Foreigners who want to start a business and generate income in Indonesia can establish a PT PMA. This foreign-owned company allows foreigners to invest foreign capital in Indonesia. Establishing a PT PMA costs money, so it’s essential to be aware of the PT PMA costs and prices involved in establishing a business in Indonesia.
How much does it cost to establish a PT PMA in Indonesia?
The costs to establish a PT PMA in Indonesia vary depending on several factors, such as the type of business sector the PT PMA is in, the way the PT PMA is established, and the location of the establishment. It can be cheaper to start a PT PMA in Jakarta than in Bali. In general, expect to pay between IDR 15 million ($975) and IDR 35 million ($2,275) to establish a PT PMA in Indonesia.
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PT PMA costs in Bali
Establishing a PT PMA in Bali costs between IDR 25 million ($1,625) and IDR 35 million ($2,275) on average.
PT PMA costs in Jakarta
Establishing a PT PMA in Jakarta costs between IDR 15 million ($975) and IDR 30 million ($1,950) on average.
Establish a PT PMA in 8 steps
Foreigners can set up an Indonesian PT PMA in eight steps:
- Approval for the company name: Ensure the company name is unique and allowed according to the requirements.
- Legalizing the Deed of Incorporation: A public notary must legalize this document, which typically takes around two days.
- Obtain approval of legal entity status: After the notary submits the Deed of Incorporation, the Ministry of Law and Human Rights must approve the legal entity status. This approval usually takes close to ten days.
- Register for a Tax ID (NPWP) and secure Taxable Entrepreneur Confirmation (PKP): Visit the tax office to get issued the NPWP and PKP, which are needed for opening a bank account, complying with tax duties, and acquiring business licenses. Expect this step to take around three days.
- Acquire a domicile letter: Get this letter from the local district authority to confirm the business location. The processing generally spans about three days.
- Obtain the Company Registration Certificate (TDP): This certification authenticates the company’s establishment. It typically takes nearly 14 days to obtain the TDP.
- Apply for NIB: Upon registration, the company will be granted the NIB, Business License, and Location Permit.
- Submit applications for additional licenses: You can now apply for various licenses depending on the company’s range of activities.
- Pay the PT PMA cost fee: After establishing, you pay the PT PMA costs to the legal expert who helped you with the establishment. The PT PMA cost can differ per location and legal service provider.
By following these steps, foreigners can establish a PT PMA and start their business in Indonesia.
Minimum investment and paid-up capital for PT PMA in Indonesia
According to Perka BPKM No4 Year 2021, foreign investors need to have the intention to invest at least IDR 10 billion ($650,000). The paid-up capital is set at 25% of the minimum required investment, which is IDR 2.5 billion ($162,500) and needs to be transferred to an Indonesian bank account. In reality, it’s not needed to invest these sums at the moment of establishment.
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Frequently Asked Questions (FAQs)
What is a PT PMA?
PT PMA, or Perseroan Terbatas Penanaman Modal Asing, is a foreign-owned limited liability company in Indonesia. It allows foreign investors to register a company in Indonesia and can be owned partially or wholly by foreign individuals or legal entities. PT PMA is governed by Indonesian law and is required for foreigners who wish to engage in business activities.
Do I need a PT PMA for investments in Indonesia?
Foreigners need to have a PT PMA to invest in Indonesia. This legal entity enables foreign investors to perform commercial activities and operate a business within Indonesian territory. The PT PMA costs between IDR 15 million ($975) and IDR 35 million ($2,275).
What is the Investor KITAS?
The Investor KITAS is a type of residence permit in Indonesia that allows foreign investors to reside there for investment purposes. It’s an essential visa for foreigners who are part of a business in Indonesia. It typically has validity for up to 24 months.
What is the minimum capital for a PT PMA?
The minimum capital requirement for a PT PMA in Indonesia is IDR 2.5 billion ($162,500). However, the Indonesian government periodically reviews and updates this amount, so it is advisable to check for the most current regulations or consult a legal expert for the latest information. Establishing a PT PMA costs between IDR 15 million ($975) and IDR 35 million ($2,275).