Help With Indo Tax Question

ferdie

you are supposed to start paying the tax if you: -reside more than 180 days (cut off period for living here) -getting an income here either by working or other income In my opinion you are not required to have one if you're not getting any income here or living here more than 180 days in a year but I might be wrong Better meet with one of those licensed tax consultant and get his written opinion, don't go knocking on one of those "agents" they would promise you can own the moon if you ask them :icon_wink:

ronb

Australia and indonesia have a tax treaty intended to avoid double taxation. My lazy interpretation of it is you pay Australian tax on income earned in Australia and Indonesian tax on income earned in Indonesia. But I am sure others could give a more learned interpretation of the treaty.

Forestrah

Hi, My husband is a freelance worker in Aus and gets paid by an Australian company. Will we need to pay income tax in Indonesia if we go there for an extended holiday even though he is getting paid in Australia to an Australian account and we are not permanently staying in Indo? Any advice would be greatly appreciated. We are not sure how long we will be holidaying in Indo. We will be traveling in and out for maybe 6 months or more? We are not sure as it depends on how much we like it and whether or not we find another spot in SE Asia that we may want to also spend a bit of time in. We are curious about this whole thing because if we do love being in Indo we are considering staying there long term. We are not sure what we will do about my husband's job if we decide this. But really he can do his job from anywhere. We just want to get more information on income tax laws as everything online is confusing and we want to make sure we are doing everything correctly. Thanks heaps in advance for your help.

davita

With respect to taxation Indonesia is similar to Australia, UK, Canada and many other countries around the world. Taxation is based on residency, employment, world-wide income and double taxation agreements with other countries. IOW it would be no different, in principle, if an Australian went to live/work in Canada or VV. The reality is that in Indonesia, much like their driving habits and other activity, hardly anyone complies with [B]law[/B]. If expats are actually working in Indonesia on a work permit (IMTA) and getting income from that source, they will need a Tax Reporting ID NPWP (called enpaywaypay). If income is singularly from overseas I don't know anyone who uses NPWP, even if permanently residing in RI. I've been retired here over 10 years and get pensions from 2 countries but don't have NPWP..I asked my visa agent and he said "Don't think about it unless you have a work permit." If an expat keeps interest earning deposits in an Indonesian bank, 20% of the interest will be tax deducted...a lesser tax can be applied with an NPWP but it risks having to declare other world-wide income and the pain of trying to comply with RI's ridiculous bureaucracy. With regard to the OP's question.....I wouldn't worry while still 'considering' living in RI and, when here, can see how things work on the ground with others in similar situations. There are many Australians here in Bali living as Fly-in Fly-out (fifo) workers Tax compliance of Indonesians is the Tax Authority's priority at present. It's reported that less than 20% of the population actually pay their required taxes, including money they've stashed away in places like Singapore. The future ...who knows!