Indonesia

Employment taxes

• Income tax: Residents are taxed on worldwide income at progressive rates from 5% up to 35%. Non-residents pay a flat 20% on Indonesian income.
• Payroll contributions (employee side): Employees contribute around 2%-3% for social security and healthcare.
• Employers handle payroll deductions, so taxes and contributions are taken care of automatically.

Leave policy

• Vacation leave: Minimum 12 days of paid annual leave after 12 months of continuous work.
• Public holidays: 15 national public holidays
• Sick leave: Employees receive full wages during sick leave certified by a doctor, with certain limits depending on the duration.
• Maternity leave: 3 months fully paid (1.5 months before and 1.5 months after birth), covered by the employer.
• Paternity leave: 2 days of paid leave for fathers, covered by the employer.
• Parental leave: Additional unpaid leave may be available in special cases, depending on company policy.

Employment termination

• Termination rules are strict and protective of employees.
• Employers must have valid reasons (e.g., misconduct, redundancy) and usually need court or government approval.
• Severance pay is mandatory, with amounts depending on the employee’s length of service. From 1 month pay for less than a year of work to 9 months pay for more than 8 years of work.\

Hiring and contracts

• Employment contracts can be permanent (indefinite) or fixed-term.
• Contracts should always be in writing and in Bahasa Indonesia and latin alphabet, and can be bilingual.
• Probation is allowed for up to 3 months (only for permanent contracts).

Payroll and salary payments

• Salaries are usually paid monthly.
• National minimum wage: Set by each province. In Jakarta it’s around IDR 5,067,381 per month (€290 / $315).
• Payment is typically made via bank transfer.

Benefits

• Mandatory: Social security (healthcare, pensions, occupational accident, death benefits).
• Optional (common perks): Meal allowances, transport allowances, housing stipends, bonuses.

Monthly living cost (Jakarta Edition)

• Rent (1-bedroom in city center): €300–€600 / $325–$650
• Utilities & internet: €80–€120 / $85–$130
• Transport: €20–€40 / $22–$45 (public transport is affordable)
• Food: €200–€350 / $220–$380 (mix of street food and dining out)
• Leisure/social life: €150–€250 / $160–$270

How to get a local ID number

• For employees: Once you’re hired, your employer helps you register for a Taxpayer Identification Number (NPWP) and a National Identity Number (NIK).
• For remote workers: You’ll need to register with the local tax office if you plan to stay long-term and pay taxes locally.

Social security registration

• Employers enroll employees in BPJS Ketenagakerjaan (employment social security) and BPJS Kesehatan (healthcare).
• Contributions are shared between employer and employee.

Banking

• Popular banks: Bank Mandiri, BCA, BNI, BRI.
• Opening an account requires a valid passport, residence permit, and local ID number.

Housing and rental process

• Most rentals require 6–12 months’ rent upfront.
• Tenant rights are basic, but contracts typically outline responsibilities clearly.
• Many expats use local agents or online platforms to find housing.

Healthcare system

• Public healthcare exists, but private hospitals are preferred for quality and shorter wait times.
• Expats often use private insurance for wider access.

Driving and public transport

• Public transport in Jakarta includes buses, MRT, and commuter trains.
• Ride-hailing apps like Gojek and Grab are everywhere and affordable.
• To drive, you need an Indonesian driver’s license (SIM), often after converting your international license.

Emergency and important contacts

• Police: 110
• Ambulance & medical emergency: 118 or 119
• Fire department: 113

Work permit and visa requirements

• Employer sponsorship is mandatory. Your company applies for your work permit and visa.
• EU & non-EU citizens: Both follow the same process, an employer must sponsor and arrange your stay permit (KITAS).
• Work permits usually align with the length of your employment contract.

Business culture and work norms

• Hierarchy matters, respect for authority is key.
• Meetings often start with small talk, and building trust is essential.
• Punctuality is valued, but flexibility is common.
• Collective harmony is important, people avoid open confrontation.