PMA Company.

A PMA (Penanaman Modal Asing) or PT PMA (Perseroan Terbatas Penanaman Modal Asing) is known as a Foreign Owned Company in Indonesia. This is a type of legal entity in which foreigners can choose to conduct commercial activities in Indonesia established under the Indonesia Law.
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Requirements to open PMA company
Requirements to open PMA company
Today it is easy to open your own company in Indonesia as never before
Paid up capital upon establishment
The minimum paid-up capital for a foreign-owned company in Indonesia is Rp. 2,5 billion / USD 175.000. Shareholders will have to sign a capital statement letter. This is a letter saying that the shareholders have sufficient funds for the capital.
Minimum total capital
The investor should invest above 10 Billion IDR / USD 750.000 as their investment plan in the first 1 years after establishing company. The Investment plan can either be cash or fixed assets, such as machinery.
Ownership
Depending on the business classification, foreigners may hold 100% ownership of a business. However, some business lines do not allow foreign ownership at all. The Negative Investment List (DNI) lists restricted industries. This is usually revised every few years.
Registered business location
Indonesia is a decentralized country. A lot of the government’s work takes place at the district level. Because the local district is in charge of local permit approvals, it is important to choose your business location before starting the registration process. We can help you obtain registered business address with virtual office.
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Structure of PMA
Structure of PMA
Shareholders
Min 2 Shareholders
Can be Individuals / Companies / Foundations
Min share 1 billion IDR per shareholder
Board of Directors
Min 1 person
Can be one of the shareholder
At least one director should be a resident of Indonesia and must have KITAS and tax card (NPWP)
Board of Commissioners
Min 1 person
Can be shareholder
Without working permission
Can be non-resident

Steps of setting up PMA
Steps to setup PMA
1
Register the company name to the notaris. Name must contain 3 words
2
The Notary will make a draft Deed of Establishment
3
Dacree Approval will be issued by the ministry of Law and Human Rights
4
Obtain a Tax ID
5
Obtain a registration number (NIB/Nomor Induk Berusaha)
6
Obtain the business license through Online Single Submission System (OSS)
7
Obtain the commercial license (if applicable)
8
Obtain Domicile Letter
1
Register the company name to the notaris. Name must contain 3 words
2
The Notary will make a draft Deed of Establishment
3
Dacree Approval will be issued by the ministry of Law and Human Rights
4
Obtain a Tax ID
5
Obtain a registration number (NIB/Nomor Induk Berusaha)
6
Obtain the business license through Online Single Submission System (OSS)
7
Obtain the commercial license (if applicable)
8
Obtain Domicile Letter
FAQs
What does the PMA stand for and are there any limitations to my business name?
PT PMA is basically the Indonesian equivalent to Limited, Pte or Ltd. In Indonesia you must register your PMA company name in Indonesian or English using a minimum of 3 words. For example: Klub Rumah Baru or New home club. But, don’t worry this is just your company establishment name, you may brand your business with a name you prefer.
When setting up a business do you need an actual office or can you use a residential location?
Before processing of incorporation, you need to choose the location of your business and have a registered address in an office building Indonesia. You cannot use your home address as it is not possible to register a company with a residential address. Alternatively, you can also use a virtual office for Local PT or Coworking Space for PT PMA.
What is paid up capital and how does that effect the business set up?
Paid up capital is the amount of money the shareholder invests into the business.
The investor should invest above USD 1 million / 10 Billion IDR as their investment plan, with a paid-up capital above USD 250.000.000 / 2.5 Billion IDR. The Investment plan can either be cash or fixed assets, such as machinery.

There are 2 ways to prove the paid up capital; one being to send a copy of your company bank statement which shows the investment amount, the second option is to sign a statement letter acknowledging that you will invest the capital in the future.
Do you need to provide proof of transfer of your paid up capital?
Whilst processing our company establishment, you do not need to provide proof of transfer for your paid up capital. You may pay the paid up capital once the company is established.

Paid up capital is generally set at 25 percent of the minimum capital requirement (hence IDR 2.5 billion). In certain (capital intensive) industries paid up capital requirements are higher. In practice, however, it frequently occurs that a PT PMA is established without the foreign investor needing to transfer the paid up capital to an Indonesian bank account. The shareholders of the PT PMA can sign a Capital Statement Letter pledging that the paid up capital can be transferred (without ever transferring it). However, in specific sectors, such as the financial services sector, this is not possible.
Are there any standard compliances you need to know before establishing your company in Indonesia?
Apart from taxes, companies must also register for social and health security programme (BPJS) by the government. For PT PMA companies it is mandatory to report investment four times per year which is commonly known as the “LKPM Report”.
How does the taxation process work in Indonesia?
All companies in Indonesia must pay and report taxes on a monthly and annual basis. The main corporate taxes imposed on companies in Indonesia are: corporate income tax (CIT), value-added tax (VAT), and land and building tax. The general corporate income tax rate imposed in Indonesia is 25%. Medium-sized companies with annual revenue of less than IDR 50 billion can apply for a reduced income tax rate of 12.5%, and small companies with annual revenue of less than IDR 4.8 billion are eligible for corporate income tax of 0.5%.
Can the Director or Commissioner be a foreigner in a PT or a PMA?
Directors and Commissioners of a PT PMA can be foreigners or Indonesians and they are not required to be residents in Indonesia. Please note that non resident Directors will not have the authority to sign documents on behalf of the company.

In regard to a Local PT you may have a foreign Director, but you should still have a minimum of 1 local Director as well as a local commissioner.
How many foreigners can you hire once the company has been established?
A PT PMA may hire as many foreigners as required, as long as you have a minimum of 10 Indonesian Employees per 1 foreigner.

For a Local PT you can hire 1 foreigner as long as you have a minimum paid up capital of 1.1 billion IDR.
What are the responsibilities of the Director and the Commissioner?
The Directors responsibilities are to manage the company pursuant to its Articles of Association and the Indonesian Company Law.
The Commissioners responsibilities will be to supervise the company’s activities.
Once the company is established, do you need to renew any licenses every year?
There are no validity restrictions or renewals that are mandatory every year, as long as the company is still running and there are no amendments required from either the business structure or new governmental regulations.
If we would like to change the office address later is this possible?
If you would like to change your office location, the first thing you need to know is whether your new address is still in the same district as the previous one. If this is the case, then all you will be required to do is report your new company address to the tax office so they can change your taxation number.

Unfortunately, if your new address is in a different district you will need to amend numerous documents and permits such as: the location permit which will need to be signed by the district and subdistrict heads, as well as revise your Article of Association, Domicile Letter, Business License, Company Certificate Number and finally – advise the tax office so they that change your taxation account."
FAQs
What does the PMA stand for and are there any limitations to my business name?
PT PMA is basically the Indonesian equivalent to Limited, Pte or Ltd. In Indonesia you must register your PMA company name in Indonesian or English using a minimum of 3 words. For example: Klub Rumah Baru or New home club. But, don’t worry this is just your company establishment name, you may brand your business with a name you prefer.
When setting up a business do you need an actual office or can you use a residential location?
Before processing of incorporation, you need to choose the location of your business and have a registered address in an office building Indonesia. You cannot use your home address as it is not possible to register a company with a residential address. Alternatively, you can also use a virtual office for Local PT or Coworking Space for PT PMA.
What is paid up capital and how does that effect the business set up?
Paid up capital is the amount of money the shareholder invests into the business.
The investor should invest above USD 1 million / 10 Billion IDR as their investment plan, with a paid-up capital above USD 250.000.000 / 2.5 Billion IDR. The Investment plan can either be cash or fixed assets, such as machinery.

There are 2 ways to prove the paid up capital; one being to send a copy of your company bank statement which shows the investment amount, the second option is to sign a statement letter acknowledging that you will invest the capital in the future.
Do you need to provide proof of transfer of your paid up capital?
Whilst processing our company establishment, you do not need to provide proof of transfer for your paid up capital. You may pay the paid up capital once the company is established.

Paid up capital is generally set at 25 percent of the minimum capital requirement (hence IDR 2.5 billion). In certain (capital intensive) industries paid up capital requirements are higher. In practice, however, it frequently occurs that a PT PMA is established without the foreign investor needing to transfer the paid up capital to an Indonesian bank account. The shareholders of the PT PMA can sign a Capital Statement Letter pledging that the paid up capital can be transferred (without ever transferring it). However, in specific sectors, such as the financial services sector, this is not possible.
Are there any standard compliances you need to know before establishing your company in Indonesia?
Apart from taxes, companies must also register for social and health security programme (BPJS) by the government. For PT PMA companies it is mandatory to report investment four times per year which is commonly known as the “LKPM Report”.
How does the taxation process work in Indonesia?
All companies in Indonesia must pay and report taxes on a monthly and annual basis. The main corporate taxes imposed on companies in Indonesia are: corporate income tax (CIT), value-added tax (VAT), and land and building tax. The general corporate income tax rate imposed in Indonesia is 25%. Medium-sized companies with annual revenue of less than IDR 50 billion can apply for a reduced income tax rate of 12.5%, and small companies with annual revenue of less than IDR 4.8 billion are eligible for corporate income tax of 0.5%.
Can the Director or Commissioner be a foreigner in a PT or a PMA?
Directors and Commissioners of a PT PMA can be foreigners or Indonesians and they are not required to be residents in Indonesia. Please note that non resident Directors will not have the authority to sign documents on behalf of the company.

In regard to a Local PT you may have a foreign Director, but you should still have a minimum of 1 local Director as well as a local commissioner.
How many foreigners can you hire once the company has been established?
A PT PMA may hire as many foreigners as required, as long as you have a minimum of 10 Indonesian Employees per 1 foreigner.

For a Local PT you can hire 1 foreigner as long as you have a minimum paid up capital of 1.1 billion IDR.
What are the responsibilities of the Director and the Commissioner?
The Directors responsibilities are to manage the company pursuant to its Articles of Association and the Indonesian Company Law.
The Commissioners responsibilities will be to supervise the company’s activities.
Once the company is established, do you need to renew any licenses every year?
There are no validity restrictions or renewals that are mandatory every year, as long as the company is still running and there are no amendments required from either the business structure or new governmental regulations.
If we would like to change the office address later is this possible?
If you would like to change your office location, the first thing you need to know is whether your new address is still in the same district as the previous one. If this is the case, then all you will be required to do is report your new company address to the tax office so they can change your taxation number.

Unfortunately, if your new address is in a different district you will need to amend numerous documents and permits such as: the location permit which will need to be signed by the district and subdistrict heads, as well as revise your Article of Association, Domicile Letter, Business License, Company Certificate Number and finally – advise the tax office so they that change your taxation account."
FAQs
What does the PMA stand for and are there any limitations to my business name?
PT PMA is basically the Indonesian equivalent to Limited, Pte or Ltd. In Indonesia you must register your PMA company name in Indonesian or English using a minimum of 3 words. For example: Klub Rumah Baru or New home club. But, don’t worry this is just your company establishment name, you may brand your business with a name you prefer.
When setting up a business do you need an actual office or can you use a residential location?
Before processing of incorporation, you need to choose the location of your business and have a registered address in an office building Indonesia. You cannot use your home address as it is not possible to register a company with a residential address. Alternatively, you can also use a virtual office for Local PT or Coworking Space for PT PMA.
What is paid up capital and how does that effect the business set up?
Paid up capital is the amount of money the shareholder invests into the business.
The investor should invest above USD 1 million / 10 Billion IDR as their investment plan, with a paid-up capital above USD 250.000.000 / 2.5 Billion IDR. The Investment plan can either be cash or fixed assets, such as machinery.

There are 2 ways to prove the paid up capital; one being to send a copy of your company bank statement which shows the investment amount, the second option is to sign a statement letter acknowledging that you will invest the capital in the future.
Do you need to provide proof of transfer of your paid up capital?
Whilst processing our company establishment, you do not need to provide proof of transfer for your paid up capital. You may pay the paid up capital once the company is established.

Paid up capital is generally set at 25 percent of the minimum capital requirement (hence IDR 2.5 billion). In certain (capital intensive) industries paid up capital requirements are higher. In practice, however, it frequently occurs that a PT PMA is established without the foreign investor needing to transfer the paid up capital to an Indonesian bank account. The shareholders of the PT PMA can sign a Capital Statement Letter pledging that the paid up capital can be transferred (without ever transferring it). However, in specific sectors, such as the financial services sector, this is not possible.
Are there any standard compliances you need to know before establishing your company in Indonesia?
Apart from taxes, companies must also register for social and health security programme (BPJS) by the government. For PT PMA companies it is mandatory to report investment four times per year which is commonly known as the “LKPM Report”.
How does the taxation process work in Indonesia?
All companies in Indonesia must pay and report taxes on a monthly and annual basis. The main corporate taxes imposed on companies in Indonesia are: corporate income tax (CIT), value-added tax (VAT), and land and building tax. The general corporate income tax rate imposed in Indonesia is 25%. Medium-sized companies with annual revenue of less than IDR 50 billion can apply for a reduced income tax rate of 12.5%, and small companies with annual revenue of less than IDR 4.8 billion are eligible for corporate income tax of 0.5%.
Can the Director or Commissioner be a foreigner in a PT or a PMA?
Directors and Commissioners of a PT PMA can be foreigners or Indonesians and they are not required to be residents in Indonesia. Please note that non resident Directors will not have the authority to sign documents on behalf of the company.

In regard to a Local PT you may have a foreign Director, but you should still have a minimum of 1 local Director as well as a local commissioner.
How many foreigners can you hire once the company has been established?
A PT PMA may hire as many foreigners as required, as long as you have a minimum of 10 Indonesian Employees per 1 foreigner.

For a Local PT you can hire 1 foreigner as long as you have a minimum paid up capital of 1.1 billion IDR.
What are the responsibilities of the Director and the Commissioner?
The Directors responsibilities are to manage the company pursuant to its Articles of Association and the Indonesian Company Law.
The Commissioners responsibilities will be to supervise the company’s activities.
Once the company is established, do you need to renew any licenses every year?
There are no validity restrictions or renewals that are mandatory every year, as long as the company is still running and there are no amendments required from either the business structure or new governmental regulations.
If we would like to change the office address later is this possible?
If you would like to change your office location, the first thing you need to know is whether your new address is still in the same district as the previous one. If this is the case, then all you will be required to do is report your new company address to the tax office so they can change your taxation number.

Unfortunately, if your new address is in a different district you will need to amend numerous documents and permits such as: the location permit which will need to be signed by the district and subdistrict heads, as well as revise your Article of Association, Domicile Letter, Business License, Company Certificate Number and finally – advise the tax office so they that change your taxation account."
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