For many foreigners, Bali and Indonesia conjure up images of endless beaches and exquisite vacations. However, there exist other enticing aspects to this perpetually sunny country that have piqued the interest of many entrepreneurs. We mean the prospect of registering a company in Bali with the potential to obtain a residence permit under KITAS and KITAP visas later on.
A wise and secure choice to start a company, Indonesia may appear the best option for you. With its business-friendly legislation, the country welcomes non-resident business people willing to set up companies here and relocate to the shores of the Pacific and Indian Oceans, if they wish.
Working in tandem with their partners, the Q Wealth expert team will facilitate the seamless registration of your company in Indonesia, complete with a bank account. NB: Everything is done remotely with no need for the business founder’s physical presence.
Discuss the details with an expert
Check the list of required documents, and get the details of the process, terms, and costs.
Contact a consultantLet’s talk via messenger
Why is registering a company in Indonesia beneficial for you?
Here are the reasons why foreign investors are increasingly opting for Indonesia as their business relocation destination:
- Indonesia ranks as the third-largest Asian country in terms of its domestic market size, trailing only behind China and India.
- A readily available and cost-effective workforce.
- A well-established infrastructure and a thriving economy.
- The presence of special economic zones in the country, offering investors a range of incentives for their businesses, including VAT exemptions and reduced corporate income taxes.
- A favorable business climate and a portfolio of over 65 double taxation avoidance agreements.
- Appealing tax incentives for trade with member countries of the Association of Southeast Asian Nations (ASEAN), which can result in minimal or even zero tax liabilities.
- Since 2015, foreign investors have been allowed to own land in Indonesia for construction or other purposes.
FYI: Company founders in Indonesia can obtain a KITAS visa and extend this privilege to their foreign employees, a service expertly provided by Q Wealth.
Company in Indonesia: structure, rights, and responsibilities
PT PMA which stands for Perseroan Terbatas Penanaman Modal Asing or a limited liability company with foreign ownership is the only business entity in Indonesia that permits 100% foreign ownership. This formation type is suitable for a wide range of business activities.
Company structure
Below, you will find the requirements for the founders and the management team of a PT PMA company in Indonesia:
- Company shareholders: a minimum of 2 natural or legal persons.
- Authorized representatives of the company: a director and a commissary who may be either unbiased individuals or company shareholders. It is advisable to appoint an Indonesian resident with a tax identification number (NPWP) as the director at the time of company registration.
- Registered address and office space for the company in Indonesia: provided by Q Wealth partners as part of the comprehensive service package.
FYI: At Q Wealth, we offer the services of a local company director who operates under a contract, actively participates in business account setup, manages the company’s incorporation documents, and receives a salary. To minimize risks, after the establishment of the company in Indonesia, you have the option to appoint a shareholder to the director’s position. A local director is only required during the PT PMA registration phase.
An integral part of establishing a business in Indonesia revolves around meeting the significant requirements for its authorized capital. This requirement exhibits a degree of flexibility. There exist various legitimate strategies to avoid making the authorized capital, with the opportunity to strategically benefit from the above requirement.
A PT PMA company is by default required to have a minimum authorized (or investment) capital of IDR 10 billion (approximately USD 681,000). In practice, this amount can be contributed step by step, aligning with the progression of business activities. Consequently, the capital status in the official documents will be indicated as contributed, with regulatory scrutiny primarily focusing on the company’s financial transaction reporting.
What advantages do foreign investors get from this? To gain a comprehensive understanding, you are welcome to seek recommendations and guidance from Q Wealth experts during company registration in Indonesia. In essence, the authorized capital enjoys tax exemptions in Indonesia. It can be infused gradually in adaptable installments. The said authorized capital is a resource for business expansion and development.
PT PMA: taxation and financial reporting
At the legislative level, Indonesia’s tax system sets the following tax rates for PT PMA companies:
- Corporate income tax: 22%.
- Value Added Tax (VAT) applicable to companies with an annual turnover exceeding IDR 4,800,000,000: 11%.
However, several tax incentives are available that enable foreign investors to optimize tax liabilities for their businesses in Indonesia. Here’s what these incentives include:
- During the first 3 years, the corporate income tax rate is reduced to 0.5% for newly established companies with an annual turnover of up to IDR 4.8 billion (approximately USD 326,000).
- Authorized capital is exempt from taxation and can be used for business expansion or other corporate purposes.
- Taxes do not apply to loan payments.
FYI: If a PT PMA’s annual revenue is above the allowed threshold, the standard rate of 22% will be applied to such income, regardless of the company’s age.
In Indonesia, companies are obliged to submit reports on a quarterly and annual basis. In some cases, they will do it monthly. The specific reporting requirements for PT PMA companies in Indonesia are contingent on various factors, such as the number of employees, annual revenue, the company’s industry, and more.
These are the primary recurring reports you will have to submit:
- tax returns which may occasionally be nil
- investment reports
- capital investment reports (LKPM)
- reports to social security agencies (BPJS).
Additional services from Q Wealth come with a variety of choices, like preparing financial reports at a set price. In the first few months after the company’s incorporation in Indonesia, we offer free assistance and advice to our valued customers. We help them with any questions or worries they may have.
How to license your business in Bali
Indonesian laws not only allow but also actively encourage foreign investors to establish businesses within the country. To start operations in compliance with the law, be sure to obtain a specific license that corresponds to your type of business (known as KBLI). Most importantly, you’ll need to receive a company registration number for your business (NIB). With this unique identifier, you will have no issues with company operation and no need for certain permits and official documents:
- General Importer’s License, previously known as API-U.
- Customs Identification Number (NIK), which applies to both importers and exporters.
- Company Incorporation Certificate, formerly known as TDP.
- Once you’ve acquired the NIB, your PT PMA will be automatically registered in the Indonesian healthcare and social security system (BPJS Kesehatan and BPJS Ketenagakerjaan).
Depending on your business’s industry, additional licenses may be necessary for it to operate legally in Indonesia.
Establishing a bank account for PT PMA in Indonesia
Supported by Q Wealth pros, you will seamlessly set up a bank account in Indonesia, as it is an integral part of our comprehensive service package. Here are the essential details that every foreign business owner in Bali should understand about banking services there:
- Corporate account: To open an account, the company’s director shall be appointed. This position can be filled by an Indonesian resident. While the terms may vary among different banks, Q Wealth partners offer services through a reputable and reliable financial institution in Indonesia. Here’s what foreign companies can benefit from therein:
- corporate card in addition to the company’s primary account
- multi-currency account supporting more than 12 currencies
- access to international money transfers
- favorable limits for currency exchange operations, including sending, storing, and receiving funds.
- Cryptocurrency account: To set up a cryptocurrency account for a company in Indonesia, the company’s director shall also be present. For the latter to undergo the corresponding AML/KYC (Anti-Money Laundering/Know Your Customer) checks is a must. This is what you will be able to do with such an account, tailored for companies targeting the global market:
- buy and sell cryptocurrencies using the company’s bank account
- receive cryptocurrency payments via a crypto exchange and subsequently transfer them to the corporate bank account using the SWIFT system
- make reverse transactions, including fiat currency deposits, transfers to the cryptocurrency account, and payments to counterparties.
You should take into account the currency control regulations in Indonesia. Here, internal sale and purchase transactions may only be made in the local currency, IDR. This also applies to the conversion or transfer of funds into cryptocurrencies, with exchanges charging transaction fees, and withdrawals subject to a 0.33% tax rate.
FYI: Although cryptocurrency is not legalized as a means of payment in Indonesia, it is still considered a lawful commodity. There are withdrawal limits for cryptocurrencies from exchanges, currently set at a maximum of USD 50,000 per day. It’s advisable to gradually increase this limit if necessary.
Should you require an additional corporate account for your company in another country, you can open one freely. Just select a bank that aligns with your goals using recommendations and advice from Q Wealth experts.
FREE EXPERT CONSULTATION
with seasoned professionals on international
banking
and where it is best to open
non-resident corporate accounts.
with seasoned professionals on international banking and where it is best to open non-resident corporate accounts.
Expenses associated with starting your business in Bali: service fees and labor costs
When you reach out to the Q Wealth expert team, you’ll benefit from their assistance with registering your company in Indonesia. The company’s constitutional documents will be hand-delivered to you by a courier, ensuring a personalized service experience.
Our basic service package for company incorporation in Indonesia starts at USD 16,000 USD. These are the services it includes:
- registration of your company in Indonesia
- initiation of a primary multi-currency account
- office leasing and provision of a registered company address
- nominee services
- free consultation.
Below, you will find the services that can be ordered either individually or in addition to the above basic service package:
- Crypto account: USD 2000.
- Amendments to the company’s Articles of Association (such as changes in ownership or shareholders): USD 3000.
- A second bank account, either in Indonesia or abroad: the associated fees start at USD 2700.
- A set of 3 corporate bank cards: USD 1200.
- Licensing for specific business activities: the fees start at USD 2000.
- Adding an extra business activity category: USD 600.
- KITAS investor visa: USD 2500.
- Document services, including translation, notarization, and apostillation: USD 2200.
The below expenses related to business operations can be included in the salary fund:
- Office rent (starting from the 2nd year): USD 1500.
- Annual salary paid to the nominee director: USD 4800.
Accounting services (starting at USD 3000) are provided on an individual basis. They are required even for those companies that do not conduct operations in Indonesia but have registered a PT PMA there. Here are the details of these services:
- Investment report submission (if monthly service is not used): USD 100 per quarter.
- Annual filing of a zero activity report for dormant companies: USD 550.
- Annual report for companies with minimum turnovers (up to USD 100,000 per month): USD 1000 (annually).
- Monthly report for companies with turnovers up to USD 500,000 per month: USD 2400 (annually).
- Monthly report for companies with substantial turnovers exceeding USD 500,000 per month: USD 3000 per year.
NB: Fees for accounting services in Bali may vary depending on the nature of your business and the company’s commercial activities.
Online registration of PT PMA in Indonesia
You have an exclusive opportunity to establish a company in Indonesia with no need for a foreign beneficiary to be physically present there. Don’t hesitate to apply to Q Wealth for remote registration of PT PMA. With our expert guidance, you will achieve it in no time as Q Wealth maintains close collaborations with Indonesian partners, government agencies, and financial institutions.
Establishing a PT PMA company in Indonesia involves several key stages:
- Discuss all details and additional service options with Q Wealth experts. You can easily reach us using the provided contact information. Alternatively, feel free to fill out the contact form on our website.
- Define the scope of services required and the associated costs. Clients are typically required to prepay 50% of the total fee amount using payment methods that are convenient for them such as cryptocurrency, bank transfers, payment system transactions, or electronic wallets.
- Prepare and legalize the documents necessary to register a company with a bank account in Indonesia. Be sure to include the following details:
- company name
- types of activities (up to 5 options, preferably low-risk industry sectors)
- application for bank account and cryptocurrency exchange account setup
- copies of all founders’ passports plus passport photos (3×4)
- founding documents
- structure of company directors and shareholders.
- Allow for a waiting period of approximately 15 to 20 days.
- Settle the remaining 50% of the service fees with Q Wealth specialists and receive all corporate documents either through courier delivery or in person. Mind that in the latter case, the founder shall visit Indonesia in person. This step also grants you access to online banking and a token.
- Launch your business in Bali.
Ready to launch a business in one of the world’s most enchanting and vibrant locations? To kickstart your journey and set up a company in Bali, start with a free consultation and recommendations from Q Wealth seasoned experts!
