Payslip
Learn what a payslip is, what it shows and how to create one for your employees in Indonesia.
Published Wednesday 30 September 2026
Table of contents
Key takeaways
- A payslip, or slip gaji, shows what your employee earned and what they took home after deductions
- Typical deductions are income tax (PPh 21) plus the employee’s share of BPJS Kesehatan and BPJS Ketenagakerjaan contributions
- Gross pay minus deductions equals net pay, the amount that lands in your employee’s bank account
- Issuing a slip every payday and keeping digital copies means your records are ready when staff or the tax office ask questions
What is a payslip?
A payslip is a document you give an employee each payday that shows their total earnings, less deductions such as tax. In Indonesia it’s usually called a slip gaji, while the law uses the formal term bukti pembayaran upah, or proof of wage payment.
Think of it as a receipt for wages. Your employee can see exactly how you arrived at the amount in their bank account, which answers pay questions before they’re asked.
Are payslips mandatory in Indonesia?
Yes. Under Article 53(2) of Government Regulation (PP) 36/2021 you must give each employee proof of payment detailing their wages when you pay them.
The 2023 amendment, PP 51/2023, focused on minimum wage formulas, so Article 53 still applies as written. That means even a business with one employee needs to issue a slip with every pay run.
What a payslip shows
PP 36/2021 structures wages around a basic wage (upah pokok) plus fixed allowances (tunjangan tetap), variable allowances (tunjangan tidak tetap) or both. Alongside those wage lines, a typical slip includes:
- the employee’s name, job title, employee number and pay period
- earnings for the basic wage and each allowance
- overtime pay (upah lembur) for extra hours worked
- the religious holiday allowance (tunjangan hari raya, or THR) in the month you pay it
- deductions for income tax (PPh 21) and the employee’s share of social security (BPJS) contributions
- employer contributions you pay on top of wages
- net pay and the date you paid it
You can also list work expense reimbursements and remaining annual leave. Showing leave on each slip saves your staff from asking you for their balance.
Common payslip deductions in Indonesia
Most deductions come from PPh 21 (Pajak Penghasilan Pasal 21) and the two social security agencies, known as BPJS (Badan Penyelenggara Jaminan Sosial). Here’s how each one affects your employee’s pay in 2026.
PPh 21 income tax
Under PP 58/2023, you withhold PPh 21 monthly at an average effective rate (tarif efektif rata-rata, or TER), then settle the year in December. That’s why an employee’s December tax figure can look different from other months.
If you run a labour-intensive business, such as textiles or footwear, check whether the government-borne PPh 21 incentive (PPh 21 DTP) covers your staff. For the 2026 tax year it’s limited to certain sectors and to employees earning up to Rp10 million a month.
BPJS Kesehatan health insurance
BPJS Kesehatan covers your employees’ healthcare. Under Presidential Regulation (Perpres) 64/2020, contributions are 5% of monthly wages: you pay 4% and your employee pays 1%.
Contributions are calculated on wages up to a government-set ceiling that’s reviewed from time to time. Confirm the current ceiling with BPJS Kesehatan before you run payroll.
BPJS Ketenagakerjaan employment programmes
BPJS Ketenagakerjaan runs four employment protection programmes, and two of them take a share from your employee’s pay. The current BPJS Ketenagakerjaan rates set:
- old-age savings (jaminan hari tua, or JHT) at 5.7% of wages, with 3.7% from you and 2% from your employee
- pension (jaminan pensiun, or JP) at 3%, with 2% from you and 1% from your employee, on monthly wages up to Rp11,086,300 since March 2026, as set out in the BPJS Ketenagakerjaan 2026 wage cap circular
- work accident insurance (jaminan kecelakaan kerja, or JKK) at between 0.24% and 1.74%, depending on your industry’s risk level, paid only by you
- death benefit (jaminan kematian, or JKM) at 0.3%, paid only by you
Your employer shares, including all of JKK and JKM, sit on top of wages. You can still list them on the payslip as employer contributions, which shows staff the full value of their package.
Gross pay vs net pay
Gross pay is everything your employee earns in a pay period before deductions. Net pay is what’s left after deductions, and it’s the amount that reaches their bank account.
Here’s an illustrative example with round numbers. Say your employee earns a basic wage of Rp8,000,000 and a fixed transport allowance of Rp1,000,000, so their gross pay is Rp9,000,000. Their deductions for the month might be:
- Rp90,000 for their BPJS Kesehatan share
- Rp180,000 for their JHT share
- Rp90,000 for their JP share
- Rp150,000 for PPh 21, an example figure since the real amount depends on their TER category
That’s Rp510,000 in total deductions, so net pay is Rp8,490,000. Your own BPJS contributions are paid on top, so the employee’s net pay stays the same.
How to create a payslip
Creating a slip follows the same steps every pay run, whether you use a spreadsheet or an app. If you’d rather hand the whole job to a specialist, you can outsource payroll instead.
1. Collect employee details
Start with each employee’s full name, NIK (Nomor Induk Kependudukan, the national identity number), job title and bank account. Add their marital status and number of dependants, since these set their TER category. If you’re hiring your first employee, gather these details on day one.
2. Record earnings for the pay period
List the basic wage, allowances, overtime and any THR due that month. Keep work expense reimbursements on a separate line so they’re easy to tell apart from wages.
3. Calculate deductions
Work out PPh 21 and the employee’s BPJS shares using the rates above. Connected payroll software can handle these sums for you each month.
4. Work out net pay
Subtract total deductions from gross pay to get net pay. Check the result matches the amount you’ll transfer to your employee’s bank account.
5. Issue the slip on payday
Send the slip when you pay wages, either printed or electronically. A ready-made payslip template gives every slip the same layout, so staff always know where to look.
6. Save a copy
File a copy of every slip with your payroll records. Organising files by month makes it quicker to answer questions later.
Paper and electronic payslips
You can hand over a printed slip or send it electronically, by email or through an online portal. The Electronic Information and Transactions Law (UU ITE), as amended by UU 1/2024, generally recognises electronic documents and printouts as valid legal evidence.
That recognition relies on the electronic system keeping documents intact and accessible, so use a secure system to store and send slips. With online payroll, you can email slips on payday or share them in a portal your staff can open on their phones.
How long to keep payslip records
Keep slips with your other payroll records, because Indonesian tax law sets a long retention period for bookkeeping documents. Under Article 28(11) of the General Provisions and Tax Procedures Law (UU KUP), you must keep bookkeeping records in Indonesia for 10 years.
This is a general bookkeeping rule that covers the documents behind your books, including payroll records, and it applies to electronic records too. Storing slips digitally in dated folders keeps a 10-year archive easy to search.
Create payslips faster with Xero
Clear, accurate slips keep your team informed and your business compliant, and a steady routine makes them quick to produce each payday. With Xero, you can connect a payroll app from the Xero App Store so pay run data flows into your accounts and financial reports. Try it with your team and get one month free.
FAQs on payslips
Here are quick answers to questions Indonesian employers often have about payslips.
How do employees receive their payslip?
You can email slips or share them through a payroll app, and printed copies are fine if your team prefers paper. Whichever method you choose, use it every payday so staff know where to find their slips.
Is a payslip the same as the BPA1 form?
They’re different: a payslip covers one pay period, while BPA1, the PPh 21 A1 withholding slip (bukti potong), is issued yearly to permanent employees through Coretax. Coretax is the tax office’s online administration system, and employees can download their BPA1 there.
Can a payslip be used as proof of income?
Yes. Banks and landlords may ask your employees for recent slips, so issuing accurate ones every month makes those applications simpler for your staff.
Should THR appear on a payslip?
Yes, show THR as its own earnings line in the month you pay it. Minister of Manpower Regulation (Permenaker) 6/2016 requires you to pay THR in full at least seven days before the employee’s religious holiday.
What should an employee do if their payslip looks wrong?
Ask them to raise it with you straight away, then check the slip against their timesheet and the current deduction rates. If you find an error, correct it in the next pay run and issue an updated slip that shows the adjustment.
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Disclaimer
This glossary is for small business owners. The definitions are written with their requirements in mind. More detailed definitions can be found in accounting textbooks or from an accounting professional. Xero does not provide accounting, tax, business or legal advice.