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Tax Glossary
Tax Treaty (P3B / Double Tax Agreement)
A Tax Treaty (P3B) is a bilateral agreement between two countries to avoid double taxation and prevent fiscal evasion on income sourced in either country. Governed by Article 32A of the Income Tax Law. Indonesia has tax treaties with over 70 countries. Treaties cover: taxation rights over business income, dividends, interest, royalties, and capital gains; PE definitions; and Mutual Agreement Procedure (MAP) for dispute resolution. Foreign taxpayers must present a Certificate of Residence (SKD) to claim treaty benefits.
Tax Guides
Tax Guide for Expatriates and Foreign Nationals in Indonesia
Foreign nationals who are Indonesian tax residents (stay more than 183 days in a 12-month period) are subject to Indonesian income tax on worldwide income. Non-residents are taxed only on Indonesian-source income at a flat 20% withholding rate.
Tax Guides
Tax Guide for Stock and Mutual Fund Investors in Indonesia
Capital gains from Indonesian stock exchange (IDX) transactions are subject to a 0.1% final income tax on gross proceeds. Dividends from Indonesian companies are tax-exempt if reinvested under PMK 18/2021.