January 13-2025
By: Marisa
Have you ever received your payslip, glanced at the numbers, and focused only on the “Net Pay/Take-Home Pay” without really understanding the details above it? If so, you’re not alone! For many people, a payslip feels like a mysterious document filled with codes and complicated deductions.
In fact, your payslip is the key to understanding the total value of your work. Let’s break down its essential components so you can become more financially savvy!
1. Main Components: The Source of Your Income
These are the parts we usually recognize, but it’s important to understand the differences between them:
Component | Brief Explanation |
Base Salary | The basic compensation agreed upon for your work, according to your position and normal working hours. |
Fixed Allowances | Regular compensation paid together with the base salary and not affected by attendance (e.g., Position Allowance). |
Variable Allowances | Compensation that can vary depending on attendance, performance, or work location (e.g., Meal Allowance, Transportation Allowance). |
Overtime | Compensation for working hours beyond the established normal working hours. |
In short: Base Salary + Allowances + Overtime = Gross Income.
All deductions are calculated based on this amount.
2. The Hidden Components: Mandatory Deductions Often Overlooked
This is the part that often causes confusion. Why is the take-home pay always lower than expected? The answer lies in these mandatory deductions:
A. Income Tax (Article 21 / PPh 21)
This is the most common and often the largest deduction. PPh 21 is a tax imposed on income related to employment.
- Why is it deducted?
Because every citizen earning above a certain threshold (called PTKP / Non-Taxable Income) is required to pay income tax to the state. - Who deducts it?
Your company (as the employer) acts as the tax withholder and remits the tax to the government. - What affects the amount?
Marital status (married/single), number of dependents, and your gross income.
B. Social Security (BPJS Ketenagakerjaan – Employment Social Security)
This is a mandatory social protection program for all workers to secure their future. The deductions consist of several programs:
Program | Approximate Deduction | Brief Benefit |
JHT (Old-Age Security) | 2% of Salary | Long-term savings that can be withdrawn upon retirement or termination of employment. |
JP (Pension Security) | 1% of Salary | Provides monthly income after reaching retirement age. |
JKK & JKM | (Paid by Employer) | Work Accident Insurance and Death Benefit. You rarely see these deducted because they are usually fully covered by the company. |
C. Health Insurance (BPJS Kesehatan)
This is a contribution to the mandatory government-managed health insurance:
- Approximate Deduction: ~1% of Salary
- Function: Ensures that you and your family (if covered) have access to affordable healthcare services.
Remember: BPJS deductions are an investment in your future. The money doesn’t disappear—it is set aside for emergencies (accidents/illness) or retirement.
3. Additional Components: Other Deductions and Benefits
Beyond the mandatory items above, you may also find:
- Employee Loans: Installment deductions for loans provided by the company.
- Labor Union Dues: If you are registered as a union member.
- Religious Holiday Allowance (THR) / Annual Bonus: Additional income usually paid separately or combined, but still recorded and subject to PPh 21.
Learn more and consult with the expert team at Qando Qoaching at: https://campsite.bio/qqgrou, and stay updated through our official social media channels.
Let’s move forward together toward a greater Indonesia!
