Bali Property Taxes: PPh, PBB, BPHTB, and Meterai

Indonesia’s tax system for property owners works differently than in Russia or Europe. Let’s look at the four main taxes and duties you will encounter. 1. PPh (Pajak Penghasilan) — income tax If you sell property in Bali, the seller pays PPh at 2.5% of the transaction value. It is withheld through the notary during closing. If you rent out property, the tax on rental income is 10% (for non-residents) or a progressive scale of 5–35% (for residents with NPWP). This tax can be paid on behalf of a PMA — in that case, the 22% corporate tax rate applies. 2. BPHTB (Bea Perolehan Hak atas Tanah dan Bangunan) — tax on acquiring rights to land and buildings The buyer pays it when the transaction is completed. The rate is 5% of the property value minus the non-taxable threshold (NJOPTKP), which varies by regency; in Bali it averages around 60 million rupiah. The tax is withheld through the notary. 3. PBB (Pajak Bumi dan Bangunan) — annual land and building tax Paid every year by the owner. The rate is 0.1–0.3% of NJOP (the government assessed value). NJOP is usually 3–5 times lower than the market price, so the actual payments are small. For a villa worth $200 000, PBB usually falls within $100–300 per year. 4. Meterai — stamp duty This is a small stamp on documents, regulated by Decree 134/PMK.03/2021 and Law No. 10 of 2020. It costs 10 000 rupiah per stamp (about $0.6). It is required for all agreements worth more than 5 million rupiah, including lease agreements, sale and purchase agreements, and powers of attorney. Since 2021, electronic Meterai has been legalized. A common beginner investor mistake is thinking that PBB is the whole tax burden. In reality, the annual cost should also include license fees (if the property is rented out), management company fees, insurance, and periodic legal services for license renewals. What to do at the start: — Get an NPWP (tax number). This gives you the right to deductions and a standard tax rate. — Open a separate bank account for rental operations so you do not mix income with expenses. — Find a local outsourced accountant. In Bali, this costs 1.5–3 million rupiah per month and removes 90% of the tax routine. If you operate through a PMA, the tax structure is different — on top of personal PPh, the company’s 22% corporate tax and mandatory annual reporting are added.