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Legal
PT PMA: when you need one, and when you do not
The foreign-owned Indonesian company — what it lets you do, what it costs to form and keep running, and the case for not forming one.
Published 21 September 2026 · Updated 3 November 2026 · 6 min read
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What it is actually for
A PT PMA exists so a foreign investor can operate a business in Indonesia. Holding property is a consequence of that, not the purpose. If your villa will be rented to guests, you are running a business, and the company is how that is done lawfully — including issuing invoices, paying the right taxes, and employing staff.
If the villa is where you live, the business rationale disappears and what remains is a compliance burden. A leasehold in your own name, or Hak Pakai if you hold a KITAS, does the same job with none of the filings.
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What changed in 2025, and what did not
BKPM Regulation 5/2025, effective 2 October 2025, cut the minimum paid-up capital for a PT PMA from IDR 10 billion to IDR 2.5 billion per KBLI code — a genuine 75% cut in the cash you must put in. It did not touch the total investment plan behind that business line, which must still exceed IDR 10 billion excluding land and buildings, so most of the actual commitment is unchanged; only the deposited-capital slice of it shrank.
The capital also no longer has to land on day one. A signed capital declaration filed through OSS is accepted at registration, with the deposit due once the company’s bank account is open — though the deposited funds are then locked for twelve months unless spent on assets, construction or genuine operations.
| Home you live in | Villa you rent out | |
|---|---|---|
| Right structure | Leasehold or Hak Pakai | PT PMA holding HGB |
| Minimum paid-up capital | None | IDR 2.5bn per KBLI code (BKPM Reg 5/2025) |
| Total investment plan required | None | Above IDR 10bn per KBLI code, excl. land and buildings |
| Ongoing filings | None tied to the title itself | Quarterly LKPM, monthly and annual tax returns |
Forming one: the steps and what they actually take
The sequence is a notarial deed of establishment, approval from the Ministry of Law and Human Rights (now near-instant once the deed is filed correctly), a business identification number (NIB) issued through the OSS system, and an NPWP. Company-formation consultancies who process these routinely report four to eight weeks end to end for a straightforward, low-risk KBLI code with documents ready — treat that as a planning estimate, not a guarantee, since actual processing time depends on how the specific business activity is licensed.
- Minimum two shareholders, one director and one commissioner — a foreign individual can hold shares directly, with no local nominee required for ownership itself.
- The KBLI code matters more than the words on the brochure. Real estate that is owned or leased (KBLI 68111) is generally reported open to full foreign ownership nationally, but since the third week of May 2026 OSS no longer licenses a new PT PMA in Bali for it, nor for 55900 (other accommodation) or hotels under 6,000 m² (Governor Koster, Antara, 23 July 2026; see the guide to the 18 closed codes). Some accommodation-specific codes carry a foreign-ownership cap that requires an Indonesian partner. Check which code your notary is actually registering, and that OSS issues it in Bali today.
- A registered domicile address is required before the company can operate, and it has to remain valid — a lapsed address is a compliance gap, not a formality.
The ongoing obligations people underestimate
The formation cost is the part everyone quotes and the smallest part of the total. A PT PMA files a quarterly Investment Activity Report (LKPM) through OSS whether or not it has traded, and reporting has real teeth: persistent non-submission is grounds for the business licence itself to be revoked. Letting any of this lapse is how a structure that looked clean at purchase becomes an obstacle at sale.
- Quarterly LKPM filed through OSS, every quarter, with no exemption for a dormant year.
- Monthly tax filings even in months with no revenue.
- Annual corporate tax return and investment-activity reporting.
- BPJS Health and Employment enrolment once the company has staff.
- A registered office address that must remain valid.
Closing one down costs more than people expect
A PT PMA formed for a villa that never earned, or stopped earning, does not simply go quiet. Winding it up lawfully runs through a shareholders’ resolution, a court-registered liquidator, a minimum 60-day public creditor-notice period, and a tax office audit before the company’s tax number can be deleted — a process reported at six to twelve months even for a company with nothing real to unwind, and longer if compliance lapsed while it sat dormant. Leaving it unattended does not make it cheaper to close later; the backlog of missed filings has to be resolved before closure can even begin.
Common questions
Do I need a PT PMA to buy a villa in Bali?
Not to live in one. A leasehold in your own name is simpler and cheaper. You need a PT PMA if the property will earn rental income.
Can a PT PMA own land outright?
It can hold Hak Guna Bangunan — the right to build and use, for 30 years, extendable. It cannot hold Hak Milik, which remains reserved for Indonesian citizens.
How much capital do I need for a PT PMA in 2026?
IDR 2.5 billion in paid-up capital per KBLI code, since BKPM Regulation 5/2025 took effect on 2 October 2025. The total investment plan behind that business line still has to exceed IDR 10 billion, excluding land and buildings.
How long does it take to set up a PT PMA in Bali?
Company-formation consultancies report four to eight weeks for a straightforward, low-risk KBLI code with documents ready. Sector-specific licensing on top of the base company can take longer.
Can I close a PT PMA quickly once the villa stops earning?
No. Dissolution is reported to take six to twelve months even for a simple, low-activity company, driven by the creditor-notice period and the tax office’s audit — and longer if filings had already lapsed.
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General information, not legal or tax advice. Formation timelines, KBLI foreign-ownership limits and LKPM enforcement are reported by Indonesian company-formation consultancies rather than confirmed here against a single OSS or BKPM notice; confirm current requirements with a licensed company-formation adviser before forming a company.