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Everything you need to know before buying real estate is included in our Indonesia Property Pack
Understanding property taxes and fees in Indonesia is crucial for anyone considering real estate investment in this diverse archipelago nation. Indonesia applies a comprehensive system of taxes and fees to property transactions, with rates varying between residential and commercial properties, and specific requirements for both local and foreign investors.
If you want to go deeper, you can check our pack of documents related to the real estate market in Indonesia, based on reliable facts and data, not opinions or rumors.
Indonesia's property tax system includes an annual property tax (PBB) of 0.5% of assessed value for both residential and commercial properties, plus various transaction fees.
Buyers face a 5% transfer tax (BPHTB), while sellers pay 2.5% capital gains tax, with additional notary fees of 0.5-1% of transaction value.
| Tax/Fee Type | Rate | Who Pays |
|---|---|---|
| Annual Property Tax (PBB) | 0.5% of assessed value | Property Owner |
| Transfer Tax (BPHTB) | 5% of transaction value | Buyer |
| Capital Gains Tax | 2.5% of sale value | Seller |
| Notary Fees | 0.5-1% of transaction value | Buyer/Seller |
| Land Registration | ~0.2% of transaction value | Buyer |
| Stamp Duty | IDR 10,000 per document | Both parties |
| Late Payment Penalty | 2% per month | Property Owner |
Fact-checked and reviewed by our local expert
Daniel Rouquette 🇫🇷
CEO & Co-Founder at Villa Finder
What is the annual property tax rate for residential properties in Indonesia?
The annual property tax for residential properties in Indonesia is set at 0.5% of the property's assessed value, known as the Tax Object Assessment Value (NJOP).
Some regional governments apply progressive tax rates based on property value tiers. Properties valued up to IDR 200 million are taxed at 0.01%, while those between IDR 200 million and IDR 2 billion face a 0.1% rate.
Higher-value residential properties face steeper rates: 0.2% for properties worth IDR 2-10 billion, and 0.3% for those exceeding IDR 10 billion. These progressive rates help ensure that luxury property owners contribute proportionally more to local government revenues.
As of September 2025, most residential property owners in major cities like Jakarta and Bali pay the standard 0.5% rate on their annual property tax bills. The tax is collected by local governments and funds municipal services and infrastructure development.
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What is the annual property tax rate for commercial or industrial properties in Indonesia?
Commercial and industrial properties in Indonesia are subject to the same base annual property tax rate of 0.5% of the assessed property value.
Local governments have the authority to adjust these rates or implement progressive taxation similar to residential properties. Some municipalities may apply different rates for specific commercial zones or industrial areas based on their development priorities.
Industrial properties in special economic zones may qualify for tax incentives or reduced rates as part of government investment promotion programs. Commercial properties in prime locations like Jakarta's central business district or Bali's tourism areas typically face the full 0.5% rate.
Property owners should verify the exact rate with their local tax office, as regional variations can affect the final tax amount significantly.
What are the transfer taxes or fees when buying a property in Indonesia?
The primary transfer tax when buying property in Indonesia is the BPHTB (Bea Perolehan Hak atas Tanah dan Bangunan), which amounts to 5% of the Tax Object Acquisition Value (NPOP).
This 5% rate applies after deducting a non-taxable threshold (NPOPTKP) that varies by region but typically ranges from IDR 60-80 million for residential properties. The buyer is responsible for paying this transfer tax as a one-time fee during the property acquisition process.
The transfer tax must be paid before the property title can be legally transferred to the new owner. This tax serves as a significant source of revenue for local governments and helps regulate property transactions across Indonesia's diverse markets.
Foreign buyers face the same 5% transfer tax rate as Indonesian citizens, making this a uniform cost across all property transactions regardless of buyer nationality.
What are the notary and legal fees involved in a property transaction?
Notary fees in Indonesia typically range from 0.5% to 1% of the total property transaction value, depending on the complexity of the deal and regional variations.
These fees cover the preparation and authentication of essential documents including the sale and purchase agreement, power of attorney documents, and deed of sale. The notary plays a crucial role in ensuring all legal requirements are met during the property transfer process.
| Service Type | Fee Range | Description |
|---|---|---|
| Basic Notary Services | 0.5% of transaction value | Standard document preparation and signing |
| Complex Transactions | 0.7-1% of transaction value | Multiple parties or commercial properties |
| Due Diligence Review | IDR 5-15 million fixed fee | Property title verification and legal checks |
| Translation Services | IDR 500,000-2 million | Document translation for foreign buyers |
| Power of Attorney | IDR 1-3 million | For buyers unable to attend signing |
| Additional Legal Consultation | IDR 2-5 million per hour | Specialized legal advice beyond standard services |
Legal fees for additional services like due diligence reviews, contract negotiations, or specialized legal advice are typically charged separately and can add IDR 10-50 million to the total transaction cost depending on property value and complexity.
What are the land registration fees when purchasing property?
Land registration fees in Indonesia are typically around 0.2% of the property transaction value, though this can vary significantly between different municipalities and regions.
These fees cover the cost of updating the land certificate (Sertifikat Hak Milik for freehold or other appropriate certificates for different ownership types) and registering the new owner's details with the National Land Agency (Badan Pertanahan Nasional).
The registration process includes verification of the property's legal status, boundary surveys if required, and issuance of the new certificate in the buyer's name. Processing times typically range from 2-6 weeks depending on the location and complexity of the property.
Additional fees may apply for expedited processing or if property boundary disputes need resolution during the registration process.
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Are there any stamp duties or document taxes applied to property transactions?
Indonesia applies a stamp duty (Materai) to official property transaction documents, currently set at IDR 10,000 per document.
This stamp duty is mandatory for all legal documents related to property transactions, including sale agreements, transfer deeds, mortgage documents, and power of attorney forms. While the individual amount is relatively small, multiple documents in a single transaction can accumulate this fee.
The stamp duty serves as a form of document authentication and is required by Indonesian law for all significant legal and financial documents. Both buyers and sellers may need to pay stamp duties on their respective documents during the transaction process.
Failure to properly stamp documents can render them legally invalid, so ensuring compliance with stamp duty requirements is essential for all property transactions.
What are the annual land lease fees, if the property is not owned freehold?
For leasehold properties in Indonesia, annual land lease fees are specified in individual lease agreements rather than being government-regulated, making costs highly variable depending on location and property type.
While lessees don't pay direct taxes on the lease arrangement, lessors (property owners who lease out their land) must pay a 10% final income tax (PPh Final) on all lease income received. This tax burden is typically factored into lease pricing structures.
Lease fees in popular areas like Bali or Jakarta can range from IDR 50-500 million annually for residential properties, depending on size, location, and lease terms. Commercial leases command significantly higher annual fees based on business potential and location premium.
Foreign investors should carefully review lease agreements as terms, renewal options, and fee escalation clauses can significantly impact long-term investment returns.
What are the ongoing maintenance or community fees for properties in Indonesia?
Maintenance and community fees apply primarily to apartment complexes, gated communities, and managed residential developments, with costs typically ranging from IDR 10,000 to IDR 30,000 per square meter per month.
These fees are set by property management companies or homeowner associations rather than government regulation, leading to significant variation based on facility quality and services provided. Luxury developments with extensive amenities like swimming pools, gyms, and 24-hour security command higher monthly fees.
- Basic apartment maintenance (older buildings): IDR 8,000-15,000 per sqm monthly
- Mid-range condominiums with standard amenities: IDR 15,000-25,000 per sqm monthly
- Luxury developments with premium facilities: IDR 25,000-50,000 per sqm monthly
- Gated community houses with shared facilities: IDR 200,000-2,000,000 per unit monthly
- Villa complexes with resort-style amenities: IDR 500,000-5,000,000 per unit monthly
Property owners should budget for these ongoing costs as they're mandatory for maintaining property value and accessing shared facilities and services.
What are the capital gains taxes when selling a property?
Property sellers in Indonesia pay a final income tax (PPh Final) of 2.5% of the gross sale value, regardless of the actual profit made on the transaction.
This 2.5% rate applies to both residential and commercial property sales, calculated on the total sale price rather than the net capital gain. For leasehold properties, lessors face a higher 10% final income tax rate on lease income, which can affect sale calculations.
The tax must be paid before the property transfer can be completed, making it a mandatory cost that sellers must factor into their pricing strategies. Unlike capital gains taxes in some countries, Indonesia's system doesn't provide deductions for holding periods or property improvements.
Foreign sellers face the same 2.5% rate as Indonesian citizens for property sales, but may face additional withholding tax complications depending on their residency status and tax treaty agreements.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Indonesia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
Are there different tax rates for foreigners compared to Indonesian citizens?
Property tax rates in Indonesia are identical for foreign and domestic property owners, with no discrimination based on nationality for basic property taxes, transfer taxes, or capital gains taxes.
However, non-resident foreigners face a flat 20% withholding tax on all Indonesian-sourced income, including rental income from Indonesian properties. This significantly impacts foreign investors who plan to generate rental income from their Indonesian real estate investments.
Foreign ownership restrictions do affect the types of properties foreigners can purchase, with different rules for apartments versus land ownership, but the tax rates remain consistent once legal ownership is established. Foreigners typically must purchase through specific ownership structures like Right to Use (Hak Pakai) titles.
Tax treaty agreements between Indonesia and the buyer's home country may provide some relief from double taxation, but professional tax advice is essential for foreign investors to optimize their tax position.
What are the inheritance or gift taxes applied to property transfers?
Indonesia generally does not impose direct inheritance or gift taxes on property transfers between family members, making it relatively favorable for estate planning purposes.
However, property transfers through inheritance or gifts may still be subject to the 5% transfer tax (BPHTB) depending on local regulations and the relationship between the parties involved. Some regions provide exemptions for direct family transfers (spouse to spouse, parent to child).
The absence of formal inheritance tax doesn't eliminate all costs, as legal fees, notary fees, and property registration fees still apply to formalize ownership transfers. These costs typically range from 1-2% of the property value depending on complexity.
Foreign inheritance situations become more complex due to ownership restrictions and may require restructuring property ownership through Indonesian entities or trusts to ensure legal compliance.
It's something we develop in our Indonesia property pack.
What are the penalties or late payment fees if property taxes are not paid on time?
Property owners who fail to pay their annual property taxes on time face penalties of 2% per month on the unpaid tax amount, which can accumulate quickly and significantly increase the total tax burden.
These penalties continue to compound monthly until the full tax amount plus accumulated penalties are paid in full. For example, a property with IDR 10 million in annual taxes would incur an additional IDR 200,000 penalty each month it remains unpaid.
| Delay Period | Penalty Rate | Example Cost (IDR 10M base tax) |
|---|---|---|
| 1 month late | 2% | IDR 200,000 |
| 3 months late | 6% cumulative | IDR 600,000 |
| 6 months late | 12% cumulative | IDR 1,200,000 |
| 12 months late | 24% cumulative | IDR 2,400,000 |
| 24 months late | 48% cumulative | IDR 4,800,000 |
Local tax authorities may also initiate collection procedures for severely delinquent properties, potentially including property liens or forced sales to recover unpaid taxes and penalties. Property owners should prioritize timely tax payments to avoid these escalating costs and potential legal complications.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Understanding Indonesia's property tax structure is essential for making informed real estate investment decisions in this rapidly growing Southeast Asian market.
With relatively straightforward tax rates and no discrimination against foreign investors, Indonesia offers a transparent framework for property ownership and investment across its diverse regions.
Sources
- Arya Properties - Property Taxes in Indonesia Explained
- Invest Islands - Indonesia Property Tax for Foreigners Guide
- Wikipedia - Taxation in Indonesia
- Indonesia Real Estate - Property Taxes for Foreigners
- Own Property Abroad - Indonesia Buying Property Taxes
- KPMG - Indonesia Tax Guide 2018
- Exotiq Property - Property Taxes in Bali
- Bright Tax - US Expat Taxes in Indonesia