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Insane financial investment.
Hi, I have posted a couple of times about investing in a business in Bali and am now on the lookout for more advice and opinions from the knowledgable people on this forum. Am also posting this on a couple of other forums.
I would be looking to buy into a tourist-related business (I know, don’t laugh yet). I’m a Brit if that makes a difference
My potential business partners are some old family friends who have lived here for about 10 years and their Indonesian partner. They say that, to help cut down on tax, the Indonesian chap is legally the registered owner of the business (and incidentally their home here) and they have an “overarching contract” with him to ensure that their interest in the business is registered. They tell me this is normal practice here and preferable to setting up a PMA.
Being slightly less besotted with Bali than my friends appear to be, this sounds insanely dodgy to me, particularly given the precedence Indonesians appear to take in most legal disputes here. I’ll be meeting this potential partner later in the week and am wondering if anyone can suggest specific questions I might ask during this meeting to clarify the exact position. Or if anyone has any idea what he might be up to, that would also be great.
It is a matter of trust wether you do or not. Your friends trust him but that does not mean you should. There are too many horror stories of being ripped off. My advice would be to bite the bullet and set up a PMA and hire yourself. Tax will have to be paid on earnings and profits no matter if it is a Indonesian or expat owned business.
Regards Jimbo
Well, if it already sounds dodgy at this stage...this sounds insanely dodgy to me
I suppose you need to ask the typical questions as you would with any investment decision.if anyone can suggest specific questions I might ask during this meeting to clarify the exact position
I know of people who "invested" in some kind of villa business only later to find out they owned absolutely nothing. They had no agreements or contracts and they transfered money to someone's bank account who didn't stick around for long.
Here is just one example of many that I am sure go unreported: Bali News: Missing the Plot in Bali
Maybe you could provide some more details as to exactly what your partner is proposing. You can't own property as a foreigner in Indonesia, but you can lease it in your own name, which could be one way to go. If your partner objects to you doing anything to protect your investment, that should set off some alarm bells.
Here is an old but good thread to read through: Lost my House to a Balinese in Ubud
Give a man a fish and he will eat for a day. Teach a man to fish and he will sit in a boat drinking beer all day.
Jimbo advice is right, setting a PMA will only help you!!!!!!!Originally Posted by Jimbo
You need to give a little more to the story, before we could give a better answer.
Ask yourself what benefits you will get out of this deal?????home???visa????income????
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