How to Pay Taxes on NFT Profit in Indonesia: Complete 2024 Guide

Understanding NFT Tax Obligations in Indonesia

As Indonesia’s digital asset market expands, non-fungible tokens (NFTs) have become lucrative investment vehicles. The Directorate General of Taxes (DJP) categorizes NFT profits as taxable income under Law No. 36/2008. Whether you’re an artist, collector, or trader, understanding how to pay taxes on NFT profit in Indonesia is crucial to avoid penalties. This guide breaks down everything you need to know about NFT taxation under Indonesian law.

Are NFT Profits Taxable in Indonesia?

Yes. The DJP treats profits from NFT sales as capital gains subject to Income Tax (Pajak Penghasilan/PPh). Tax liability applies when:

• You sell NFTs for more than your acquisition cost
• You receive NFT royalties from secondary sales
• NFTs are earned through mining or airdrops
• You exchange NFTs for other crypto or fiat currency

Indonesian residents must declare worldwide NFT income, while non-residents pay tax only on Indonesia-sourced NFT transactions.

How to Calculate Tax on NFT Profits

Follow this formula: Taxable Income = Selling Price – Acquisition Cost – Allowable Expenses

• Individual Tax Rates: Progressive rates from 5% to 30% based on annual income brackets
• Corporate Tax: Flat 22% for PT companies (2024 rate)
• Allowable Deductions: Include minting fees, gas fees, marketplace commissions, and blockchain transaction costs

Example: You buy an NFT for Rp50 million and sell for Rp200 million with Rp10 million in fees. Taxable profit = Rp140 million. If you fall in the 25% tax bracket, you owe Rp35 million in taxes.

Step-by-Step Guide to Reporting NFT Taxes

1. Track All Transactions: Maintain records of purchase dates, sale prices, wallet addresses, and fees
2. Convert to IDR: Calculate values in Indonesian Rupiah using Bank Indonesia exchange rates at transaction time
3. File SPT Tahunan: Report profits in your annual tax return (Form 1770 for individuals)
4. Use Correct Codes: Enter NFT income under Penghasilan Lainnya (Other Income) with code 419924
5. Pay by Deadline: Settle liabilities by March 31 following the tax year

Common NFT Tax Mistakes to Avoid

• ❌ Forgetting to report NFT-to-NFT trades (considered barter transactions)
• ❌ Ignoring small transactions – all profits are taxable regardless of amount
• ❌ Failing to document losses (can offset future NFT gains)
• ❌ Using personal wallets for business NFT activities (creates commingling issues)

Penalties for Non-Compliance

Failure to report NFT profits may result in:

• 2% monthly penalty on unpaid taxes
• Administrative fines up to 200% of tax owed
• Criminal charges for severe tax evasion (Law No. 28/2007)

FAQs: NFT Taxes in Indonesia

Do I pay tax if my NFT investment loses money?

No, but you should report the loss to offset future capital gains. Losses can be carried forward for 5 years.

How are NFT royalties taxed?

Royalties are treated as ordinary income taxed at your applicable rate. Report under Penghasilan Royalti (Royalty Income).

Are international NFT platforms required to withhold tax?

Currently no, but Indonesia is developing crypto tax reporting frameworks. You remain personally responsible for declaration.

Can I deduct NFT creation costs?

Yes, artists can deduct production expenses like software, hardware, and marketing when reporting NFT sale profits.

Is VAT applied to NFT transactions?

Not currently. NFTs are exempt from Value Added Tax (PPN) under Finance Minister Regulation No. 69/PMK.03/2022.

Staying Compliant with Indonesian NFT Tax Laws

With Indonesia’s tax authority increasing crypto asset monitoring, proper NFT tax compliance is essential. Consult a certified tax advisor (Konsultan Pajak) for complex cases, and always maintain transaction records for at least 10 years. By understanding how to pay taxes on NFT profit in Indonesia, you protect your investments while contributing to the nation’s digital economy growth.