Almost every business owner has calculated the break-even point once, obtained a figure that seems reasonable, and then used it as a target throughout the year. The problem rarely lies in the arithmetic. The formula is short and difficult to get wrong. What usually skews the results is one cost that sits in the wrong column.
The formula is as follows: break-even point in units equals fixed costs per month divided by contribution margin per unit, and contribution margin is the selling price minus variable costs per unit. Since variable costs are in the denominator, a small mistake there has a much larger impact than the same mistake in the numerator.
There is only one filtering question
If this month you do not sell anything, does that cost still incur or not? If it still incurs, it is a fixed cost. If it only appears because one more unit is sold, it is a variable cost. This question is more reliable than the account name, as account names are often inherited from templates created by others for different businesses.
Four costs that are often misclassified
Final Income Tax for MSMEs at 0.5 percent. This rate is calculated from gross turnover, not from profit, so its value increases every time there is an additional sale. It belongs in the variable cost category. Government Regulation 20/2026 removes Article 59 of Government Regulation 55/2022, which previously limited its use to seven years for individual taxpayers and four years for individual companies, so for both groups, the rate is now no longer time-limited. What remains unchanged is the basis for its imposition: turnover, not profit.
VAT. For entrepreneurs who have been designated as VAT taxpayers, VAT is not a cost at all. It is collected from buyers and then deposited, and input tax on purchases can be credited. Placing it in variable costs makes the contribution margin appear thinner than reality, and the break-even point expands. This obligation only arises after gross turnover exceeds Rp4.8 billion in a year, a threshold that has been in effect since PMK 197/PMK.03/2013. Its effective rate for non-luxury goods and services remains at 11 percent, which is the 12 percent rate multiplied by the tax base of another value of 11/12, according to PMK 131/2024.
Holiday allowance. The holiday allowance (THR) is a fixed cost that occurs once a year, and precisely because of that, it often never appears on the monthly fixed cost list. The Minister of Manpower Regulation Number 6 of 2016 requires THR to be paid no later than seven days before religious holidays, amounting to one month's wages for workers with twelve months or more of service, and proportionally for those with one to less than twelve months of service. If its value is not reserved each month, the first eleven months appear to have passed the break-even point, and the twelfth month erases it.
Marketplace commissions and payment fees. Both increase with the number of sales, so both are variable. Since they are usually deducted before the money enters the account, both are the easiest to overlook in records.
The difference is not a small one
Take a selling price of Rp50,000 with material costs of Rp30,000 per unit, and fixed costs of Rp10 million per month. The contribution margin appears to be Rp20,000, so the break-even point is 500 units. If the marketplace commission is 10 percent, or Rp5,000 per unit, forgetting to include it means the actual margin is Rp15,000 and the break-even point is 667 units. The difference is 167 units, about 33 percent above the assumed target, and all comes from one misclassified line.
A mistake in the opposite direction is equally troublesome. Raw materials placed in the fixed cost column inflate the numerator and the denominator, making the break-even point appear much lighter than reality. Therefore, checking the placement of each cost line is more crucial than fine-tuning the numbers.
Once every cost is in the correct column, the rest is just division, and that part can be handed over to the break-even calculator which also converts monthly targets into daily targets.
Sources
- Directorate General of Taxes, PMK 131/2024: VAT Rate Eleven-Twelve → pajak.go.id
- Ortax, Official! Individual Taxpayers and Individual Companies Can Now Use the 0.5 Percent Rate Without Time Limit (PP 20/2026) → ortax.org
- BPK Regulation, Minister of Manpower Regulation Number 6 of 2016 on Holiday Allowance for Workers in Companies → peraturan.bpk.go.id
- Directorate General of Taxes, Threshold for Small Entrepreneurs Required to Pay VAT Increased (PMK 197/PMK.03/2013) → pajak.go.id