Understanding the taxes you must pay when running accommodation services in Bali
We all know that the accommodation service business is a highly attractive investment for foreigners in Bali. However, running this type of business sector under a PT PMA (Foreign-Owned Company) comes with specific tax obligations.
Keep reading; we’ll break it down for you!
As a foreign-owned company operating an accommodation service in Bali, your business and services are subject to several taxes. These include:
A newly established PT PMA (foreign-owned company) can enjoy a 0.5% tax rate in the first three tax years. However, after three years, the standard rate will be 22% on net profit.
Pajak Bumi dan Bangunan (PBB) is a property tax imposed on land and buildings in Indonesia. It applies to both individuals and companies, including PT PMA companies that own property, such as accommodation rental businesses.
In Bali, the PBB rate is tiered based on the NJOP (Nilai Jual Objek Pajak) or Taxable Property Value:
⚠️ The PMA company (villa owner) is responsible for paying PBB annually to the local government.
PB1 applies when offering accommodation and food services, and is charged on your guest’s bill.
To pay your taxes as a PT PMA, you must first ensure your company is registered with the Directorate General of Taxes (DJP) and has both a Tax ID (NPWP) and an Electronic Filing Number (EFIN). All tax payments, whether monthly or annually, are done through the CORETAX platform.
As a business owner, especially a foreign-owned business entity, avoiding these tax obligations can result in legal consequences, including:
Managing an accommodation service business as a PMA in Bali means you have to understand and follow the country’s tax rules. By staying informed and collaborating with a tax expert, you can operate your business smoothly and avoid unexpected expenses.
