Table of Contents
We’re here to help you on your journey to hire, manage and pay.
When Non-Compliance May Occur
Failing to comply with Indonesia’s payroll regulations can result in significant penalties, legal disputes, and damage to the company’s reputation. Below are common areas where non-compliance may occur and how to avoid them.
Delayed Salary Payments
Employers must ensure that salaries are paid on time according to the terms outlined in the employment contract. Delayed salary payments can lead to employee disputes and fines imposed by the authorities. To avoid this, businesses should implement automated payroll systems that ensure timely payments.
Missed BPJS Contributions
Employers who fail to meet BPJS contribution deadlines may face financial penalties and a loss of insurance benefits for employees. It is essential to establish a payroll system that calculates BPJS contributions accurately and ensures that payments are submitted on time.
Incorrect Tax Withholding
Failing to withhold the correct amount of tax or delaying tax submissions can lead to penalties from Indonesian tax authorities. Employers must ensure that tax calculations are accurate and that taxes are reported and submitted by the required deadlines.
Non-Compliance with Leave Policies
Employers who fail to provide employees with their statutory leave entitlements may face legal challenges and claims for compensation. Businesses should familiarize themselves with the leave entitlements mandated by Indonesian labor laws and ensure that employees are granted the appropriate amount of paid leave.
How AYP Can Help
Managing payroll in Indonesia can be challenging, especially when it comes to staying compliant with labor laws, social security contributions, and tax regulations. AYP offers a comprehensive range of services to help businesses manage payroll efficiently while ensuring full compliance with Indonesian regulations.
Professional Employer Organisation (PEO) Services
AYP’s PEO services allow businesses to outsource payroll management, including salary payments, tax withholding, and BPJS contributions. We take care of all employer responsibilities, ensuring that your company stays compliant with local labor laws and regulations.
Employer of Record (EOR) Services
As an Employer of Record, AYP serves as the legal employer for your workforce in Indonesia. We handle all payroll and administrative tasks, allowing businesses to focus on their core operations without worrying about compliance issues.
Payroll Outsourcing Management (POM) Services
AYP’s Payroll Outsourcing Management (POM) services provide end-to-end payroll solutions, including salary calculations, BPJS contributions, tax reporting, and employee benefits management. By outsourcing your payroll to AYP, you can ensure that your payroll processes are accurate, compliant, and efficient.
