JAKARTA. The 2026 FIFA World Cup not only made history as the first edition featuring 48 participating nations, but also became the richest tournament in the competition's history.
The International Federation of Association Football (FIFA) allocated a total prize pool of USD871 million (approximately IDR14 trillion, assuming an exchange rate of IDR16,200 per US dollar), to be distributed among all participating teams based on their tournament performance.
The scale of the prize money is reflected in the rewards for the finalists. Spain, crowned world champion, earned USD51 million, while runner-up Argentina received USD34 million.
England, which finished third, collected USD30 million, while fourth-placed France received USD28 million. The remaining prize money was distributed among the other 44 participating nations according to the stage they reached during the tournament.
The enormous prize pool is undoubtedly welcome news for football associations and the players who contributed on the pitch. In many countries, governments or football federations also grant additional bonuses to athletes in recognition of their achievements on the international stage.
However, behind these substantial prizes and bonuses lies another important question: Are prize money and bonuses received by athletes subject to tax?
The answer depends on the tax rules applicable in each country, including Indonesia. As the excitement surrounding the World Cup final continues, it is an opportune time to revisit the Indonesian tax treatment of prizes and bonuses awarded to athletes.
Income Tax on Athlete Prizes
The taxation of prizes and bonuses received by athletes is specifically regulated under the Director General of Taxes Regulation No. PER-11/PJ/2025 concerning the Imposition of Income Tax on Prizes and Awards. The regulation distinguishes the applicable tax treatment based on the recipient's tax status.
First, where the recipient is an Indonesian resident taxpayer, the prize or bonus is subject to Income Tax Article (ITA) 21, calculated using the progressive tax rates under Article 17 of the Income Tax Law on the gross amount received. The tax must be withheld by the competition organizer.
For example, if a football player receives a cash prize of IDR50 million, and the entire amount falls within the first tax bracket subject to a 5% rate under PER-11/PJ/2025, the ITA 21 withheld would amount to IDR2.5 million.
Second, if the recipient is a non-resident taxpayer other than a permanent establishment, the payment is subject to Income Tax Article (ITA) 26 at 20% of the gross amount, subject to any applicable relief under a Tax Treaty (Double Taxation Agreement/DTA). The withholding obligation rests with the party making the payment, including the event organizer.
Third, where the recipient is a corporate taxpayer, including a Permanent Establishment (PE), the payment is subject to withholding under Income Tax Article (ITA) 23 paragraph (1) point 4 at 15% of the gross amount. The tax must also be withheld by the party responsible for making the payment, including the competition organizer. (KEN)
