Pondok Wisata License (Homestay Permit): Required under Permenparekraf No. 9/2021. Mandatory for properties offering daily/weekly accommodation. Apply through OSS (Online Single Submission) system with NIB (Business ID Number).
TDUP (Tourism Business Registration): Regulated by PP No. 24/2022. All tourism accommodations must register. Valid for 5 years, renewable. Requires: Building permit (IMB/PBG), land certificate, environmental compliance (UKL-UPL for properties >1000m²).
Zoning Compliance: Per Perda Badung/Gianyar RTRW, short-term rentals prohibited in pure residential zones (Zona Perumahan). Allowed in mixed-use (Zona Campuran) and tourism zones (Zona Pariwisata) only.
Safety Standards: Must comply with Permen PUPR No. 14/2017 - fire safety, emergency exits, pool safety barriers, electrical certification (SLO from PLN).
PPh Final (Income Tax): Per PP No. 34/2017, rental income taxed at 10% of gross revenue. Withholding by tenant if corporate; self-assessed if individual tenant. Monthly payment via e-Billing (SSE3).
PBJT (Regional Service Tax): Per UU No. 1/2022 Art. 50-54, accommodation services subject to 10% tax on service value. Collected from guests, remitted monthly to Bapenda (Regional Revenue Office). Replaces former PB1 (Hotel Tax).
PPN (VAT): Per UU No. 7/2021, 11% VAT applies if annual gross revenue exceeds IDR 4.8 billion. Must register as PKP (Taxable Entrepreneur). Issue tax invoices via e-Faktur system.
PBB (Property Tax): Annual land and building tax per UU No. 12/1994. Rate: 0.1-0.3% of NJOP (assessed value). Due by August 31 annually.
Annual Filing: SPT Tahunan due March 31 (individuals) or April 30 (entities). Non-compliance penalties: 2% monthly interest + administrative fines (Art. 9 UU KUP).
Hak Milik (Freehold): Per UUPA Art. 21, restricted to Indonesian citizens only. Foreigners absolutely prohibited. Any nominee arrangement violates Art. 26(2) UUPA - transaction is VOID ab initio.
Hak Pakai (Right to Use): Per PP No. 18/2021, foreigners with valid KITAS/KITAP can obtain Hak Pakai. Initial term: 30 years, extendable 20+20 years (max 70 years). Property minimum value: IDR 5 billion (Bali). Must be used as residence, not for rental business.
Hak Sewa (Leasehold): Per Civil Code Art. 1548-1600, lease agreement between parties. No maximum term legally, commonly 25-30 years. Notarized agreement recommended. Lessee has usage rights only, no ownership transfer.
PT PMA (Foreign Company): Per UU No. 25/2007 (Investment Law) & PP No. 5/2021. Can hold HGB (Building Rights) - 30+20+20 years. Minimum investment: IDR 10 billion. Requires BKPM approval. Accommodation business (KBLI 55) open to 100% foreign ownership.
Nominee Risk: Per Art. 26(2) UUPA and Criminal Code Art. 385, nominee arrangements constitute fraud. Land reverts to state. Both parties face criminal prosecution. Bank Indonesia Regulation PBI 20/2018 - suspicious transaction reporting.
4. Recommended Business Structures
Option A - Leasehold + Indonesian CV: Lease property via Hak Sewa. Establish CV (limited partnership) with Indonesian partner. Indonesian manages operations, foreigner provides capital. Profit sharing via notarial deed.
Option B - PT PMA (100% Foreign): Full foreign ownership permitted for accommodation (KBLI 55101-55900). Higher setup cost (IDR 10B+ investment). Full control and legal protection. Direct HGB land title possible.
Option C - Management Agreement: Indonesian-owned property. Foreign investor provides capital via loan agreement. Returns via management fee or profit-sharing. Lower risk but limited control.
Due Diligence Required: Verify land certificate (SHM/SHGB) at BPN. Check zoning at Dinas Tata Ruang. Confirm no disputes via village head (Perbekel). Environmental clearance for commercial use.
5. Recent Regulatory Updates (2023-2024)
Pergub Bali No. 25/2023: Stricter enforcement on unlicensed vacation rentals. Mandatory registration in CHSE (Health/Safety/Environment) program. Digital platform reporting requirements.
UU Cipta Kerja (Job Creation Law): Simplified OSS licensing via PP No. 5/2021. Risk-based permit classification. Accommodation classified as medium-risk requiring standard certification.
Tourist Levy (2024): Per Perda Bali No. 6/2023, IDR 150,000 levy per foreign tourist. Accommodation providers may be required to collect and verify payment proof.
Disclaimer: This information is compiled from Indonesian laws and regulations for educational purposes only and does not constitute legal, tax, or investment advice. Laws and regulations are subject to change and interpretation may vary. Always consult with licensed Indonesian legal counsel (Advokat), certified tax consultant (Konsultan Pajak Bersertifikat), and registered notary (PPAT) before making any investment decisions. Last updated: January 2024.
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Short-term Rental Mode
You are simulating short-term vacation rentals. This business model in Bali requires proper licensing (Pondok Wisata) and compliance with local regulations.
View legal requirements or consult with a local expert before investing.