Business Set Up in Indonesia
By setting up a business in Indonesia you will open a PT PMA (Foreign Investment Company) or a local Local PT (PMDN)
Set Up a PT PMA
To conduct business in Indonesia/Bali as a foreigner, it is necessary to establish a PT PMA (foreign investment company). This type of company allows you to have complete ownership and control over your business operations.
As a foreign investor, you have the opportunity to own up to 100% of the shares, in accordance with Indonesian law.
Benefits of setting up a PT PMA in indonesia
Here are the benefits of setting up a PT PMA in Indonesia:
- Ability to Employ Foreigners
- Own the Rights to Register Products
- Own the Rights to Obtain License
- Own the Rights to hold a Property Ownership
PT PMA (foreign-owned company) is a highly preferred option for foreign entrepreneurs and investors due to its ability to meet the legal requirements in Indonesia. At Cakra Visa Solutions, our dedicated team provides comprehensive services, including expert advice on your eligibility to start your business.
In a PT PMA, both individuals and legal entities are allowed to be registered as shareholders, offering flexibility to foreign investors.
It’s important to note that a local PT (PMDN) and PT PMA are quite similar, with the only distinction being that in a local PT, all founders are Indonesian, whereas in a PT PMA, one or even all founders can be foreigners.
Rest assured, we are here to guide you through the intricacies of these structures and ensure compliance with the necessary regulations.
How many people and how much capital is needed?
When setting up a PT PMA, it is required to have a minimum of 2 shareholders:
- One person will serve as the Director.
- One person will serve as the Commissioner.
It is also possible to register with more than 2 shareholders in a PT PMA.
To establish a PT PMA, the authorized capital of the company should be at least Rp 10.000.000.000 (Ten Billion Rupiahs).
After the PT PMA is established, you are required to pay or inject capital based on the investment amount relevant to your business activities. There is no time limit for this capital injection.
As a director, if you have a minimum investment of Rp 1.000.000.000 (One billion rupiahs) or 10% of the shares, you can manage your company using the C314 INVESTMENT KITAS.
This means you can operate without the need for a working permit, which typically costs 1200 USD. The C314 INVESTMENT KITAS grants you a two-year permit to stay in Indonesia with multiple entry privileges.
These regulations are outlined in the Regulation of the Minister of Manpower (Permenaker) No. 10/2018, specifically in Article 10, Article 22, and Article 26-point C.
If you are listed as a commissioner, you are not permitted to work directly. However, you can still apply for the C314 INVESTMENT KITAS and obtain a two-year multiple entry permit with a minimum of 10% shares.
How many days to create the PT PMA?
For the manufacturer of the PT PMA, until it is set up completely, it takes 7 business days with our legal team.
what info do you need for the business set up?
These are the information that we need from you to set up your PT PMA:
Company Name: Choose a name for your company. The name can be in any language and must consist of a minimum of 3 words and 3 alphabets. Please note that certain terms such as ‘company,’ ‘co,’ ‘community,’ ‘LTD,’ ‘Ent,’ and ‘Enterprise’ are not allowed as PT PMA names.
KBLI / Business Fields: Under a PT PMA, you can register up to 5 different types of business sectors. Each business field has a specific code in the government system known as OSS. We have attached the link to the OSS system for your convenience.
https://oss.go.id/en/informasi/kbli-berbasis-risikoPosition in the Company: Specify the position for each person involved. In a PT PMA, it is required to have at least one person serving as the Director and another person as the Commissioner.
Price for the Business set up (PT PMA)?
Our price for setting up a PT PMA is Rp 15.000.000 (Fifteen Million Rupiahs).
Price Inclusion
Please note that in our price is included:
- Approval of Company Name
- Deed of Establishment from Notary
- Approval of Legal Entity from The Ministry of Humanity Law and Rights of Indonesia ( SK KUMHAM )
- Registration of Tax ID (NPWP) for company
- Virtual office address for 1 year (with 6 times meeting room free up to 6 persons in 1 year)
- NIB and Business License registration from OSS
- Assistance with opening a company bank account (with our bank partner)
Please note, all company paperwork or documents will be only in Bahasa. If you need to be translated into other languages you can use a sworn translator once the PMA is set up at your own expense.
Obligation after setting up the pt pma
Once your PT PMA is set up, you are obligated to report a LKPM and Tax every year maximum. You can use your own consultant for this, and we are happy to help if you need any documents from us. If you wish to report your LKPM and Tax with us, you can message us for further information.
The Laporan Kegiatan Penanaman Modal (Investment Activity Report) report usually contains the profit and loss statement of your company, information on the number of employees, etc. This report is important as the government will see that your company is up and running instead of being a dormant company.
Failing to provide such a report will attract the authorities to run an audit of your company.
The general income tax rate is 11-25% of the net profit if the company’s gross revenue is above Rp 4.800.000.000 (Four billion eight hundred million rupiahs). A flat rate 25% is applied when the yearly revenue of the company is above Rp 50.000.000.000 (Fifty billion rupiahs).
If the company’s gross income is below Rp 4.800.000.000 (Four billion eight hundred million rupiahs)., the final income tax rate is 0.5% of the monthly gross income.
Set up a LOCAL PT (PMDN)
Setting up a PT Local company is a relatively straightforward process compared to establishing a PT PMA.
However, it’s important to note that as a foreigner, you cannot be a shareholder or have ownership of the company. Instead, full ownership must be held by a local person or an Indonesian citizen.
To obtain a Local PT (PMDN), a minimum investment capital of Rp 50.000.000 (Fifty million rupiahs) is required. You must also pay at least 25% of the total investment plan.
Please keep in mind that if you intend to employ a foreigner under your local PT, the capital requirement increases to a minimum of Rp 1.000.000.000 (One billion rupiahs), and you will be required to pay 25% of the total capital.
How many days to create the Local PT?
what info do you need for the Local PT set up?
When filling out our Local PT setup form, please provide the following information:
Company Name: Choose a name for your company. The name can be in any language and must consist of a minimum of 3 words and 3 alphabets. Please note that certain terms such as ‘company,’ ‘co,’ ‘community,’ ‘LTD,’ ‘Ent,’ and ‘Enterprise’ are not allowed as PT names.
KBLI / Business Fields: Under a PT, you can register up to 5 different types of business sectors. Each business field has a specific code in the government system known as OSS. We have attached the link to the OSS system for your convenience.
https://oss.go.id/en/informasi/kbli-berbasis-risikoPosition in the Company: Specify the position for each person involved. In a PT, it is required to have at least one person serving as the Director and another person as the Commissioner.
By providing this information accurately, we can ensure a smooth and efficient process for setting up your Local PT. Should you have any questions or need further assistance, please don’t hesitate to contact us. Our team is here to help you every step of the way.
Price for the Business setup (local pt)?
Our price for setting up a Local PT is Rp 10.000.000 (Ten million rupiahs)
Price Inclusion
Please note that in our price is included:
1. Approval of Company Name
2. Deed of Establishment from Notary
3. Approval of Legal Entity from The Ministry of Humanity Law and Rights of Indonesia ( SK KUMHAM )
4. Registration of Tax ID (NPWP) for company
5. Virtual office address for 1 year (with 6 times meeting room free up to 6 persons in 1 year)
6. NIB and Business License registration from OSS
7. Assistance with opening a company bank account (with our bank partner)
Please note, all company paperwork or documents will be only in Bahasa. If you need to be translated into other languages you can use a sworn translator once the PMA is set up at your own expense.
