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Indonesia - Special considerations for short-term assignments

Special considerations for short-term assignments

Taxation of international executives


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For the purposes of this publication, a short-term assignment is defined as an assignment that lasts for less than 6 months.

Residency rules

Are there special residency considerations for short-term assignments?

When an assignee obtains a work- permit for their employment and a multiple entry temporary stay permit in Indonesia which is valid for more than 183 days, this may be interpreted as an intention to reside in Indonesia. Thus the tax authorities may conclude that this assignee is a tax resident, even if it is merely for a short term assignment. Accordingly, it is suggested that for a short-term assignment, the work permit and stay permit should also correspond to the period of the assignment, such as 4 months or 6 months. 

Payroll considerations

Are there special payroll considerations for short-term assignments?

Non-residents or short-term assignees that stay in Indonesia for less than 183 days are taxed on Indonesia-sourced income only. 

Taxable income

What income will be taxed during short-term assignments?

Non-residents will be taxed on income derived from Indonesia only, at a flat 20 percent tax rate (non-resident tax rate).

Additional considerations

Are there any additional considerations that should be considered before initiating a short-term assignment in Indonesia?

Closely monitor the requirements of the project, only apply for work permit for the time “required” to spend on the project.

Ensure that cumulative number of days present in Indonesia for all “short-term” assignees do not exceed time-test.


All information contained in this publication is summarized by PT KPMG Advisory Indonesia, the Indonesian member firm affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity, based on Indonesian Income Tax Law No 17/2000, Income Tax Law No 36/2008, Regulation of the Directorate General of Taxation PER-43/PJ/2011 and PER-16/PJ/2016, Regulation of the Minister of Finance No 250/PMK.03/2008, 252/PMK.03/2008 and 101/PMK.010/2016, Regulation no. PMK-192/PMK.03/2018.

© 2021 PT KPMG Advisory Indonesia, an Indonesian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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