Our Global Network

Doing business in Indonesia

How quickly can I set up a business?

2-5 weeks

What is the minimum investment needed?

Minimum commitment of total investment should be at least IDR 10billion (≈ USD 700,000).

How can I raise finance?

Shareholders must inject at least IDR 2.5billoin (≈ USD 175,000).

What are the legal requirements for setting up my business?

The new ‘Omnibus Law’ has opened up most business classifications to 100% foreign ownership.

There are 45 business classes that maintain partial ownership, depending on the business line in question, while a total of 58 business classes remain closed to foreigners.

What structure should I consider?
Establishment of Representative Office:

• No capital requirement.
• To conduct market research or promotion of overseas company’s product.
• Not allowed to sign contract, issue invoice, receive payment, or applying business license.

Limited Liability Company:

• Minimum 2 Shareholders
• One residing Director and One Commissioner
• Company’s Law No 40 of 2007
• Must follow the minimum investment requirement

What advice can you give me in regards to payroll and taxation requirements?

• There are dedicated industrial parks scattered across Indonesia
• Indonesia currently has 19 Special Economic/Free Trade Zone which has easy accessibility to the global market and are given certain facilities and incentives.
• Indonesia offers various tax incentives based on industries and certain investment valued.
• Corporate income tax is 22% and will be reduce to 20% in 2022. Medium-sized companies with annual revenue of less than IDR 50 billion may apply for 50% reduction in income tax rate, and small companies with annual revenue of less than IDR 4.8billion eligible for corporate income tax of 0.5% from revenue.
• Value Added Tax is 10%.
• Personal income tax rates begin at 5% and gradually increase to 15%, 25%, and a top rate of 30%. Apart from taxes, companies must also contribute to Employees’ social and health program and pension plan.

Is there anything else that I should know?

Indonesia is the largest economy in Southeast Asia, with GDP over USD 1 trillion, and it continues to play dominant role in global affairs as it becomes ASEAN’s only member of G-20.

Indonesia is strategically located along major sea lanes connecting East Asia, South Asia and Oceania.

Indonesia is endowed with rich natural resources from being a major producer of liquified natural gas and expansion of mining industry. Petroleum and mineral make up the majority exports.

Indonesia is the World’s fourth most populous country, with 53% of 270million people live in urban areas with increased purchasing power and the productive age group will dominate the population in 2025-2035.

Our firms in Indonesia
How can Kreston grow your business?
Select your business type:

Latest news

Kreston SNR ESG Climate Change

Kreston SNR, India, knowledge partner for International Climate Summit

Kreston SNR will be taking part in the International Climate Summit 2022 – Opportunities for Green Hydrogen in India, scheduled to be held in Bergen, Norway on 30 and 31 August 2022.

Brighture Newsletter

Kreston firm, Brighture, shares its expertise in its latest newsletter covering financial news and updates from China.

blockchain news

Investors face Cryptocurrency challenges

Investors face Cryptocurrency challenges since the arrival of Crypto assets, with the lack of regulations and laws in place to reduce scams.