Remote work with a spouse KITAS visa - the how

Suramaduman

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Hello, I've been reading the posts related to remote work on a KITAS visa, and the earliest source I found dates from 2020. If the admins find it necessary they can join my post with one of these, but I am here to ask a specific question

I am married to an Indonesian, so I am here with a spouse KITAS. Reading from the other posts, I found it pretty obvious that I can work remotely, although the officials can interpret differently.

My question is about the how: I won't have a legal residence in the country of my new job. I wonder if I should create my own consulting company here in Indonesia, or if it is okay to have a direct contract with the foreign company.

What would be the best way for that, also considering tax?
 
Hello, I've been reading the posts related to remote work on a KITAS visa, and the earliest source I found dates from 2020. If the admins find it necessary they can join my post with one of these, but I am here to ask a specific question

I am married to an Indonesian, so I am here with a spouse KITAS. Reading from the other posts, I found it pretty obvious that I can work remotely, although the officials can interpret differently.

My question is about the how: I won't have a legal residence in the country of my new job. I wonder if I should create my own consulting company here in Indonesia, or if it is okay to have a direct contract with the foreign company.

What would be the best way for that, also considering tax?
You cannot work on a spouse ITAS. This is explicitly stated during the initial application process for a spouse-sponsored visa (E31A, the successor of C317), which is automatically converted into a spouse ITAS upon your arrival in the country.
  1. You are prohibited from selling goods or services.
  2. You are prohibited from working by receiving compensation, wages, or any similar from individuals or companies in Indonesia, unless reported to immigration (using the multiple activity reporting process)
You would only be allowed to work if it has been reported to immigration using the multiple activity reporting process, which essentially mirrors the process of obtaining a work permit (IMTA, RPTKA).

However, you are correct about the practical implementation, local immigration authorities might say you can work, but there are numerous reports indicating that working on a spouse visa is not permitted. To stay on the safe side, it is best to contact both your local immigration office and the Ministry of Manpower and obtain their confirmation in writing. Keep in mind that the local heads of these offices frequently change due to rotational policies, so it is important to verify the information regularly.
 
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  1. You are prohibited from selling goods or services.
  2. You are prohibited from working by receiving compensation, wages, or any similar from individuals or companies in Indonesia, unless reported to immigration (using the multiple activity reporting process)
here says companies and individuals in Indonesia, not from abroad.
 
To stay on the safe side, it’s best to contact both your local immigration office and the Ministry of Manpower and obtain their confirmation in writing. Keep in mind that the local heads of these offices frequently change due to rotational policies, so it's important to verify the information regularly.
This topic has been discussed endlessly on this forum, but I disagree with this advice.
Neither office will give you anything in writing, because this is a legal grey area with contradictory laws. It is therefore not possible to give a definitive legal interpretation.

Sticking to the facts, what we can say is:
1) if you are employed as a foreigner by an Indonesian legal entity, you must have a work permit, and the Indonesian entity should arrange it for you [you can still have a Spouse kitas/p with an Indonesian work permit].
2) if you are in Indonesia but working for an entity abroad under a foreign contract, the Indonesian authorities do not take an interest. [Theoretically they could, but practically they don't]
 
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Hello, I've been reading the posts related to remote work on a KITAS visa, and the earliest source I found dates from 2020. If the admins find it necessary they can join my post with one of these, but I am here to ask a specific question

I am married to an Indonesian, so I am here with a spouse KITAS. Reading from the other posts, I found it pretty obvious that I can work remotely, although the officials can interpret differently.

My question is about the how: I won't have a legal residence in the country of my new job. I wonder if I should create my own consulting company here in Indonesia, or if it is okay to have a direct contract with the foreign company.

What would be the best way for that, also considering tax?
Short answer , yes, you are allowed to work for a company that is offshore, and does not have activity in Indonesia.

Tax income is by regular income tax rate, which is going fast to 30%. Deduction by DTT in theory possible.

Disclaimer, this is not a legal advice etc.
 
Hi everyone, thanks a lot for the answers. We contacted the authorities by whatsapp that said it should be okay.
 
Because , "the right to work" for people in situation like you , stated in Law no.6 Year 2011 , was not implemented by a Regulation , I recommend talking to both the local Immigration & the Manpower Department .

My opinion is that your best option would be : your Indonesian spouse opening a small business and you working informally in it . Since long ago a Manpower officer had said (see below) that informal work is acceptable in such cases , without a work permit .

I guess what Centurion wrote in post 5 above may be acceptable too , but the advantage of working for your Indonesian spouse's small business is that you will pay a lot less income tax (small businesses pay only 0.5% or 1% of the revenue) .

-----------------------

free translation from http://percaindonesia.com/catatan-so...-7-maret-2015/ - discussion between a Manpower officer and Perca)
Note : The above information is not anymore available in Perca's webpage (Perca is an organization of mixed married Indonesians)

[..... A) Holders of KITAS/KITAP sponsored by Indonesian spouse are allowed to work in a company ... with a work permit .
............
D) Case: Husband / wife of a mixed marriage with cuisine chef background want to open a small café, with a small seating area is classified as a small business and does not require work permit. When this business grows crowded and large, than it is necessary to have operating permits from the relevant authorities . When the businesses becomes a legal entity, then this foreign worker must have a work permit
............
CONCLUSION:
Although the Immigration Law no. 6 of 2011, Article 61 states that the holder of an Indonesian spouse sponsored KITAS or KITAP can work and/or do business to make ends meet for him/her and family, we still have to refer back to the Labour Law No. 13 year 2003 and Permenakertrans No. 12 year 2013, which essentially mean that a foreign worker in a mixed marriage is allowed to work without a work permit if in the informal sector, freelance or have a small business which is not a legal entity. When working in a legal entity then MUST have work permit.]
 
here says companies and individuals in Indonesia, not from abroad.
Are we talking about the souse sponsor VISA E31A VITAS or remote workers, (NOMAD visa) e.g E33G VITAS

For remote workers, (NOMAD visa) E33G VITAS there is a requirement. You will need to have
Employment contract with a company established outside the Indonesian Territory.
Also, a bank account that proves income in the form of salary or income worth at least US$60,000 per year;

Once you have shown earning of US$60k+ and have Indonesia residency you are a subject of Indonesia income tax, taking into consideration of Dual Taxation Agreement.
2) if you are in Indonesia but working for an entity abroad under a foreign contract, the Indonesian authorities do not take an interest. [Theoretically they could, but practically they don't]
I believe this is a personal interpretation, I never see anywhere that this information ever stated in official Indonesian Immigration, Manpower. Would like to be proven wrong on this. And Why there is E33G VITAS?

If you could treat E31A as if it was E33G it is very easy to arrange bogus marriage for any remote workers earning US$60k and want to live in Indonesia, particularity like an Area in Canggu, Bali as a digital NOMAD. Is giving donation of Rp2m a month, free money to people without an income not enough as an incentive in Indonesia for doing nothing apart from allowing someone using their names on the paper. For the person in question it barely has consequences e.g nothing has emerged from the case like this someone get prison sentence as they are often be seen as a victim. Incentive from the other side, under certain religion it is very easy to divorce your wife. With E31A it is much easier to hide your overseas income.

Regarding the right to work on spouse visa, there are some examples I manage to collate, see below in post #9
 
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Here is information regarding the right to work on a spouse visa that I managed to collate. This comes directly from Immigration and Manpower. Some of the details also come from reputable members of this forum. These people do not benefit personally from sharing false information. Draw your own conclusions.
1736247964743.png

Sometimes, in seeking information, verification we fall into the trap of we only see what we want to see, and hear what we want to hear ... Also the potential issue will only become a problem once your case comes to light.

The frequent argument used by the other side is this law: UU_No_6_2011
"Holders of Limited Stay Permits as referred to in Article 52 letters e and f and holders of Permanent Stay Permits as referred to in Article 54 paragraph (1) letters b and d could undertake work and/or business to meet the NEEDS of supporting life of their families ".

I strongly believe you would face significant challenges convincing others, including the court, that a salary of over $60,000+ (the threshold for digital nomads) is solely intended to support family life, especially given Indonesia's average salary of around Rp5 million. Running a small warung to help your family survive or support your children's education might fall into this category. Many foreigners post vlogs on YouTube, Facebook, and Twitter showcasing this type of lifestyle, which immigration could potentially use as evidence. However, since no one has been arrested/deported for this, it appears to be an accepted activity fall into the category of supporting life of your family.

But I agree this is a grey area but the one I posted in #2 is written information and you already agree to this term, before applying E31A VITAS. If a consenting adult agrees to certain terms, challenging those terms in court would be difficult, not just in Indonesia, but anywhere in the world.

Also, to challenge Immigration using UU No. 6 of 2011, the case would need to be brought before the Constitutional Court. In typical cases in Indonesia, the foreigners would have been deported before their case even has the chance to be heard.
 
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Are we talking about the souse sponsor VISA E31A VITAS or remote workers, (NOMAD visa) e.g E33G VITAS

For remote workers, (NOMAD visa) E33G VITAS there is a requirement. You will need to have
Employment contract with a company established outside the Indonesian Territory.
Also, a bank account that proves income in the form of salary or income worth at least US$60,000 per year;

Once you have shown earning of US$60k and have Indonesia residency you are a subject of Indonesia income tax.


I believe this is a personal interpretation, I never see anywhere that this information ever stated in official Indonesian Immigration, Manpower. Would like to be proven wrong. And Why there is E33G VITAS ?

If you could treat E31A as if it was E33G it is very easy to arrange bogus marriage for any remote workers earning US$60k and want to live in Indonesia as a digital NOMAD. With E31A there is a way to hide or overseas income.
Regarding the right to work on souse visa, here are some examples.
You do not have to have a nomad visa if you have spouse sponsored KITAS.
 
You do not have to have a nomad visa if you have spouse sponsored KITAS.
What is the purpose of E31A VITAS and
What is the purpose E33G VITAS ?

For restriction of E31A family VITAS see post #9 and refer to the law: UU_No_6_2011
 
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I believe this is a personal interpretation, I never see anywhere that this information ever stated in official Indonesian Immigration, Manpower. Would like to be proven wrong on this. And Why there is E33G VITAS?

If you could treat E31A as if it was E33G it is very easy to arrange bogus marriage for any remote workers earning US$60k and want to live in Indonesia as a digital NOMAD. Is giving donation of Rp2m a month, free money to someone without an income not enough as an incentive ?? Also under certain religion it is very easy to divorce your wife. With E31A there is a way to hide your overseas income, an incentive from the other side.

Regarding the right to work on spouse visa, there are some examples I manage to collate, see below in post #9
Yes what I should have said is: "2) if you are in Indonesia with a spouse visa but working for an entity abroad under a foreign contract, the Indonesian authorities do not take an interest. [Theoretically they could, but practically they don't]

There is no way of getting a work permit under these circumstances, and you're not taking any work away from Indonesian people, so why would immigration or manpower have a problem with it? You could even pay tax on this income if you want to and are able to get a tax number.
 
Yes what I should have said is: "2) if you are in Indonesia with a spouse visa but working for an entity abroad under a foreign contract, the Indonesian authorities do not take an interest. [Theoretically they could, but practically they don't]

There is no way of getting a work permit under these circumstances, and you're not taking any work away from Indonesian people, so why would immigration or manpower have a problem with it? You could even pay tax on this income if you want to and are able to get a tax number.
Correct.
Work in Indonesia is illegal without work permit (except rare exceptions).

Nomad visa is of no interest for the Ministry of Labor as it is for a work for a foreign entity (that is why is regulated by ministerial regulation). Minstry of Labor does not care about it at all.

Spouse ITAS (and some other one-ex Indonesians etc) are allowed to work by virtue of the Immigration Law. For work offshore, no work permit is necessary, as Ministry of Labor does not care about work for offshore entity.
 
Here is information regarding the right to work on a spouse visa that I managed to collate. This comes directly from Immigration and Manpower. Some of the details also come from reputable members of this forum. These people do not benefit personally from sharing false information. Draw your own conclusions.
View attachment 4576
Sometimes, in seeking information, verification we fall into the trap of we only see what we want to see, and hear what we want to hear ... Also the potential issue will only become a problem once your case comes to light.

The frequent argument used by the other side is this law: UU_No_6_2011
"Holders of Limited Stay Permits as referred to in Article 52 letters e and f and holders of Permanent Stay Permits as referred to in Article 54 paragraph (1) letters b and d could undertake work and/or business to meet the NEEDS of supporting life of their families ".

I strongly believe you would face significant challenges convincing others, including the court, that a salary of over $60,000+ (the threshold for digital nomads) is solely intended to support family life, especially given Indonesia's average salary of around Rp5 million. Running a small warung to help your family survive or support your children's education might fall into this category. Many foreigners post vlogs on YouTube, Facebook, and Twitter showcasing this type of lifestyle, which immigration could potentially use as evidence. However, since no one has been arrested/deported for this, it appears to be an accepted activity fall into the category of supporting life of your family.

But I agree this is a grey area but the one I posted in #2 is written information and you already agree to this term, before applying E31A VITAS. If a consenting adult agrees to certain terms, challenging those terms in court would be difficult, not just in Indonesia, but anywhere in the world.

Also, to challenge Immigration using UU No. 6 of 2011, the case would need to be brought before the Constitutional Court. In typical cases in Indonesia, the foreigners would have been deported before their case even has the chance to be heard.
You cannot run any small warung. The guy from your messages was deported (teaching English, smart ass).
 
You cannot run any small warung. The guy from your messages was deported (teaching English, smart ass).
In the above example, as I understand it, the small business (warung) is officially owned by his spouse and the guy helping them. If on the background the foreigner is actually the one running the show collect the money, it is a different matter. This case is very difficult to be proven without both people being found guilty. If the foreigners are working and earning income, it will mean they will need to declare it as an income, and thus taxable.
 
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.... so why would immigration or manpower have a problem with it? You could even pay tax on this income if you want to and are able to get a tax number.
This could be explained by the fact that many people tend to stay silent if it brings financial benefits to themselves or the country. This is particularly true if the funds could be diverted to unauthorized accounts rather than official government revenue or tax offices, and even more so if the money can be shared among employees of certain offices, directorates to be added to their employee's welfares.

Previously, in another discussion on this forum, it was mentioned that some of the most significant corruption cases in Indonesia involve individuals from customs and the inland revenue office.
Nomad visa is of no interest for the Ministry of Labor as it is for a work for a foreign entity (that is why is regulated by ministerial regulation). Ministry of Labour does not care about it at all.
And why in E33G VITAS there are requirements for:
Employment contract with a company established outside the Indonesian Territory.
Also, a bank account that proves income in the form of salary or income worth at least US$60,000 per year;
Both of these evidences are enough to serve as evidence that you have a taxable income that could be used if needed. It has been reported in some occasions what the digital nomad is doing to avoid income tax in Indonesia is to do a visa run before the 183 days mark is reached.

Not to mention. unlike Singapore, Indonesia adopts the global income taxation where your foreign income even you do not earn it in Indonesian territory, is still subject to Indonesian taxation if you are an Indonesian tax residence. Certainly for foreign income, it will need to take into account the DTA agreement between the two countries.

Also I remember reading a case someone get caught to have undeclared foreign income from renting his house in his home country. He will need to negotiate the fine.
Spouse ITAS (and some other one-ex Indonesians etc) are allowed to work by virtue of the Immigration Law. For work offshore, no work permit is necessary, as Ministry of Labor does not care about work for offshore entity.
As I have mentioned before, I have yet to come across any official written documentation on this matter whether from the Manpower or Immigration websites, official emails, or similar sources that could serve as a reliable defence if needed. Even More trustable is the extract from the law with no ambiguity. I would like to be proven wrong in this case. The verbal statements from one immigration official cannot be used as a valid defence, as when you need it they might not be there or they could easily deny what he said.
 
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... It has been reported in some occasions what the digital nomad is doing to avoid income tax in Indonesia is to do a visa run before the 183 days mark is reached.
To interested people , it is important to clarify that , in my view , this action will not (theoretically) avoid income tax in Indonesia because even if you are with a Visit Visa this "183 days" does not means "uninterrupted 183 days" .
Also , this "183 days" rule is irrelevant if you get any e-ITAS/KITAS , because if so , the "reside in Indonesia" or "intention to reside in Indonesia" are applicable (see below) .

In practice if you are with a Visit Visa/Stay Permit or any e-ITAS/KITAS other than "Work e-ITAS/KITAS" , income tax has not been a concern up to now , as far as I know .

---------------------------------

Omnibus Law (UU no.11 Year 2020) .
Article 1 1 1 - free translation
... Tax Subjects are differentiated into Inside/Domestic Tax Subjects and Outside/Abroad Tax Subjects.
(3) The Inside/Domestic Tax Subjects are:
a. private persons, whether they are Indonesians or foreigners, who:
1. reside in Indonesia;
2. has been in Indonesia for more than 183 (one hundred and eighty three) days within any period of 12 (twelve) months; or
3. in a tax year, are residing in Indonesia and have the intention to reside in Indonesia;
.....
 
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To interested people , it is important to clarify that , in my view , this action will not (theoretically) avoid income tax in Indonesia because even if you are with a Visit Visa this "183 days" does not means "uninterrupted 183 days" .
Also , this "183 days" rule is irrelevant if you get any e-ITAS/KITAS , because if so , the "reside in Indonesia" or "intention to reside in Indonesia" are applicable (see below) .

In practice if you are with a Visit Visa/Stay Permit or any e-ITAS/KITAS other than "Work e-ITAS/KITAS" , income tax has not been a concern up to now , as far as I know .

---------------------------------

Omnibus Law (UU no.11 Year 2020) .
Article 1 1 1 - free translation
... Tax Subjects are differentiated into Inside/Domestic Tax Subjects and Outside/Abroad Tax Subjects.
(3) The Inside/Domestic Tax Subjects are:
a. private persons, whether they are Indonesians or foreigners, who:
1. reside in Indonesia;
2. has been in Indonesia for more than 183 (one hundred and eighty three) days within any period of 12 (twelve) months; or
3. in a tax year, are residing in Indonesia and have the intention to reside in Indonesia;
.....

Unlike the E31A visa, the E33G visa allows individuals to apply for an ITAS only if they choose to. This provides a way to avoid becoming a tax resident, as people can opt not to apply for an ITAS and leave Indonesia before reaching the 183 day threshold. They could then switch to another type of visa, such as a 60-day visitor visa, leave before the 60-day period ends, and return with an E33G visa to repeat the cycle. House does it sound ?

The cost of the E33G visa is relatively affordable:
  • Visa Fee: Rp500,000
  • Verification Fee (Category II): Rp2,000,000
For people with the minimum income of US$60k pa, there is an incentive to avoid obtaining an ITAS because having one automatically designates them as Indonesian tax residents, requiring them to register for an NPWP. Also keep in mind they are digital NOMAD where they could work from anywhere in the world.
 
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In practice if you are with a Visit Visa/Stay Permit or any e-ITAS/KITAS other than "Work e-ITAS/KITAS" , income tax has not been a concern up to now , as far as I know .
AFAIK, People with ITAS/ITAP will automatically become an Indonesian tax residence designates them as Indonesian tax residents, requiring them to register for an NPWP. Having an NPWP it is mandatory to do an annual tax return.
 
As I have mentioned before, I have yet to come across any official written documentation on this matter whether from the Manpower or Immigration websites, official emails, or similar sources that could serve as a reliable defence if needed. Even More trustable is the extract from the law with no ambiguity. I would like to be proven wrong in this case. The verbal statements from one immigration official cannot be used as a valid defence, as when you need it they might not be there or they could easily deny what he said.
Show me the man, I will show you the crime.

The law is pretty clear. Immigration/Government does not give such explanations in writing usually.
In theory, if you have big money coming that way and become visible, they can come anyway and harass you and squeeze you for money.
 

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