Your accounting
company in Indonesia

In Indonesia, it’s common for companies to outsource their accounting services. The reason is that employing a skilled accountant is a costly affair, especially for small businesses, where a full-time employee might not have enough work to justify their position. However, whether you outsource your accounting or hire an in-house employee, there are always challenges.
When you start consulting with various specialists, you'll realize that everyone has a different opinion. One of the problems with outsourcing is the presence of many incompetent specialists and companies offering accounting services *“along with visas”*, without paying proper attention to the laws and accounting standards. Indonesian accountants that you can hire in-house typically lack formal education in taxation, or they may only have knowledge of specific taxes, as the courses that lead to tax certifications provide a limited scope of knowledge.
Unfortunately, even experienced professionals often make mistakes because, during their careers, they haven’t encountered contradictions in the legislation or the practical application of certain tax calculations.
Many agents charge for "zero reports." They recommend paying personal expenses from the company account and claim that accounting is a trivial task: just submit a couple of reports a year and that’s it.
Accounting in Indonesia is just regular accounting, governed by laws that are similar to the accounting systems used worldwide!
PT RMA is required to maintain full accounting records:
* Register all internal processes;
* Receive goods with proper documentation and put them on the balance sheet, from where they cannot simply disappear;
* Report on all incoming and outgoing payments;
* Regularly file tax reports.
We constantly continue our education, update our knowledge, and challenge all assumptions. For the position of an accountant in our company, we conduct at least 20 interviews because having a degree and certificates means NOTHING when it comes to actual knowledge of accounting.

The overused statement that “In Indonesia, everyone pays 0.5%” is not exactly incorrect, but it’s important to understand that things aren’t as simple as they may seem at first glance.
Almost every type of activity involves additional taxes, and the widely known "0.5%" tax also has its own limitations.
Let’s break it down:
0.5% – or PP55 – is a preferential tax that may be assigned to young companies, and it is paid on all incoming funds to the company’s account (excluding, of course, capital investments). It is not mandatory; you can immediately opt for a profit tax, avoiding the preferential rate.
A company, regardless of its desire, loses the right to the preferential tax once it crosses the income threshold of 4.8 billion IDR within the calendar year. After that, it is obligated to switch to Corporate Income Tax PPh25/29 starting January 1st of the following year.
This means that the company will have to pay 22% on profits (this tax has a preferential rate of 11%, calculated on the first 4.8 billion IDR).
Also, when your revenue reaches 4.8 billion IDR within the calendar year, you are required to become a VAT taxpayer, obtaining the PKP status the following month.
Often, the preferential CIT rate (11%) is combined with the outdated VAT rate of 11%, and people refer to it as a 22% profit tax, but this is highly incorrect! The taxes are calculated using entirely different principles, and saying that you will need to pay 22% to the government is like stating the “average temperature in a hospital” is 36.6°C.
Additionally:
* You can pay the preferential tax but still be a VAT payer.
* You can be on profit tax but not pay VAT.
* There are taxes that exclude the payment of profit tax.
* And many other fascinating nuances that lure with their depth and charm.
And there are also:
* Taxes on construction services.
* HoReCa taxes (for accommodation, restaurants, cafes, food delivery, spas, etc.).
* Taxes on services for businesses (all B2B contracts).
* Personal income taxes for employees and one-time contracts with individuals.
* Taxes on freelance contracts with specialists.
* Taxes on land acquisition and sublease.
* Taxes on services purchased abroad.
* VAT on medical services.
  And others.
We will explain to you what your obligations are and at what stages.

We believe no extra words are needed here. 
Anyone who has ever worked with 1C knows exactly what this system is all about! 
The capabilities of this system are hard to measure: from setting up payroll calculations for your specialists' hourly work to managing warehouse reporting. 
You won’t believe it, but the majority of Indonesian businesses still rely on simple .xls spreadsheets and paper notes to control their operations. We’ve brought 1C:Enterprise and customized it to meet local needs: three languages (English, Indonesian, Russian), calculation of all taxes and contributions, and much more. We manage our own accounting based on 1C:Enterprise, and we wish the same for you. 
Today, our clients are already using the ready-made product for payroll and personnel management. Some of our clients also manage their financial and inventory accounting with the tool we provided.

Starting a Business in Indonesia
For many years, starting a business in Indonesia was seen as a relatively informal process. Yes, people often mentioned the “investment capital” requirement of IDR 10,000,000,000, but it was commonly overlooked.
Let’s briefly discuss how things really stand now, especially considering the increased scrutiny of foreign-owned businesses.
PT – *Perseroan Terbatas* – translates to “Limited Liability Company”
PMA – *Penanaman Modal Asing* – means “Foreign Investment”
This type of company is subject to several restrictions:
* On a federal level, there is a Negative Investment List that outlines business sectors foreign companies cannot operate in. In addition, local regulations may restrict certain activities in specific regions.
* There are business categories where a company cannot be 100% foreign-owned.
* Each business line must be backed by a minimum investment of IDR 10 billion.
* There are additional requirements...
When the main incorporation document is signed, you guarantee to the government that you possess this IDR 10 billion in investment capital. Investment reports — known as LKPM — are a mandatory way to report how this capital is being allocated.
Based on the note of the law, having opened a business, you are obliged to repay the Invest Capital within the timeframes specified by law. Or enter into a dialogue with BKPM (investment control body) and agree on other conditions with them.

Partner Pricing for KITAS
*Kartu Izin Tinggal Terbatas* — a limited stay permit. This is not a visa — it’s a residence permit. It comes in two types:
* KITAS (Temporary): valid from 6 months to 2 years
* KITAP (Permanent): valid up to 5 years
Investor KITAS is not an obligation, but only an option for those people who have a business in Indonesia. You can establish a company and NEVER get a KITAS if you do not want to. But, you must remember that if you are a director, then according to immigration law, you are required to have a KITAS, and in order to have the right to work and receive a salary, you will need to get a working KITAS.

Moving on — under the new law effective November 1, 2023, if an investor’s personal contribution to the business is less than IDR 10 billion, they are not eligible for an investor KITAS.
Why was this law introduced?
We assume the answer is simple: to prevent companies from being set up solely to obtain KITAS permits, and to shut down fake organizations.
So, now you're choosing between an Investor KITAS and a Work KITAS.
Here’s a key point: why don’t we all just raise our declared investment amounts?
Because paid-up capital is not just a formality — it’s a legally binding requirement to open a business. If you fail to pay the initially declared capital, you may be able to explain yourself to BKPM. But if you increase your declared capital, you are legally required to pay the increased amount immediately.
Are you ready to invest IDR 10 billion?
If yes — go ahead and do it.
If no — then even though the Work KITAS may be more expensive at the start, it gives you more long-term rights.
* First, you can sleep peacefully knowing immigration won’t catch you on-site wearing a white hard hat.
* Second, the investment board won’t be surprised when you promise IDR 20-30-40 billion investments.