Indonesia: Taxes and Costs
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Rental income tax is high in Indonesia
Effective Tax Rate on Rental Income |
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| Monthly Income | US$1,500 | US$6,000 | US$12,000 |
| Tax Rate | 20% | 20% | 20% |
| Click here to see a worked example | |||
Source:
Disclaimer |
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INDIVIDUAL TAXATION
Nonresidents are liable to pay tax on Indonesian-sourced income. Married couples are taxed jointly.
INCOME TAX
The rental income of non-residents is taxed at a final withholding rate of 20% of gross income. Double-taxation agreements between Indonesia and other countries may reduce this to 10%. All expenses related to property rental are non-deductible.
CAPITAL GAINS TAX
Transfers of Indonesian properties are subject to tax. Capital gains tax is levied at a flat rate of 20% of the gross sale value of the property or the assessed value for property tax purposes, whichever is higher.
VALUE ADDED TAX (VAT)
10% Value-added tax is levied on gross rental income.
CORPORATE TAXATION
INCOME TAX
Local companies owned by non-resident individuals are taxed on gross Indonesian-source income at a flat rate of 20%.
CAPITAL GAINS TAX
Non-resident companies are liable to capital gains tax, at a flat rate of 20% of the gross sale value of the property.
Capital gains realized by resident companies are taxed at the standard corporate income tax rates. Costs incurred and capital losses are deductible.
CORPORATE TAX |
|
| TAXABLE INCOME, INR (US$) | MARGINAL TAX RATE |
| Up to 50 million (US$5,345) | 10% |
| 50 million - 100 million (US$10,689) | 15% on band over US$5,345 |
| Over 100 million (US$10,689) | 30% on all income over US$10,689 |
PROPERTY TAX
Property tax is levied at 0.5% on the assessed value of the property. The assessment value of taxable property is determined as a percentage of the deemed fair market value of the property, as follows:
- 40% for forestry and plantation land
- 20% for mining land
- 40% for any other type of land where the sale value of the land is more than IDR1 billion (US$106,893)
- 20% for any other type of land where the sale value of the land is less than IDR1 billion (US$106,893)
Indonesia - more data and information
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