

  • HOURS : MON-FRI 8.30 AM - 5.30PM

Contact Us
Menu Close

In-Kind Benefits and/or Enjoyment Tax is In Force Starting July 2023

In-Kind Benefits Tax is a tax imposed on the rewards of actual goods/non-cash received by individuals/employees for their services or works. In general, in-kind benefits tax is a levy on additional goods/facilities provided by the employer to the employee. In-kind benefits, or so-called fringe benefits, are all kinds of non-cash compensations received by the employees that are additional to their normal allowance or salary. In-kind benefits are usually given in connection with a certain position or reward for performance, for example: accommodation, transportation, traveling allowances, or employee stocks. 

Regulation of the Minister of Finance Number 66 of 2023 on Income Tax Treatment of Reimbursement or Compensation in Relation to Work or Services Received or Obtained in the Form of In-Kind Benefits and/or Incentives  (“MoF 66/2023”) is in force since July 1st, 2023. With the enactment of this new regulation, the previous legal framework regulating In-Kind Benefits i.e., Regulation of the Minister of Finance Number 3 of 2018 has now been repealed and replaced. 

In order to provide legal certainty for employers, reimbursement or compensation in connection with work or services in the form of in-kind benefits can be disbursed by the employer, as long as the reimbursement is the cost of obtaining, collecting, and maintaining income.

Banefit tax

Read More: Three New Types of Non-Tax Government Revenue (PNBP)

The Advantages of In-Kind Benefits Tax for Employers and Employees

With the enactment of Regulation of the Minister of Finance Regulation Number 66 of 2023, the employer can deduct the in-kind expenses from gross income. Meanwhile, for in-kind recipients, in-kind benefits are objects of Income Tax (PPh). Through this in-kind benefits tax, the employer is given the flexibility over all in-kind expenses, which is in line with the principle of ease of doing business in Indonesia.

Meanwhile for the employees, the current regulation does not change the rights of employees, but emphasizes that in-kind benefits received by employees are generally exempted from income tax. In addition to in-kind benefits as income that are exempted from income tax, employees will also benefit from the fact that companies will be more flexible in making expenses for In-Kind Benefits as facilities for employees.


Tax Exemptions for In-Kind Benefits Received by Employees

In-Kind Benefits Tax is imposed by taking into account the appropriate income value received by employees. Therefore, the government determines that several types of In-Kind Benefits are exempted from the imposition of the In-Kind Benefits Tax, with or without certain limitations.

The following are the types of In-Kind Benefits and their value limits that have been determined to be exempted from income tax in MoF 66/2023:

  1. Foods, food ingredients, beverages, or beverage ingredients provided for employees in the workplace without value limits, but if it is provided in the form of meal coupons for employees on out-of-town service, the value is limited to a maximum of 2 Million rupiah per month;
  2. In-Kind Benefits provided in certain locations, including in infrastructure and facilities provided for employees and their families at work locations/sites;
  3. In-Kind Benefits that must be provided by the employers to ensure the execution of work, including all the infrastructure needed for work, including those related to worker safety, health and/or security. This exemption only applies to developing areas that have inadequate infrastructure and/or difficult access. To obtain a tax exemption, the employer concerned must obtain approval from the Director General of Taxes or other appointed officials;
  4. In-Kind Benefits with certain types and limitations, including: In-Kind Benefits received by employees in 2022, places of worship, employee housing for a maximum of 2 Million rupiah per month, hampers/gifts received by employees on holidays;
  5. In-Kind Benefits that are funded/sponsored by the government and/or local government. 

ET Consultants are ready to assist you if you have questions regarding In-Kind Benefits Tax or other tax-related questions. We will help you with various licensing and other legal compliance services.


Read More: 12 Months to 15 Days of Process


ET Consultant is a Business Consultant and Legal Consultant Expert that provides support for local and multinational clients to start and manage their business operations in Indonesia. ET Consultant specializes in Business Incorporation, Licensing & Legal, Accounting & Taxes, Immigration, and Advisory Services.

Ready to find out more?

Excellent and Trusted Consultant (ET Consultant)
PPHUI Building Lantai 2 suite 210 Jl. H.R. Rasuna Said Kav. C-22 Kuningan
Jakarta Selatan, 12940 Indonesia.
Tlp : 021 5290 7039
Email : [email protected]

An Indonesian group advisory or consulting firm that provides Business and Legal Consultant for local and multinational client support for start-ups and managing business operations in Indonesia. ET Consultant provides a solid legal foundation with experience, reasonable cost, reliable corporate & business legal services with excellence, integrity, and trusted services for ease of doing business in Indonesia.

Share This

Copy Link to Clipboard