If your company pays income to a non-resident taxpayer in Indonesia, you must create an e-Bupot BP 26 in Coretax DJP and report it through SPT Masa PPh 21/26. Since January 2025, this process is mandatory under Income Tax Article 26 (PPh 26), with a default 20 percent rate on gross income unless a valid tax treaty applies.

We often advise foreign-owned companies and expatriate directors that compliance with the Directorate General of Taxes (DJP) is no longer optional or manual. Coretax centralizes the entire withholding workflow. If you fail to input the data correctly, your SPT Masa will not reconcile.

Let us break this down clearly and practically.

Understanding PPh 26 for Foreign Parties

PPh 26 applies to payments made to non-resident taxpayers who do not have a permanent establishment in Indonesia. The tax is calculated on gross income, not net profit.

Key characteristics:

• Default rate: 20 percent
• Object-based reporting using specific tax codes
• Mandatory electronic submission via Coretax DJP
• Integrated with SPT Masa PPh 21/26

If a foreign party qualifies for a reduced treaty rate, they must provide a valid Certificate of Domicile (SKD WPLN), which must be verified through the e-SKD system.

Without validation, Coretax will reject the treaty rate and automatically apply 20 percent.

Also read: Withholding Tax in Indonesia: Complete Guide for Foreigners

Step 1: Verify Prerequisites Before Creating e-Bupot

Before you create an e-Bupot BP 26, ensure:

1. The foreign recipient’s identity is complete, including passport number and country code.
2. The tax object code is correct. For example, services typically use 27-100-99.
3. SKD WPLN is validated in the DJP system if applying treaty benefits.
4. All transaction documents match invoice data.

Many compliance failures occur because companies skip this validation stage.

Step 2: Create e-Bupot BP 26 in Coretax

Log in to Coretax DJP using your PIC account or authorized role.

Navigate to:
e-Bupot > BP 26 – Bukti Pemotongan Wajib Pajak Luar Negeri
Click “Create eBupot BP26.”

You must complete the following sections:

Header

• Tax period in mm-yyyy format
• Status: Normal or Pembetulan

Choosing the wrong status often causes submission errors.

Income Recipient (Section A)

• Full name
• Address
• Country code (PER-11/PJ/2025 reference)
• Passport number

Incomplete identity data is the most common reason for validation failure.

Income Tax Withheld (Section B)

• Gross income
• Tax rate (20 percent default or treaty rate)
• Object code
• Auto-calculated tax

Ensure gross income matches the invoice exactly. Any mismatch will cause inconsistencies during SPT Masa reporting.

Withholding Agent (Section C)

• NPWP
• Signer name
• Digital verification via QR code

Always preview before signing digitally.

Also read; Indonesia Tax Rate for Foreigners: What You Need to Know

Step 3: Report Through SPT Masa PPh 21/26

After creating the e-Bupot, go to:

Surat Pemberitahuan SPT > Buat Konsep SPT
Select PPh Pasal 21/26
Choose the tax period
Click “Buat Konsep.”

Coretax automatically imports e-Bupot data into the SPT Masa.

You must:

• Review the summary and detailed records
• Ensure no underpayment or overpayment
• Pay any outstanding tax by the 20th
• Submit before the end of the following month

For example, February transactions must be reported by the end of March.

Common Errors in Coretax

We frequently see the following issues:

1. Incorrect tax object code
2. Invalid treaty facility due to unverified SKD
3. Passport or country code mismatch
4. Gross income not aligned with invoice
5. Cache-related system errors
6. Incorrect NPWP of withholding agent

Technical errors can also arise if the signer’s ID or passphrase is incorrect.

If the e-Bupot does not appear in SPT Masa, it usually indicates incomplete validation.

Also read; Coretax Compliance Checklist for Foreign-Owned Companies (PT PMA)

Best Practices to Prevent Rejection

• Validate SKD via e-SKD before applying treaty rate
• Cross-check invoice values and tax calculation
• Use preview before digital signature
• Reconcile e-Bupot with SPT Masa immediately
• Contact Coretax helpdesk if system issues persist

Accurate data entry ensures automatic SPT synchronization.

Why This Matters for Foreign-Owned Companies

If you operate a PT PMA or represent a foreign entity in Indonesia, PPh 26 compliance directly affects your tax risk profile. Errors can lead to penalties, audit triggers, or rejected filings.

Many expatriate directors underestimate how detailed Coretax validation rules are. The system cross-checks object codes, identity fields, and facility claims under PER-11/PJ/2025.

This is where structured tax compliance makes the difference.

At InvestinAsia, we guide foreign investors step by step. We ensure your PPh 26 reporting, e-Bupot creation, SPT Masa filing, and treaty validation align fully with DJP regulations. Our Indonesia tax consultant and compliance services are designed specifically for expatriates and foreign-owned companies who want clarity, not guesswork.

If you want your withholding process reviewed or fully managed, we are ready to assist you.

Contact us now for FREE consultation and get a special offer!

FAQs About Reporting PPh 26 in Coretax

What is the default PPh 26 rate for foreign parties?

The default rate is 20 percent of gross income unless a valid tax treaty applies.

When should PPh 26 be reported?

It must be reported through SPT Masa PPh 21/26 by the end of the following month.

Can treaty rates be applied automatically?

No. The Certificate of Domicile must be validated through the e-SKD system before applying treaty benefits.

What is the difference between BP 26 and BPNR?

BP 26 is generally used for personal service income to individuals, while BPNR applies to other types of non-resident income.

What happens if gross income is entered incorrectly?

Coretax may reject the submission or cause inconsistencies in SPT Masa, potentially leading to compliance risk.