TraceWorthy

Lease negotiations in Bali often happen close to family life.

This photo shows Junior Legal Manager Andik Putra negotiating the extension of one of TraceWorthy’s office leases with the lessor’s family. It is a simple image, yet it says a great deal about how trust works inside a business. TraceWorthy’s owner placed the conversation in Andik’s hands because he has shown the care, preparation, and people sense needed for this kind of negotiation.

That is also what clients receive from TraceWorthy’s legal team. A lease conversation is about more than a written term. It affects where people work, how the business plans ahead, and how the relationship with the lessor continues after the document is signed.

Good legal support enters early. It asks the practical questions before expectations harden. It protects the client’s position while respecting the person across the table.

If your business is negotiating a lease or reviewing property arrangements in Indonesia, speak with TraceWorthy before you agree the terms.

Our Team Is Your Team.

A common assumption among foreign owners in Bali is that a PT PMA carries a higher corporate tax rate than a local company. The rate is in fact 22 per cent for both, because tax follows where a company is resident, and a PT PMA is resident in Indonesia.

What changes the figure is turnover. A resident company with annual turnover under IDR 50 billion qualifies for Article 31E relief, which halves the rate to 11 per cent on the income from its first IDR 4.8 billion of turnover. On turnover of IDR 30 billion with IDR 3 billion of taxable income, that saves around IDR 53 million against the flat rate.

Ownership shows up when profits leave Indonesia. A dividend to a foreign shareholder is taxed at 20 per cent at source, which a tax treaty can bring down to 10 or 15 per cent if the shareholder files a certificate of domicile before the payment. Getting that paperwork ready in advance is what protects the lower rate.

The article sets out the 22 per cent rate, a worked Article 31E example, the 19 per cent listed-company rate, and the withholding on dividends and royalties paid abroad.

https://www.traceworthy.com/corporate-income-tax-indonesia/

Why a PT PMA Pays the Same Corporate Income Tax as a Local Company Corporate income tax in Indonesia is 22 per cent for any resident company, foreign or local, with reliefs for low turnover and tax on dividends sent abroad.