Tax residency in Indonesia is subject to several conditions and requirements, which foreigners need to fulfil in order to become tax residents in the country. These conditions are as follow:
The intention to reside refers to several variables such as: Having immigration documents like a residency permit, having a work contract in Indonesia, renting a place to live or moving family members to Indonesia.
Depending on their status, foreigners will be taxed differently.
As for Indonesian citizens, unlike foreigners, they are considered Tax Residents since birth. And this status can only change in case they leave Indonesia permanently. Nonetheless, if an Indonesian national leaves the country temporarily, he might also be considered as non-resident, if he/she fulfils certain requirements, such as: Being present in Indonesia for less than 183 days in a fiscal year.
In such case, taxes will only apply on income obtained from Indonesian sources, while the rest of his income will only be taxed in his country of residency or source of income.
Please don't hesitate to consult our Tax Advisory Services for further information regarding Indonesian Tax.
If you would like to know more, contact our expert consultants and request your consultation through our email or WhatsApp.
Tunjangan Hari Raya (THR) is a mandatory religious holiday allowance in Indonesia. It is a key part of employee rights, ensuring workers receive extra financial support before major religious celebrations. Employers must understand their obligations to avoid legal consequences. What is THR in Indonesia? THR is a one-time annual payment given to employees before religious […]
When hiring in Indonesia, companies must navigate specific employment laws to ensure compliance, particularly when it comes to employment contracts. Employers in Indonesia typically choose between Definite-Time Employment Contracts (PKWT) and Indefinite-Time Employment Contracts (PKWTT). Both contract types come with their own set of rules, advantages, and obligations. This guide offers an overview to help […]
Estate planning in Indonesia requires careful attention, especially for foreigners holding assets here. Indonesian law has its own framework for wills, and it does not automatically align with international estate planning rules. Indonesian wills and international wills A notary in Indonesia can only prepare a testament covering assets located within Indonesia. For example, if a […]
