Indonesia

Viettonkin Consulting has been trusted by hundreds of entrepreneurs and corporations overseas for over 15 years to set-up businesses in Jakarta. We offer:

• Business Incorporation Services
• Cooperate Secretarial Services
• Compliance Services (Legal, Tax and Accounting)
• Corporate Banking Services
• Nominee Services
• Administrative Services
• Human Resource (HR) recruitment and management
• Global Payroll & Mobility

Various types of Indonesian entities are available for foreign investors, including wholly foreign-owned LLCs (PMA), local nominee-owned LLCs (PT), and representative offices. Each type offers different benefits, such as speed of setup, tax rates, and the ability to hire staff or bid for government contracts.

Foreign investors in Indonesia can engage in diverse sectors like infrastructure, manufacturing, and renewable energy, with tax incentives and corporate income tax reductions available. However, challenges include complex bureaucracy, infrastructure limitations, corruption, and a need for significant investments in skill development and infrastructure.

The Indonesian government offers various tax incentives, such as corporate tax reductions and exemptions for investments in priority sectors. However, foreign ownership can be restricted, and business registration processes may take months. Despite the potential for growth in sectors like ICT and renewable energy, foreign businesses face regulatory hurdles, including labor laws and a complicated tax system.

Viettonkin Consulting offers a full-service package for complete business incorporation and creates a streamlined and efficient process for foreign investors. We assists investors in managing the complex registration process, selecting suitable entity types, and ensuring full compliance with local regulations.

Indonesia possesses a host of opportunities and benefits for foreign investors:

• Indonesia has the largest economy in ASEAN
• Standard Chartered Bank estimates that Indonesia’s economy will grow from US$4.2 trillion in 2020 to US$10.1 trillion by 2030 to become the world’s fourth-largest economy in terms of purchasing power parity.
• Indonesia's abundant labor and natural resources make it an ideal destination for manufacturing ventures. The country leads in agricultural production and is rich in minerals, making it an attractive location for businesses in these sectors.
• Indonesia Special Economic Zones (SEZs) are the ideal environment to set-up businesses with their wide range of tax benefits and extensive infrastructure.
• Indonesia allows for foreign-ownership companies known as PMA.
• Indonesia is the world’s fourth most populous country (284.6 million) with a young demographic averaging 30 years of age. This makes Indonesia ASEAN’s largest labor market with over 130 million workers and the fourth largest labor market in the world.

Strategically located in the archipelago, Jakarta, the capital of Indonesia, is commonly dubbed as the gateway to the rest of the nation. It is a thriving economic hub that presents vast opportunities for investors:

• With a high population of 11.35 million, Jakarta is a bustling metropolis with plenty of market potential. This number is projected to rise even further in the future, giving rise to a large and growing market.
• Jakarta is a port city, making it a key center for trade. It also has a strategic location that makes it a hub for businesses, residents, and tourists.
• Jakarta has an advanced seaport, international airport, and a network of toll roads. Port of Jakarta (Tanjung Priok Port) is the country’s largest seaport, with an annual traffic capacity of around 45 million tons of cargo and 4,000,000 TEU's.
• Jakarta's main sectors include banking, trading, financial services, manufacturing and servies. It's top industrial sectors include automotive, electronics, mechanical engineering, chemicals and biomedical sciences manufacturing. Hence, there are many promising sectors in Jakarta.
• There are many industrial and economic zones in Jakarta such as the East Jakarta Industrial Area (EJIA) and the Jakarta Bay Industrial Zone (JBIZ), providing many benefits to businesses.

Indonesia’s underdeveloped economic structure creates several obstacles for foreign investment. These barriers have included the following in the past:

• Complex and Difficult Incorporation Process: Company registration in Indonesia, particularly for a PMA (Foreign Investment Company), requires a minimum of US$616.9 million investment capital. The process can take up to three months, with challenges including government bureaucracy, corruption, and complex regulations. A special business license is often required, adding to the administrative burden.
• High Taxes: Corporate tax is 25%, with capital gains taxed up to 30%. However businesses in SEZs and Indonesia's various international treaties can help to lessen this burden.
• Difficult Profit Repatriation: Moreover, foreign investors face restrictions on repatriating profits and may encounter difficulties in sectors like oil and mining due to national sentiment and regulatory issues.
• Economic Instability: Indonesia is still heavily dependent on the export of a few commodity products, such as rubber, petroleum, and tin, which are sensitive to any external market fluctuations.
• Lack of Domestic Savings/Capital Markets: Limited domestic savings and reduced development of capital markets hinder the internal capacity to generate funds for large-scale industrialization.
• Inadequate Infrastructure: The infrastructure for transport, communication, and energy is underdeveloped; thus, this sector hampers industrial development.
• Labor Issues: Indonesia has an inadequate supply of skilled labor. Labor productivity is low; therefore, it affects the efficiency in industries.
• Low Per Capita Income: Low per capita income implies a very limited domestic market; hence, it limits possibilities for internal consumption of industrial products.

With development, these obstacles should gradually decline over time, as they have in the course of development in other nations.

State-owned companies, private banks, Islamic banks, international banks, and regional development banks are all part of Indonesia's financial system, and each one contributes differently to the nation's overall economic structure.

By 2024, Indonesia will have more than 24.3 thousand bank offices and 106 commercial banks, including 8 foreign banks. In terms of assets, the biggest banks in Indonesia are Bank Rakyat Indonesia, Bank Mandiri, and Bank Negara Indonesia. However, Bank Indonesia (BI), Indonesia's central bank, oversees and regulates payment systems and foreign exchange control.

Overview

• By June 2023, the Indonesian banking industry's profitability had increased to 2.7%, surpassing pre-pandemic levels. The subsidence of credit costs, which experienced considerable increases during the epidemic, was primarily responsible for the growth.
• Banking credit and financing (Commercial Banks) is still developing rather well in 2024, thanks to household consumption, particularly from the upper middle class, which is steadily increasing, and corporate activity that is still at the level of expansion.
• In 2024, the risk profile of commercial banks was quite well managed, reflected in declining credit risk and adequate liquidity conditions. In addition, market risk is also quite maintained in line with the bank's efforts to balance its SSB (bonds' portfolio rebalancing) portfolio.
• BI is well known for its ability to combat inflation. With public debt of 40.1 percent of GDP in 2022—already low when compared to peers—and projected to continue to drop over the long term, risks to debt sustainability are well contained. In 2024, BI reduced its target band by 50 basis points to 2.5±1 percent, continuing its steady disinflation approach that started in the 2000s.
• Four banking-related provisions were issued by the Financial Services Authority (OJK), namely in the form of POJK. Transparency and Publication of Credit Base Interest Rates for Conventional Commercial Banks, SLIK Reporting and Requests, Anti-Fraud Strategy for LJK, and BPR/S Governance are all generally governed by the four clauses.
• The issuance of OJK Regulation Number 27 of 2024 concerning the Implementation of Digital Financial Asset Trading Including Crypto Assets (POJK 27/2024) on December 24, 2024, confirms OJK's preparedness to perform the responsibilities and functions of supervision of Digital Financial Assets and welcomes the transition of supervision of Crypto Assets.

Full-Service Company Set-up Package

• Company Incorporation

  Provide expert guidance in selecting business locations, conducting market assessments, identifying the optimal business structure for clients, and handling document preparation to be submitted to relevant authorities for business registration.

• Corporate Secretariat Services

  Develop detailed work plans, track schedules, and provide reminders. We will also handle meeting logistics and assist with venue selection and management for registered locations as well as research and update clients on relevant legal documents and changes.

• Compliance Services

  Assist with the drafting, finalization, and submission of required periodic reports to regulatory authorities and handle applications for any additional licenses required throughout the enterprise's operations.

• Corporate Banking Services

  Collaborate with banks on behalf of our clients for matters related to opening or closing accounts, updating account information, and facilitating money transfers.

• Tax Advisory Services

  Advise companies on a wide range of domestic and international tax issues, including understanding their global effective tax rate, assessing tax impacts of business restructuring, and preparing for new and upcoming regulations. We help companies implement effective strategies to manage tax obligations and increase earnings and cash flow.

• Additional Services

  Offer Nominee Services, Administrative Services, Legal Services, Human Resource Management, and Accounting & Tax.

Sole Proprietorship (UD)

Sole proprietorships or Usaha Dagang is the simplest form of company in Indonesia as it requires only one person to run the business. There is no legal difference between the owner and the sole proprietorship.

Requirements:

• A company name;
• Employee identification number;
• Domicile Letter; and
• Business license.

Limited Liability Company (Perseroan Terbatas – PT)

A PT is a legal entity where capital is divided into shares, and shareholders are liable only up to their shareholdings. Being an independent legal entity, it is distinct from the shareholders and runs its own business. It requires approval from the Indonesian Investment Coordinating Board (BKPM) but can operate nationwide and import goods, hire foreign staff, and sign contracts with Indonesian clients. There are two types of PT in Indonesia:

• Local PT company; and
• Foreign-owned PT PMA company.

Requirements for a foreign-owned PMA company:

• Two foreign individuals or corporations, or a combination with local shareholders;
• At least one local director; and
• One foreign or local commissioner.
• The capital invested must be a minimum of IDR 10 billion (~USD 617,000). IDR 2.5 billion (~USD 154,000) must be paid-up capital (25%), and the company has to be categorised as large companies.

Requirements for a local PT company:

• One local director
• Two local shareholders
• One local commissioner

There are three different sizes of local PT companies, which are based on the amount of capital invested:

• Small: Above IDR 50 million – 500 million
• Medium: Above IDR 500 million – 10 billion
• Large: Above IDR 10 billion

Representative Office

There are three types of representative offices in Indonesia:

• Foreign representative office;
• Foreign construction representative office; and
• Foreign trade representative office.

The representative office can only conduct market research, promotional activities and act as buying or selling agents for the foreign parent company. The license for this company will expire after two years and needs to be renewed in order to carry on business in Indonesia. It requires a lease agreement in Indonesia's capital. The office must not produce any profit in Indonesia, and all commercial transactions must be managed by the foreign parent company. There is no minimum capital required, unlike other foreign-owned companies in Indonesia, and registration is faster. However, there must be a chief officer who lives in the country. Representative offices also allow the employment of both local and foreign employees.

Limited Partnership (Commanditaire Vennootschap – CV)

There are two kinds of partners in a CV: general partners with unlimited liability, who manage the business, and limited partners whose liability is limited to the extent of investment and who usually stay out of management.

Requirements for CV:

• A minimum of two individuals acting as the founder of the company;
• The founders must be Indonesian citizens;
• A notary deed in Bahasa Indonesian; and
• 100% local ownership.

Partnership (Firma)

A Firma is a type of organization that is owned by two or more owners who are personally liable for the firm’s liabilities. It finds extensive applications in professional fields such as law, accounting, and consulting, where a number of partners are involved with regard to management and liability.

Requirements for Firma:

• Must have at least two or more company founders;
• Have goals and objectives that do not contradict with the Indonesian laws and regulations;
• Have a firm name;
• Have a place of business; and
• Have a board appointed by the founders.

In some countries like Indonesia, having a foreign with KITAS (work visa) is not enough, and a resident director is a legal requirement for entrepreneurs incorporating a company in a certain sector. The resident director must be a local citizen or a foreign national with a valid residency permit, possessing a local address and currently living in the country.

How can Viettonkin Assist?

Our nominee services provide confidentiality and operational support for companies aiming to protect their identities and ensure compliance, particularly valuable for businesses entering new geographic markets. Through the services, a third-party entity will be appointed as a representative, allowing the actual owner’s identity to remain private. It can be very useful for businesses to maintain discretion or comply with local requirements without revealing ultimate ownership. The representatives we appoint are of the highest standards, with years of relevant experience, no criminal record and no conflicts of interest.

Services Provided

• Our nominee services include professional directors, selected for their clear and trustworthy backgrounds at the client’s request. These representatives are legally appointed to act on behalf of clients in company operations, ensuring compliance and privacy.
• We meticulously draft contracts and security measures to safeguard the representation process, securing the client’s interests.
• We also take full responsibility for all representative activities related to the client's company, ensuring transparency and trust in all operations conducted on behalf of the client.

Setting up a business in a foreign country is challenging, especially considering the complex and intrigate regulations that differs from country to country. Significant time and effort are required to comprehend and overcome these variances: researching the target country and its people, fulfilling the legal requirements like licensing and accreditation standards, company registration, seeking the ideal location, assembling the assets, or finding the right and trustworthy talents. This problem is exacerbated if there is a difference in language and culture.

How can Viettonkin Assist?

Backed by years of experience and trusted by thousands of enterprises abroad, Viettonkin Consulting is in a good position to facilitate your foreign direct investments and company registration in key markets. We provide the full range of company incorporation services and beyond that simplifies the process for you and alleviate your burden:

• Step 1: Choose a Business Structure and Determine the Industrial Business Classification Code (KBLI)

  After signing the engagement letter, we will organize a meeting with the client to discuss the direction going forward. Afterwards, we would draft a comprehensive project plan that details all the steps and the timeline involved. A Foreign-owned Company / Penanaman Modal Asing (PMA) is considered to be a wholly or partially foreign owned limited liability company which is governed by the Foreign Capital Investment Law and approval from Capital Investment Coordinating Board (BKPM) is required before incorporation. Viettonkin Consulting will assist in preparing all the required documents and ensure swift application success. Additionally, we would also guide our clients to determine the industrial business classification code (KBLI) based on the intended business activities.

• Step 2: Reserve the company's name

  We will assist our clients in reserving a company name with the Ministry of Law and Human Rights (which should not be similar to the name of other company).

• Step 3: Obtaining A Deed of Establishment

  After reserving the company name, Viettonkin Consulting will provide guidance in executing the following procedures immediately:

  • Shareholders present the Deed of Establishment, which must be legalized by a local public notary.
  • All shareholders sign the Articles of Association in the presence of the notary.
  • The notary submits the Deed of Establishment to the Ministry of Justice and Human Rights for approval.
  • The Ministry issues a Decision Letter/Decree (SK Menteri Hukum dan HAM), confirming the company’s registration as a legal entity.

• Step 4: Obtain a taxpayer identification number, a tax registration certificate and a domicile letter

  Next, we will prepare all the necessary documents and:

  • Obtain a taxpayer identification number and a tax registration certificate from the local tax office
  • Obtain a domicile letter from the district government
  • (Note: Businesses established in Jakarta do not require a domicile letter).

• Step 5: Obtaining a Business

  To complete incorporation, Viettonkin Consulting will help clients to and create account on the OSS system and obtain the Identification Number (NIB) through the OSS system.

  • After gaining access to the OSS system, business actors must complete business actor data (company profile and capital structure) and general plan of business activity
  • The OSS system shall issue the NIB as an identity and legality to carry out business preparations, then it will automatically send a notification of NIB issuance to ministries/agencies, provincial Office of Investment and One-Stop Integrated Service

• Step 6: Apply for other relevant documents and licenses

  Different types of businesses require various business licenses. Depending on the nature of the business, we will help clients to apply for licenses to be allowed to start the operations. Business licenses will be issued based on the assessment of ‘business risk level’, determined by the scale of hazards a business can potentially create. With the services of Viettonkin Consulting, we will secure the licenses needed by the company with high-quality applications.

• Step 7: Opening bank account

  We will collaborate with banks on behalf of our clients for matters related to opening or closing accounts, updating account information, and facilitating money transfers.

• Step 8: Company Secretarial Services

  Running a business is no easy task. We aim to lessen the client's burden by helping to oversee and manage all activities involved throughout the corporate secretary acquisition process, including the preparation of all documents related to capital contributions and share allocations.

  • We will develop detailed work plans, track schedules, and provide reminders.
  • We will also handle meeting logistics assist with venue selection and management for registered locations as well as research and update clients on relevant legal documents and changes.
  • If need be, we will assist the client to submit applications for any additional licenses required throughout the enterprise's operations.

• Step 9: Human Resource Management

  We will support our clients' recruiting strategies to attract the best talent.

  • At the same time, we shall support our clients with applying for approving of labor demand, applying for Work Permit/Work Permit Exemption, VISA, health check, police clearance certificate.

• Step 10: Administrative Services

  To maximise the efficiency of business operations, we will organize and maintain the company’s internal documents.

  • We will also translate documents between Bahasa Indonesia and English, manage copies, and facilitate notarization of business documents at appropriate agencies.

To attract more foreign investors and boost economy growth, the Indonesian government has created Special Economic Zones (SEZs) filled with tax incentives and various benefits. As of 2024, Indonesia has at least 24 SEZs, with many more in the midst of construction. SEZs are split into three sectors: Service, Manufacturing and Processing.

Fiscal Benefits

• Companies investing at least IDR100 billion (USD 6.9 million) can receive 10 years of tax holiday.
• Companies investing at least IDR500 billion (USD 34.5 million) can receive 15 years of tax holiday.
• Companies investing at least IDR1 trillion (USD 67 million) can receive 20 years of tax holiday.
• Tax Allowance applies to activities outside the main activities of the SEZ, such as
  • Reduction in net income of 30% of the amount of invested, pro-rated at 5% for 6 years
  • Lossess carried over for 10 years
  • Accelerated depreciation and amortization
  • Tax on dividends 10% or lower
• VAT or VAT and Luxury Goods Tax are not levied on the delivery of certain Tangible Taxable Goods from TLDDPs, free zones, and bonded stockpiles to Business Entities and/or Business Actors; import of certain Tangible Taxable Goods into SEZs by Business Entities and/or Business Actors; import of Consumer Goods into tourism SEZs by Business Entities and/or Business Actors; etc
• Import Duty Exemption in the context of the construction or development of SEZs.
• For SEZs that have completed the construction and development stages, import duties are exempted for Consumer Goods and there is a suspension of Import Duty for business fields in SEZs
• For the purpose of supervision, part or all of the SEZ can be designated as a Customs Area
• Though SEZs have a minimum investment threshold of IDR10 billion (USD 690,000), excluding land and buildings, tech start-ups are exempt from this commitment.
• An Indonesian SEZ company can access a network of double tax treaties.

Non-fiscal Benefits

• The SEZ company structure allows for 100% foreign ownership. A local Indonesian shareholder is not needed.
• SEZs offer a one-stop service for licensing and other non-licensing services.
• Tenant does not need building permit if the developer has established Estate Regulation.
• Rights to use land and building rights can extend up to 80 years. Procedures can be accelerated too.
• Immigration incentives including extension of visas on arrival 5 times, limited stay permits and recidence permits
• Environmental licenses can be authorized by developers
• Indonesia National Standard not mandatory

Resident Director

In some countries like Vietnam, having a resident director is a legal requirement for entrepreneurs incorporating a new limited liability company. The resident director must be a local citizen or a foreign national with a valid residency permit, possessing a local address and currently living in the country.

How can Viettonkin Assist?

Our nominee services provide confidentiality and operational support for companies aiming to protect their identities and ensure compliance, particularly valuable for businesses entering new geographic markets. Through the services, a third-party entity will be appointed as a representative, allowing the actual owner’s identity to remain private. It can be very useful for businesses to maintain discretion or comply with local requirements without revealing ultimate ownership. The representatives we appoint are of the highest standards, with years of relevant experience, no criminal record and no conflicts of interest.

Services Provided

• Our nominee services include professional directors and shareholders, selected for their clear and trustworthy backgrounds at the client’s request. These representatives are legally appointed to act on behalf of clients in company operations, ensuring compliance and privacy.
• We meticulously draft contracts and security measures to safeguard the representation process, securing the client’s interests.
• We also takes full responsibility for all representative activities related to the client's company, ensuring transparency and trust in all operations conducted on behalf of the client.

Money Remittance Business

Setting up a money remittance business is complicated as it involves many complex procedures and tedious paperworks. Viettonkin Consulting's expert consultants are equipped with extensive industry knowledge and practical experience to guide our clients through every step of establishing and managing a this business:

• Step 1: Company Registration

  We will assist our clients with all necessary procedures and applications for registering a new company.

• Step 2: Banking

  After registration, we will collaborate with banks on behalf of our clients for matters related to opening or closing accounts, updating account information, and facilitating money transfers.

• Step 3: KYC/AWL/CTF Compliance Programe

  We will develop and implement KYC/AWL/CTF Compliance Programe.

• Step 4: MSB License Application

  We will execute the necessary procedures to apply for a Money Service Business (MSB) license and pursue rapid approval.

• Step 5: Post-Incorporation Support

  We will provide full post-incorporation support such as Corporate Secretarial Services, Compliance Services, Administrative Services, Legal Services, Accounting & Tax Services, Linguistics Services and Human Resource Management.

For any other operation needs, please refer to our full list of services offered.

In a world of unpredictability and financial uncertainty, businesses are regularly presented with complex financial situations and decisions. Some of these situations present valuable opportunities, such as acquisitions or expansions, while others require you to protect yourself in litigation matters or financial disputes. However, those demanding financial decisions and situations often require expertise outside the realm of businesses' internal resources - resources that may already be stretched thin.

Viettonkin Corporate financial advisory team specializes in helping organizations manage major transitions and accounting issues, while mitigating threats that can pose significant risks. We apply our professional experience, competencies and methodologies to navigate complex corporate financial situations smoothly and with minimal disruption to the organization. Our deep knowledge of the corporate financial landscape and our experience in a variety of industries allow us to provide objective advice for your complex challenges.

Our Services Include:

• Divestitures
• Capital Services
• Project Finance
• Trade Finance
• Market Entry Strategy
• Go-To Market Strategy

Tax Incentives

Companies investing in certain industries can enjoy a 30% reduction of CIT, which is based on capital investment deducted over six years at 5% per year.

• Companies are allowed to accelerate the depreciation of fixed tangible assets.
• Tax losses can be carried forward for up to 10 years.
• Companies investing over 500 billion rupiah (approximately US$33.3 million) may enjoy a 100% CIT reduction for five to 20 years.
• A company can enjoy 300% deduction of gross income for R&D expenses if such expenses are for the development of the national economy, the introduction of new technologies, or the transfer of foreign technology to local companies.
• Some imports for use in production may be duty-free to help reduce business costs.

Free Zones

Special Economic Zones (Kawasan Ekonomi Khusus or KEKs)

Integrated Economic Development Zones (Kawasan Pengembangan Ekonomi Terpadu or KAPETs)

Bonded Stockpiling Area (Tempat Penimbunan Berikat)

FTZ (Kawasan Perdagangan Bebas)

Industrial Zones (Kawasan Industri or KIs)

Numerous benefits will be provided for setting up businesses using these zones, such as tax holidays and extensive infrastructure

Non-fiscal Benefits

The Job Creation Law (Omnibus Law) has simplified investment and licensing procedures, making it easier to conduct business.

Foreign investors can have full ownership of businesses in most sectors other than certain industries that require special requirements.

Viettonkin Consulting offers guidance in financial, tax, legal, and management areas to help businesses tackle complex challenges, streamline operations, and reach strategic goals. We enable informed decision-making, and improve business efficiency to optimize cash-flow of the company.

• Cash Flow Analysis and Forecasting

  Service: In-depth analysis of existing cash flow patterns and reliable forecasting to estimate future cash requirements.

  Benefit: Assists businesses in determining the timing of cash shortages and enables them to make necessary plans.

• Working Capital Management

  Service: Optimization of working capital components, including inventory, receivables, and payables.

  Benefit: Ensures efficient use of resources and improves liquidity.

• Debt Restructuring and Management

  Service: Analysis and restructuring of current debt to minimize interest costs and improve repayment terms.

  Benefit: Reduces financial burden and enhances cash flow.

• Expense Reduction Strategies

  Service: The service provides identification and implementation of cost-cutting measures, ensuring no compromise on quality or performance.

  Benefit: Frees cash for other vital business needs.

• Revenue Enhancement Strategies

  Service: Formulate strategies to increase sales and enhance revenue streams.

  Benefit: Influx of overall cash is increased.

• Tax Planning and Optimization

  Service: Formulate strategies to minimize tax liabilities and maximize tax benefits legally.

  Benefit: Liberates more money for operations.

• Banking and Financing Solutions

  Service: Assistance with loans, lines of credit, and other types of financing.

  Benefit: Provides additional cash flow sources to support business operations.

• Risk Management and Contingency Planning

  Service: Identification of potential financial risks including variable costs and development of contingency plans.

  Benefit: Ensures the business is prepared for unexpected cash flow disruptions.

• Human Resource Optimization

  Service: Maximise staff productivity and enhance working skills. Search for high-quality outsourcing if necessary.

With over 15 years of experience working with foreign partners, we are proud to have helped many large customers and partners eliminate all language burdens and become successful overseas.

Our cultural and linguistic solutions not only aim to aid our clients communicate effectively with their external stakeholders, but also faciliates strong internal connection across staff of diverse backgrounds, and nurture outstanding employee experience for their entities.

Additionally, our global marketing strategies optimize clients' marketing and sales strategy to drive profitable growth by drawing together insights from their customers, markets, business environments and internal organization.

Viettonkin assists business in creating unique and tailored marketing & sales strategy, right down to individual products, programs and customers segments. Our services include:

• Localization

  Localization is such an important step for a company to expand its business in a foreign market and communicate with the global workforce. As a result, Viettonkin provides localization services with a view to assisting clients' teams in conveying the natural content to international businesses:

  • Website localization: Websites are a platform where a company offers products and connects with customers, hence a professional website will bring a great customer's experience in the digital environment. Website localization is not just the translation of texts. The process includes tailoring the language and designing responsive websites to attract customers.
  • Training materials: Training programs nowadays are not only delivered by paper manuals but also presented in the form of computer-based training sessions, web-based training, video presentations. As a result, training material localization service requires the involvement of translators, editors, desktop publishers, multimedia specialists, voice talents, producers and so forth. Viettonkin provides the entire package of training material localization.

• Copywriting

  Effective copywriting tells a story. Several of Google's latest updates have had a strong focus on effective, user-friendly copy that helps answer searchers questions. At first glance it seems to be an easy task, just only a few words, but in fact it requires understanding the readers 'psychology so that copywriters can stimulate customers' interest in the product. Additionally, clients also have to ensure SEO that makes it easy for Google to track that article. Viettonkin knows not only how to write - and write well - but also write in a way that serves both people and algorithms:

  • We create a content marketing strategy that aligns with your core values and your audiences' wants, needs, and preferred ways of consuming content.
  • We produce effective content to use throughout your website, SEO-friendly descriptions to help your products rank, strong and succinct email campaigns, or blog posts that boost your visibility and credibility as an expert.

• Other Marketing Strategies

  • Digital Marketing
  • Communication Strategy
  • Competitive Intelligence
  • Brand Consultation

Indonesia's Tax Rates

• Personal Income Tax (PIT):
  • Up to IDR 60 million - 5%
  • Above IDR 60 million to IDR 250 million - 15%
  • Above IDR 250 million to IDR 500 million - 25%
  • Above IDR 500 million to IDR 5 billion - 30%
  • Above IDR 5 billion - 35%
• Corporate Income Tax (CIT): 22%
• Value-Added Tax (VAT): Starting 01 January 2025, it would be 12% for sales within Indonesia and import of goods. 0% for export of goods.
• The annual land and buildings tax, also known as Pajak Bumi dan Bangunan, or PBB, is due at a maximum of 0.5% of the market value as established by the regional government.
• In a land and building transfer, the buyer is responsible for paying 5% of the transaction value or the market value set by the local government for the acquisition of land and building rights (Bea Pengalihan Hak atas Tanah dan Bangunan, or BPHTB).
• Public firms are eligible for a 3% tax discount off the regular rate, which results in an effective tax rate of 19%, provided they meet a minimum listing requirement of 40% and other requirements.
• A 50% tax rebate of the ordinary rate, applied proportionately to taxable income on the share of gross turnover up to IDR 4.8 billion (US$295,000), is available to small businesses (i.e., corporate taxpayers with an annual turnover of no more than IDR 50 billion rupiah (US$3 million)).
• The standard 22% CIT rate applies to branch profits. Regardless of whether the money are sent back to the home country or not, the after-tax profits are subject to a 20% withholding tax (WHT), also known as branch profits tax or BPT. However, WHT can be reduced with a tax treaty.
• Luxury Service Tax (LST): Luxury homes and automobiles are subject to LST at import or manufacturer-delivered rates, which currently range from 10% to 95%.
• Sale of shares on Indonesian stock exchanges is subject to a 0.1% final income tax rate on the proceeds.

Tax Filings

Monthly Deadline:

• CIT/PIT - Payment: 15th of following month. Report: 20th of following month.
• Article 21/26 Income Tax (Payroll) - Payment: 10th of following month. Report: 20th of following month.
• WHT - Payment: 10th of following month. Report: 20th of following month.
• VAT/LST - Payment: Before VAT and LST returns submission. Report: End of following month.

Annual Deadline:

• CIT - Payment: Before CIT return submission. Report: 20th of following month. End of fourth month after fiscal year ends.
• PIT - Payment: 15th of following month. Report: 20th of following month. End of third month after fiscal year ends.

Notes for Consideration:

• In Indonesia, the calendar year serves as the fiscal year. For companies, it can be a different accounting period, but must be of 12 months’ duration.
• When Indonesian businesses apply for a specific tax refund, the Tax Directorate General will also conduct a tax audit.
• With the implementation of an electronic filing system that allows businesses to submit their tax return electronically, Indonesia has entered the digital era regarding tax administration.
• The delayed payment of taxes results in interest penalties calculated at a rate derived from the Ministry of Finance Interest Rate (MIR) in addition to a surcharge. Furthermore, for late reportings, there will be IDR500,000 penalty for VAT returns, IDR100,000 for other monthly tax returns and annual PIT returns, and IDR1 million for annual CIT returns.

How Viettonkin Will Benefit You

• We help clients efficiently to fulfill your tax rights and obligations, ensuring their declaration and payment processes are convenient, transparent, effective with reasonable cost.
• We offer a guidance on legal compliance, risk minimization, and maximizing tax incentives to achieve the most favorable tax outcomes.
• We will handle transactions and communications with tax authorities to protect client rights and interests fully.

Withholding Tax in Vietnam

The full list of WHT on different incomes can be viewed in https://taxsummaries.pwc.com/indonesia/corporate/withholding-taxes

DTAA

Indonesia has signed more than 71 Double Tax Avoidance Agreements (DTAAs) as of 2024. The DTAAs are critical in preventing businesses and foreign investors from being double-taxed on their income, which frees up cash for other important uses.

The following are the agreed taxes for Dividends, Interests and Royalties of Indonesia with other ASEAN countries.

• Non-Treaty
• Dividends | Interests | Royalties:
• Resident Companies - 0% | 0%/10%/15%/20% | 15%
• Resident Individuals - 0%/10% | 0%/10%/15%/20% | 15%
• Non-resident Companies - 20% | 10%/20% | 20%
• Non-resident Individuals - 20% | 10%/20% | 20%
• (Generally, it's 15% for residents, 20% for non-residents, but certain variables apply)
• Vietnam
• Dividends - 15%
• Interests - 0%/15% (Exempt if paid to government)
• Royalties - 15%
• Thailand
• Dividends - 15%/20%
• Interests - 0%/15% (Exempt if paid to government)
• Royalties - 15%
• Singapore
• Dividends - 10%/15%
• Interests - 0%/10% (Exempt if paid to government)
• Royalties - 8%/10%

ASEAN Corporate Tax Rates in 2024:

• Brunei Darussalam

  - 18.5%

• Cambodia

  - 20%

• Indonesia

  - 22%

• Lao PDR

  - 20%

• Malaysia

  - 24%

• Myanmar

  - 22%

• Philippines

  - 25%

• Singapore

  - 17%

• Thailand

  - 20%

• Timor-Leste

  - 10%

• Vietnam

  - 20%

In order to work in Indonesia, it is legally required for foreign investors and their employees to possess Employment Visas. Viettonkin Consulting will assist clients with determining the appropriate visas to apply for and support them throughout the tedious application process to increase the chances of successfuly applications.

Types of Work Visas in Indonesia:

• Izin Tinggal Terbatas (ITAS)

  The Indonesia Directorate General of Immigration may issue the ITAS, a limited-stay permit, to foreign workers via a local immigration office. However, A Visa Izin Tinggal Terbatas (VITAS), an Indonesian limited-stay permit, must be obtained before an applicant can obtain an ITAS. There are different types of ITAS, namely the Urgent ITAS, Short-Term ITAS and Long-Term ITAS.

  • Duration:

    • Urgent ITAS - 30 days, no extension.
    • Short-Term ITAS - 2-6 months, no extension. Permit must be cancelled by employer.
    • Long-term ITAS: 7-12 months, can be extended for up to 4 times. During the extension of the visa, the foreign worker do not need to leave Indonesia. Permit must be cancelled by the employer.

  • Recommended for:

    • Urgent ITAS - It has fast processing time and is cheap to apply. Hence it is perfect for ad-hoc or urgent projects
    • Short-term ITAS - Short-term projects
    • Long-term ITAS - Long-term projects on a permanent basis

• Kartu Izin Tinggal Tetap (KITAP)

  International workers who have held an ITAS for at least three years in a row may be granted a permanent-stay visa, known as KITAP. There are different KITAPs, namely Investor KITAP, Working KITAP, Family KITAP and Retirement KITAP.

  • Duration:

    All KITAP - 5 years, extendable for a lifetime

  • Recommended for:

    • Investor KITAP - Foreign investors who have owned shares in an Indonesian company for at least 3 years
    • Working KITAP - Employed by and held a Working KITAS for an Indonesian company for at least three years.
    • Family KITAP - Foreigners married to Indonesian citizens, children of mixed-nationality marriages, or dependents (spouses and children) of an existing KITAP Holder.
    • Retirement KITAP - Foreigners who have held a Retirement KITAS for at least four years.

• Multiple Entry Business Visa

  For a year, foreigners with multiple entry business visas are permitted to visit Indonesia repeatedly. However, tourists must depart the nation before the visa expires in order to re-enter Indonesia because it has a 60-day limit upon entrance. This visa does not permit work and is only intended for engaging in meetings in the country, attending conferences, or undertaking market research. This visa is recommended for foreigners who enters Indonesia repeatedly.

Required Documents:

• For employers:

  • A completed visa application form
  • A business license
  • Their NPWP number for tax identification
  • A business license issued by the Indonesia Investment Coordinating Board (BKPM)
  • Foreign Worker Utilization Plan (Rencana Penggunaan Tenaga Kerja Asing (RPTKA))
  • A copy of the sponsor's ID card (KTP)
  • A copy of a local employee's KTP
  • Mandatory Manpower (Wajib Lapor) report
  • Business Identification Number (NIB)
  • Certain documents within the application must have the letterhead of the company and a company stamp
  • Certificate of Company Domicile (SKDP)
  • The company's deed establishment, authorized by the Ministry of Law and Human Rights

• For employees:

  • A copy of their passport, which must be valid for a minimum of 18 months
  • Proof of health insurance
  • Passport photos in color
  • A copy of the employee's highest degree of education, which must be stamped and signed by the employer
  • A copy of the applicant's CV, which should also be stamped and signed
  • A work certificate that shows the applicant has at least 5 years of relevant experience if necessary

Human Resource

Human resource is an invaluable asset of any organizations, playing the determinant role in leading the business to achieve success and conquer new heights. Mismanagement of workforce will inevitably result in business failures. Fully grasping the vitality of a productive, thriving workforce in achieving any corporate goals, Viettonkin Manpower, with our local expertise combined with global FDI intelligence, offers workforce solutions - process, system, policies, technology - to help our clients successfully build and manage a strong, efficient, innovative business team. Furthermore, we devote our efforts to serve newly established FDI clients transfer smoothly into a new environment, while assisting domestic firms in expanding abroad and transforming the way they do business following an international standard and mindset.

Mobility

• Support our clients with applying for approving of labor demand, applying for Work Permit/Work Permit Exemption, VISA, health check, police clearance certificate
• Advise clients on positions/titles and conditions for applying for Work Permit, Work Permit Exemption pursuant to Vietnamese Law to ensure compliance with the other relevant regulations

HR Consultancy

• Labor disputes and problems:
  • Define a clear framework to handle disputes and subsequent steps for resolution on the basis of minimizing costs for parties involved
  • Identify potential labor issues and work on preventative measures to avoid escalation of issues
• Legal updates: Providing legal updates with regards to HR & Labour matters in respective countries
• HR consultant: Consultancy for clients about the contents related to labor laws in businesses and solutions for circumstances in terms of labor.

HR Regulatory and Compliance

• Support our clients with labour regulation and procedures, employment contract drafting
• Consult on compensation & benefit (C&B)
• Advise on labor disputes and problems
• Assit in HR compliance report

Payroll Administration

• Support our clients with labour regulation and procedures, employment contract drafting
• Consult on compensation & benefit (C&B)
• Advise on labor disputes and problems
• Assit in HR compliance report

Recruitment

• Support our clients' recruiting strategies to attract the best talent
• Offer recuitment service in a wide variety of fields
• Help clients seek the most suitable candidates among a vast talent pool in the shortest time

Nominee Service

• Our nominee services include professional directors and shareholders, selected for their clear and trustworthy backgrounds at the client’s request. These representatives are legally appointed to act on behalf of clients in company operations, ensuring compliance and privacy.
• We meticulously draft contracts and security measures to safeguard the representation process, securing the client’s interests.
• We also take full responsibility for all representative activities related to the client's company, ensuring transparency and trust in all operations conducted on behalf of the client.

Whether you are currently recruiting, looking for advice on industry recruitment trends or simply want to source information on expected salary rates, we can help. Viettonkin Consulting Recruitment specialising in the recruitment of permanent, contract and temporary positions on behalf of the world’s top companies.

• We will deliver a fully comprehensive sourcing strategy that covers standard forms of sourcing as well as innovative solutions to ensure we are attracting the most suitable candidates in the market.

Step 1: Initial Consultation

We will start by having a comprehensive consultation with the client to understand their needs regarding hiring, the culture of the organization, and the specific requirements of the job. This includes meetings with key stakeholders to gain detailed information about the roles to be filled. Additionally, Viettonkin Consulting will study the current job market to understand the availability of talent, industry trends, and competitive salary benchmarks.

Step 2: Candidate Sourcing

• Using our extensive professional network built over the years, we will search for high-quality candidates matching the qualifications and skills stated by the company.

Step 3: Screening and Shortlisting

Our team assists the client in reviewing resumes to spot the candidates that fit the requirements of the job. We conduct initial phone or video interviews to assess candidates' qualifications and experience. Where appropriate, skills assessments, personality tests, and other forms of assessment are administered to further determine the suitability of candidates.

• Based on the initial screening, we will create a shortlist of the most promising candidates along with detailed profiles that include resumes, interview notes, and assessment results. Viettonkin Consulting will send across the shortlisted candidates to the clients for their review and response.
• We will also fix interviews between the client's hiring teams and the shortlisted candidates.

Step 4: Final Selection

We help our client make a final hiring decision through comparative analysis and recommendations from our assessments. Furthermore, we conduct negotiations of offers to make certain that the terms are acceptable both for the candidate and within your budget.

Step 5: Onboarding Support and Post-Hire Evaluation

• We support the client in developing a comprehensive onboarding plan in order to make sure everything goes well with the new hire.
• We will also keep in close contact with the new employee and the client's team during the first months to resolve any issues they may have for successful integration.

Finding the right office space is crucial for the success of any business, whether it’s a startup or a large corporation. Viettonkin Consulting helps in laying the foundations of our clients' business with office finding services.

• Step 1: Initial Consultation and Needs Assessment

  Viettonkin Consulting will meet with clients to understand their requirements regarding business needs, budget, preferred locations, and any other special requirements for office space.

• Step 2: Market Research

  We will conduct extensive market research to identify office spaces matching our clients' criteria. Once the research is compiled, a shortlist of properties is compiled for selection. This shortlist will include various options in location and building type for the client to choose from. Clients would also be able to choose the type of office they prefer - virtual, shared or permanent.

• Step 3: Property Tours and Evaluation

  Viettonkin Consulting will guide the clients through the shortlisted properties, where they can see if the space would work in person.

• Step 4: Negotiation of Lease Agreement

  We will aggressively negotiate with the landlord to obtain optimal lease terms and rental rates. The lease will be reviewed by our legal experts to ensure it is fair and protects the interests of the client.

• Step 5: Space Planning and Design

  Once the property is selected, the Viettonkin Consulting will aid in space planning to optimize such for functionality and efficiency. This could include working with architects and interior designers.

• Step 6: Move-In Coordination

  We will develop a detailed move-in plan for a seamless transition into the new office space-from movers to IT setup to facilities operational on the move-in date.

• Step 7: Additional Services

  On-ground support beyond the move is provided by us to resolve any issue that arises and to ensure full settlement of the clients in their new office space.

  For businesses that are growing over time, we will also provide relevant advice on planning for further expansion and if an expansion is decided, we will restart this whole process with the clients once more.

Intellectual Property (IP) refers to creations like inventions, designs, brand names, and artistic works that are legally protected to give creators exclusive rights. In today’s competitive market, IP is equally important for companies seeking to stand out with a unique identity. Registering trademarks, for instance, is essential to establishing brand ownership. It ensures that, in cases of infringement, the law protects the business’s exclusive rights, helping safeguard brand identity and maintain market trust.

Key IP Types

• Trademark Registration

  Trademarks are among a company’s most valuable intangible assets. Registering a trademark is essential for products and services to enter the market confidently, laying the groundwork for asset growth and brand recognition.

• Trademark Renewals

  Viettonkin guides you through the entire trademark renewal process, ensuring compliance with current legal requirements.

• Copyright

  Protect original works of authorship and prevent others from copying, distributing, or publicly displaying the work without permission, generally lasting the creator’s lifetime plus 70 years.

• Patent

  Protect inventions, granting exclusive rights to make, use, and sell an invention for a set period (usually 20 years).

Global Company Registration

• Incorporation
• Corporate Secretarial Services
• Compliance Services
• Corporate Banking Services
• Nominee Services
• Administrative Services

Legal Services

• Corporate Law
• Labour Law
• Mergers & Acquisitions (M&A)
• Dispute Resolution
• Intellectual Property
• Tax Litigation

Accounting and Tax

• Tax Compliance
• Advisory Service
• Accounting and Bookkeeping
• International Transactions

Human Resource Management

• Mobility
• HR Consultancy
• HR Regulatory and Compliance
• Payroll Administration
• Recruitment

Linguistic Services

• Localization
• Interpretation
• Copywriting
• Translation
• Transcreation

Market Readiness Assessment

• Pre-Feasibility Study
• Feasibility Study
• Market Research
• Business Matching
• Business Travel
• Business Development Consulting

Audit & Assurance

• Auditing Services
• Assurance Services
• Risk Assurance
• Valuation Services
• Transfer Pricing
• Internal Audit
• Corporate Governance
• Due Diligence
• Forensic
• Financial Statement Audit

Marketing & Sales

• Strategy Consulting
• Digital Marketing
• Experience and Design
• Communication Strategy
• Competitive Intelligence
• Brand Consultation

IT Services

• Digital Transformation
• Technical Services

Merger & Acquisitions

• Strategy and Readiness
• Due Diligence
• Valuation
• Pre-Closing
• Post-Closing

Trade & Procurement Consulting

• Trade Consulting
• Trade Brokerage
• Import & Export Compliance Consulting
• Procurement Sourcing
• Trade Consulting

Strategy & Corporate Finance

• Divestitures
• Capital Services
• Project Finance
• Trade Finance
• Market Entry Strategy
• Go-To Market Strategy

Tips for Successfully Investing in Jakarta (and Indonesia as a whole):

1. Understand the Regulatory Environment

   Understand Indonesia's legal and regulatory environment to ensure compliance with the same. Engagement with local legal experts will help understand and comply with such regulations.

2. Develop Personal Relations

   In the business culture in Indonesia, everything revolves around relationships. Thus, building a circle of good and trustworthy friends is very crucial, both among business colleagues and clients.

3. Establish Local Partnerships

   Work with reliable local partners who can help navigate the Indonesian business environment. Their insights will be helpful in understanding regulatory requirements and cultural nuances that may exist and will facilitate easier operations. Viettonkin Consulting is committed to become your business partner to navigate the business complexities and guide you to achieve success in your industry.

4. Localize to Engage Local Consumers

   Understand that the huge population in Jakarta is heterogeneous and consists of people with different tastes and preferences. Make deep insights from the market about your target audience and mold your products or services accordingly.

5. Be Patient and Persistent

   Building a successful business in Jakarta requires time and dedication. Be prepared to invest effort in understanding the local market and building your presence. Foreign investors may also need to be patient as authorities are the final decision-makers for all matters.

Interesting facts about Indonesia:

• Indonesia is one of the most culturally diverse countries in the world, with over 300 ethnic groups and more than 700 languages and dialects, making it among the most multicultural nations in the world. Its national language is Bahasa Indonesia.
• Located on the Pacific Ring of Fire, Indonesia contains about 128 active volcanoes, the largest number for any single country in the world. This also makes the country prone to earthquakes and tsunamis.
• Indonesia has the most significant number of Muslims in the world, with approximately 87% of the population identifying as Muslims. However, it is secular and recognizes six official religions.
• Indonesia has the second highest biodiversity in the world, only behind Brazil.
• Indonesia spans three time zones: Western Indonesia Time, Central Indonesia Time, and Eastern Indonesia Time.

Important facts about Indonesia:

• Indonesia is located on an archipelago that is one-eighth of the circumference of the Earth and extends over the Equator.
• Indonesia is the largest archipelago in the world, having over 17,000 islands, with about 6,000 being inhabited. Major islands include Java, Sumatra, Kalimantan, Sulawesi, and Papua.
• Indonesia is the fourth most populous country in the world, with a population of more than 275 million after China, India, and the United States. More than half of Indonesia's population lives on Java, making it the most populous island in the world.
• Indonesia is the largest country in ASEAN, and its largest city, Jakarta, is the largest city in ASEAN too.
• Indonesia is the largest palm oil exporter and the second largest rubber exporter in the world.
• Indonesia is the 27th most competitive economy in the world.
• The literacy rate in Indonesia is very high at ~96% as of October 2022, with the youth literacy rate at 99.8%.

FAQs

• Do I have to be present in Vietnam to incorporate my business?

  No, Viettonkin Consulting will help you with the procedures required there.

• Are there any restrictions to foreign ownership in Vietnam?

  Yes, Indonesia’s Negative Investment List (Daftar Negatif Investasi) specifies sectors where foreign ownership is restricted or limited. A 100% foreign company can be established in Indonesia known as a Penanaman Modal Asing, or PMA, but only in allowed sectors.

• What is the minimum captial requirement for setting up a business in Vietnam?

  It depends on the business entity. For PMA, the minimum investment is IDR 10 billion (~USD 617,000), with at least IDR 2.5 billion (~USD 154,000) in paid-up capital.

• What is the shortest amount of time I need to establish a business in Vietnam?

  It depends on the entity as well as the duration for obtaining the relevant certificates and permits. However, it would usually take 1-3 months.

• Can I hire foreign employees to work for my company?

  Yes, but they must possess the appropriate employment visas.