What could possibly go wrong?
Image by Cleyton Ewerton on Unsplash.
We’ve used this headline a few times before in some of our blogs around ownership and management of villas and properties in Bali and Indonesia.
This time it’s about visas. So if you’re thinking about coming to Indonesia and possibly living and investing in Bali, you might want to spend 5-minutes reading this.
Since Indonesia closed its borders back in March 2020, more than a few expats got “stranded” in Bali, either by choice or because they where too late to get out.
Indonesian immigration and the government have done a tremendous job all this time, starting off by granting everyone an emergency status on their visas. Most other countries didn’t do this.
As the pandemic continued, and since August, Indonesia has allowed all expats to continue to extend their stay, and/ or change their visa to business/ social and stay permits without having to leave the country. There was some confusion and also some complaints when this first happened, but overall allowing this to take place, was again a remarkable policy.
Since August, Indonesia has also started to allow expats to come to the country for various reasons such as essential business, family reunions, investments, because they’re retirees and for business visits.
This has made it possible for people to start coming back to Bali (and Indonesia) for long-term visits. It means they can stay in great villas and have the time to consider if they would invest and eventually move to Bali.
Today we also got news that visits by yachts and people wanting to go on yachts in Indonesia is now also allowed.
All this is great news and gives Bali’s tourism industry some much-needed hope. However, we have also seen a lot of less responsive “agents” and agencies taking advantage of this situation.
Whether you’re in Indonesia already and you want to change or extend your visa or if you wish to enter Indonesia, we strongly suggest you do some homework as to the various visa options available and also research the agents and agencies out there offering services.
For example, an agent should have an office or a clear address, especially if they offer to be your sponsor. If you’re looking for a social visa however, then your sponsor is a ‘private individual’ and not a business.
In either case, there are times when you will need your sponsor like for extensions or if there are issues with immigration or other government institutions, so it pays to know where you can easily find them when you need them.
So what can you do (and not do), and how should the various visas be structured?
A Retiree KITAS is what it says it is. It’s for retirees, which in Indonesia is when you’re 55-years old or above, or at the very least you don’t have any commercial activities in Indonesia.
You need a sponsor that provides you with the documents you need and deals with possible extensions.
If you’re here or coming in on a Business Visa this is what you can do according to immigration’s own information. The visa type is called a 211 a / b.
The 211 a / b visa is for tourism, family, socio-cultural, government duties and business activities. The list includes:
Arts and culture
Sports that are not commercial in nature
Comparative studies, short courses and short training
Having business talks
Make purchases of goods
Give lectures or attend seminars
Participating in international exhibitions
Attending meetings held with representative head offices in Indonesia
Continuing to travel to another country
Join the means of transportation in the territory of Indonesia
To carry out emergency and urgent work
Industrial visiting activities include, among others, providing guidance, counseling and training in the application and innovation of industrial technology to improve the quality and design of industrial products as well as conducting audits, quality control of production or inspection of company branches in Indonesia. Prospective foreign workers in the work capability trial.
Under no circumstances can you do commercial and paid work in Indonesia with this visa.
On this visa, which is valid for 12-months, you will have a specific job in a specific company. You must comply with income tax regulation and also sign up for Indonesia’s insurance and pension fund structure.
This has become very popular and in real terms means your setting up a company (PT PMA) under Indonesian law and privately investing IDR 1 billion or more.
With this visa the Indonesian government grants you a 2-year stay permit.
Note that the Investment KITAS itself does not allow you to work, unless you’re a Director in the company you set up. This is a very viable way for a few friends to come together and set up a business in Bali and Indonesia.
However, there are now plenty of irresponsible agents and agencies offering the Investment KITAS and they typically set up a company with sometimes as many as 20-30 foreigners all with, on paper at least, paid up capital of IDR 1 billion each!
What could possibly go wrong?
Well, quite a lot can go wrong actually!
First of all if you’re a Director you have to remember you’re 100% liable for any and all activities of the company. But if the agent is irresponsible the chances are you most probably don’t even know the company address or what the company is registered to do.
You probably also don’t know the company’s investments (if any) its taxes and its compliance with Indonesian law.
Ask yourself, if someone else in this company got caught for working illegally or doing something criminal, who do you think the police and immigration will investigate?
The answer is you!
You have to remember you also can’t do any work other than for this specific company.
If you’re a Commissioner you have less liability but you’re still not totally free. If you’re not reporting your own and the company’s taxes, what will happen?
All these companies, and your name, is registered under the OSS (Online Single Submission system) and if there is no compliance the system shuts your name down making it very difficult to renew and/ or set up a legitimate company later unless it’s all taken care of, including the taxes.
I’ve spoken to many expats and possible investors out there and they’re telling me (and showing me) some crazy communication with agents, or so-called agents.
When they’re asked about work, for example, and what they’re allowed (or not) to do, they’re told they can work a little, or work online and so on.
When they ask the agent as to where they have their address and office or often even if they have an email they answer that they work freelance. One even said he was working under cover!
Ask yourself the question, what would happen if there were ever an issue, would they be there for you? Something tells me I doubt it somehow.
So, please take your time to seek advice and read up on the various options.
Try and find information about your agent and agency.
Do they have an office or a company. If they don’t just don’t engage.
I know agents that change names every 3-4 months. They change their areas of practice. They even change their company name and its logo.
The bottom line is you need to be very careful as the impact of your actions can be substantial and ignorance is no argument under Indonesian law.
If you’d like to talk to us about visas and the best ways you can invest and live in Bali, please come in for a coffee and a chat on Jalan Sunset Road 777 or email us on email@example.com