Your Bali Property Blogspot

We recognise that understanding the Indonesian tax systems is challenging for you – including the aspects related to properties. However, it’s vital to have a good understanding of property law. Let’s discuss property taxes in Indonesia and you’ll know that it's easier than you think!   Understanding Property Taxes in Indonesia Understanding property taxes in Indonesia is mandatory for everyone who are involved – including property owners, sellers, and buyers.   This property law isn’t applicable to Indonesians only, but also to foreigners. However, the regulations and tax rates are different between Indonesians and foreigners.   For instance, if you have a leasehold title for a property in Indonesia, you must pay the tax annually. These Indonesian tax systems can be complex. So, you need to be well-informed in order to prevent any potential punishments or penalties.   There are types of taxes applied in Indonesia that you should know. What are they?   Land and Building Tax (PBB) Land and building tax is an annual-basis property tax paid by everyone who owns property in Indonesia. This tax is named Pajak Bumi dan Bangunan (PBB) in Indonesian.   Land and building tax is the most fundamental tax among property taxes in Indonesia and is collected by the local government.    If you have a leasehold title for property in Indonesia, you’ll be charged by the landlord for this tax.   There are three factors that influence the land and building tax – PBB rate, NJOP, and NJKP.    What are the meanings of those terms? Let’s dive!   1. PBB Rate  This is a rate that refers to Undang-undang Hubungan Keuangan antara Pemerintah Pusat dan Daerah (UU HKPD). The maximum PBB rate is 0.5%.   Take note that 0.5% is a maximum rate. It means the PBB rate can different depending on the area. Every local government sets the PBB rate based on the local regulation that applies.   2. NJOP (Nilai Jual Objek Pajak) An average market value obtained from the previous real estate transaction. NJOP is set by the local government if there’s no real estate transaction recently.   NJOP value is influenced by several factors – location, population density, transportation facilities, and type of property. It means NJOP values are different depending on the area where your property is located.   The good news is, you can check the NJOP value in your property’s area – online and easily. For example, you can check for Bali area on the BAPENDA Bali Official Website or for Badung Regency area on the BAPENDA Badung Official Website.   3. NJKP (Nilai Jual Kena Pajak) NJKP is a value based on NJOP. The formula is:   If you’ve found the NJOP and then the NJKP value, now you can calculate the PBB. The formula is:   For easier understanding, let’s say you have a property with the NJOP value of Rp3,000,000,000 (3 billions rupiah) in Badung Regency. How much you must pay PBB tax annually?   The following are NJOP rates that apply in Badung Regency:●    NJOP rate if the property value is 1 billion rupiah or below in Badung Regency = 0.1%●    NJOP rate if the property value is more than 1 billion rupiah in Badung Regency = 0.2%   So, you must pay Rp2,390,400 annually for the PBB tax.   Please take note that PBB is an official assessment. It means the local government has the authority to assess your PBB tax tariff. You need to pay the tax annually. Land and Building Transfer Taxes Property buyers and sellers must pay specific property taxes in Indonesia. There are Sales Tax (PPh), Transfer Tax (BPHTB), and Value Added Tax (VAT).   1. Sales Tax (PPh) – paid by the seller Sales Tax or Pajak Penghasilan (PPh) is a tax that is paid by a seller when selling a freehold property. How to calculate the PPh?   The rate of PPh is 2.5% of the property value that is written in the Sales Deed or Akta Jual Beli.   2. Transfer Tax (BPHTB) - paid by the buyer Someone who buys property or land in Indonesia must pay a tax called Transfer Tax or Bea Pengalihan Hak atas Tanah dan Bangunan (BPHTB) in Indonesian.   The rate of BPHTB is 5% of Nilai Perolehan Objek Pajak (NPOP) reduced by Nilai Perolehan Objek Pajak Tidak Kena Pajak (NPOPTKP).    Based on that explanation, the formula of BPHTB is:   3. Value Added Tax (VAT) - paid by the buyer Value Added Tax is a tax paid when you buy or lease a property from a professional developer. This tax is also called Pajak Pertambahan Nilai (PPN). The rate of VAT is 11% of the property value.     Other Property Taxes in Indonesia Besides PBB or Land and Building Transfer Taxes, there are other kinds of Indonesian tax systems we can explore.    Especially, if you have a leasehold title and run a rental property business in Indonesia. This part is quite interesting and important for you.   1. Rental Income Tax Rental income tax is calculated from the gross income you earned from your rental business. This tax is also called Lease Tax.   So, how much do you pay for rental income tax?   Well, it depends on your residency in Indonesia. You just need to pay 10% of your rental income If you're subject to the resident tax of Indonesia. But, you must pay double (20%) if you’re a non-resident of Indonesia.   This means, knowing your rental income tax is crucial for considering your rental rates.   2. Construction Tax When individuals decide to develop a building on their land, they’re also obligated to pay a tax known as Construction Tax.    Construction tax tariff is influenced by two factors – tax rates and construction’s budget. The tax rates vary on the business qualification of the constructor.  In order to make you understand about construction tax easier, here are the tax rates based on PP Nomor 9 Tahun 2022 (Government Regulation) approved by the President of Indonesia: Here is the formula of construction tax:   3. Luxury Tax Luxury Tax, or known as Pajak Penjualan atas Barang Mewah (PPnBM), is a tax which applies to a property with at least 30 billions rupiah. This tax rate is 20% of the property value.   Key Takeaways Obeying the property law and taxes is crucial for you who has property in Indonesia. By knowing how property taxes in Indonesia work, it will help you to prevent unpleasant consequences.   Understanding property taxes in Indonesia isn’t as hard as it looks. More than preventing you from penalty, you also can set the best tax optimization strategy easier for your property business in Indonesia.

Buying a leasehold in Bali is a promising investment. But, foreigners don’t really understand the rules. Having a leasehold title is simple – as long as you know the rules. If you’re a foreigner who’s looking for a property leasehold opportunity in Bali, you’re in the right place.   Here, you’ll get a brief pocket guide to start your property investment journey in Bali.   Intro: Leasing Properties in Bali Before we start discussing leasehold in Bali, we need to know, what is leasehold?   Leasehold is a kind of contract that allows you, as a foreigner, to use and live in the property.   Not only for living, leasing properties is a good option for you who wants to invest in Bali, whether it’s villa or land. Why?   Here are the reasons: - It’s more affordable to lease property or land than to purchase the freehold titles.   - Depending on the rental licences or zoning of the land or villa, some commercial leasehold titles allow you to rent it out or even run the property as a holiday rentals business.   - The process of leasing villas or land is fairly straightforward. You don’t need certificates like Hak Guna Bangunan (HGB), Hak Pakai (HP), and PT. Penanaman Modal Asing (PT. PMA) setups in order to complete the process of leasing a part of paradise.   - When you settle on the perfect villa or land, the sellers are liable to pay leasehold taxes and the buyers pay the notary 1% fee.   Understanding Leasehold Title in Bali Understanding the rules about leasehold in Bali is critical. Especially, if you want to start your investment journey and earn money through leasing a villa or land in Bali. You’ll find that property leasehold investment is much easier if you know the rules that are applied.   One thing you have to note – every country has different rules and regulations regarding property leasehold laws, including in Bali.   Leasehold is a contract term used to describe an asset that is being leased – usually, properties like villas or lands, commercial spaces and some hotels are on leasehold titles as well.   This title allows you to own a property for a certain period of time, usually for 30 up to 80 years – it’s a long-term contract.   There are two parties involved in this agreement – you, as the user of the property (lessee) and the rightful owner of the property (Landlord/lessor).   You (lessee) agree to a contract with the rightful owner (lessor) for the right to use the property. This agreement also includes the payment and the period of the lease. The lessor still has the full ownership of the property.   Due to this being a long leasehold you will never hold the actual title of the property, and this is only for the number of years stipulated on your master lease agreement.   Most leasehold contracts have “option to extend the land lease period” written into the agreement at market related prices at the time of extension.    When the contract expires or you do not exercise your right to extend the lease, the property rights will be reverted to the rightful owner.   Price Expectations on Leasehold in Bali Price expectations on leasehold in Bali varies depending on many factors such as location, size, facilities, and lease duration.   For instance, if you want to lease a villa in Bali, the price expectations of villa leasehold in Bali ranged from USD 100.000 to USD 4.000.000 for periods up to 30 years.   Make sure to know and consider all the factors of the villa (location, size, facilities, price, and lease duration) before making a single agreement with the landlord or seller.   Despite the various prices, leasing properties in Bali for investment still promises you to yield a profitable ROI. You can run a short-term rental business through a property you lease – like a villa. As long as you and the landlord have an agreement for using the villa for vacation rental business and/or you get the leasehold title through PT. PMA, you're able to run the business legally.   Please note that all legally run villas need to have the correct rental licences in place, as well as a legally registered business should you wish to rent the villa out yourself.   Another easy way is to involve a management company to take care of the rental side of the property.   This industry is growing in some sought-after areas in Bali. For instance, in Uluwatu, Seminyak, Sanur, Canggu, and Pererenan.   Top 5 Tips for Leasehold Purchase in Bali Everyone loves convenience, including when doing a leasehold purchase in Bali. Here are top five tips that make your leasehold deal easier. Let’s start!   1. Learn About Leasehold Title The first thing you need to do is learn and understand the property market. Specifically, on leasehold in Bali.   You have to know what a leasehold title is, the rules applied in Indonesia, and the price range. Do more research and pay more attention to areas like Uluwatu, Seminyak, Sanur, Canggu, and Pererenan.   Luckily, you've learned about that in this article!   2. Define Your Budget After you familiarise yourself with the property market in Bali, you can finalise your budget.   3. Collaborate with a Trustworthy Real Estate Agency Collaborating with a trustworthy and fully integrated property agency in Bali is highly recommended for you. Why?   A trustworthy property agency will help you to choose the best properties suited to your needs and budget requirements. They will help you negotiate and plan ahead.    More than that, a property agency can help you to do research on leasehold property prices in Bali, help you with contract management, and give you advice whenever you need it.   4. Negotiation Contract is a critical part of your leasehold negotiation. Make sure that the contract is clear, unambiguous, and has a win-win solution between you and the lessor.   5. Make the Deal Once both you and the lessor feel satisfied with the terms in the leasehold contract, you can go ahead with the deal.    A legal due diligence will be done by your chosen notary to ensure all the legal paperwork is in place, that the property or land has access. Once this is cleared you can settle the final amounts and receive the keys to your new home.   Get Your Dream Villa! Bali not only promises you beautiful landscape and culture, but also an investment opportunity. Having a short-term rental business in Bali is a good choice, remembering Bali is one of the most popular destinations for holiday makers.   If you are only starting out, and want to know about property leasehold in Bali, we will assist best we can.   Contact us today to start your journey towards leasing your dream villa.

Exclusively Listed with BVR Group Asia - a beautiful luxury villa complex in Berawa, Canggu. Sprawling across a massive 3275m2 of leasehold land and a built-up area of 1261m2. This luxury villa complex in Berawa is a perfect investment opportunity. A golden chance for you, who are looking for a business opportunity. The location offers you the opportunity for future redevelopments. ROI projections are available for this villa complex. A once-in-a-lifetime opportunity to own a truly unique resort-style complex in the highly sought-after tourist hot spot.   What does this villa complex offer to you? This luxury villa complex in Berawa, Canggu offers 6 spacious private pool villas, a large studio apartment, a professional front office, and a reception area. Located in the heart of Berawa, this complex is just 300 meters to the beach as well as surrounded by attractions such as Café Delmar, Finns Beach Club, international supermarkets, renowned cafes, restaurants, spas, and a variety of night life. The beautiful villa complex in Berawa offers elegant interiors all fitted with white marble and natural finishes. Expansive open-air areas invite you to enjoy ample natural light and refreshing ventilation in every villa - the best way to relax your mind. Rental licenses: Hotel Melati with full PBG Building Permit. Want to secure one of these beautiful villas as your investment or home in Bali? Secure your chance to have this villa. Click here!

A warm welcome from 1200 to 1300 metres above sea level in Plaga-Bali. There, Bali Coffee Club with its passionate coffee farmers produces only high-quality Arabica coffee beans for your everyday coffee. Across a vast 4-hectare, we consistently deliver an exceptional coffee experience through coffee plantation in Bali. Notably, orange, vanilla, and avocado trees are planted alongside the coffee to protect its ecosystem. It's important to note that the presence of these orange, vanilla, and avocado plants contribute significantly to the tangerine taste, which is unique to Bali Coffee Plantation. Through a long journey that takes four years until our coffee harvest, our dedicated coffee farmers carefully process it using a dry method. Although there are many methods for producing coffee beans, we always choose the best method to produce high-quality coffee beans, which are honey-processed. Honey-processed is considered as a true specialty coffee even before being expertly roasted. The unroasted beans have natural sweet and fruity flavours, and the level of acidity varies based on the honey processing method used. Not to be forgotten, when the post-harvest process from our coffee plantation in Bali is ready for the next step, it is crucial to pay attention to the coffee roasting process. That's why we use the latest technology to ensure that our coffee beans have a great taste. We employ air roasting coffee machines that are imported directly from Norway with smart technology. These machines use an air convection heat system in which the heat from the machine does not directly come into contact with the coffee beans, preventing them from becoming bitter or burnt. Moving to the final step, where our roasted coffee beans are ready to be prepared by our baristas, we always ensure your happiness through a variety of coffee menus. Just remember, this entire journey can happen thanks to our passionate coffee farmers, talented coffee roasters, and friendly baristas. They are always thinking of you to ensure your day is filled with happiness in every little moment.