Determining whether a taxpayer qualifies as a resident taxpayer is a fundamental aspect of Indonesia’s tax system. This classification not only establishes the taxing rights of the Indonesian tax authorities but also defines the taxpayer’s obligations to file returns and pay taxes in Indonesia.
Importantly, taxpayer status does not always correspond to citizenship. Indonesian citizens may be classified as non-resident taxpayers, while foreign nationals may qualify as resident taxpayers. For this reason, a clear understanding of the criteria and rules governing resident taxpayer status is essential, particularly following the issuance of the latest regulations.
This article provides a comprehensive overview of resident taxpayers under the Director General of Taxes Regulation Number PER-23/PJ/2025.
Legal Basis for Determining Resident Taxpayer Status
The most recent provisions governing the determination of resident and non-resident taxpayers are set out in PER-23/PJ/2025. This regulation was introduced to provide greater legal certainty, as previous regulations, PER-02/PJ/2009 and PER-43/PJ/2011, were no longer fully aligned with current legislative developments.
PER-23/PJ/2025 was issued with reference to the Income Tax Law, as amended by Law of the Republic of Indonesia Number 6 of 2023 (Job Creation Law).
Definition of Resident Taxpayers
In general, resident taxpayers include:
- Individuals, whether Indonesian citizens or foreign nationals, who:
- reside in Indonesia;
- stay in Indonesia for more than 183 days within 12 months; or
- stay in Indonesia during a fiscal year with the intention to reside.
- Entities, including bodies established or domiciled in Indonesia.
- Undivided inheritance, treated as a single entity that replaces the entitled party.
Resident Individual Taxpayers
As outlined above, individuals may be classified as resident taxpayers if they are considered to reside in Indonesia. Under PER-23/PJ/2025, individuals are deemed to reside in Indonesia if they meet the following conditions:
- They reside in a location in Indonesia that:
- is under their control or can be accessed at any time;
- is owned, rented, or otherwise available for use; and
- is not merely a temporary stopover.
- They have a primary activity center in Indonesia, whether for personal, social, economic, or financial purposes.
- They engage in daily habits or activities in Indonesia, including routine tasks, hobbies, or social interactions.
Individuals are also classified as resident taxpayers if they are physically present in Indonesia for more than 183 days within 12 months, whether continuously or intermittently. The count of days begins from their first arrival in Indonesia.
Additionally, individuals may also be designated as resident taxpayers if they demonstrate an intention to reside in Indonesia through the following documents:
- A Permanent Stay Permit (Kartu Izin Tinggal Tetap/KITAP).
- A Limited Stay Visa (Visa Tinggal Terbatas/VITAS) valid for more than 183 days.
- A Limited Stay Permit (Kartu Izin Tinggal Terbatas/KITAS) valid for more than 183 days.
- A contract or agreement for work, business, or activities in Indonesia lasting more than 183 days.
- Other documents indicating the intention to reside in Indonesia, such as a rental agreement for a residence lasting more than 183 days, or documents showing the relocation of family members.
Resident Corporate Taxpayers
Entities are classified as resident taxpayers if they meet either of the following criteria:
Establishment Status
An entity is considered a resident taxpayer if it is:
- established or formed under Indonesian laws and regulations;
- registered in Indonesia; or
incorporated within Indonesian jurisdiction.
Domicile Status
An entity may also qualify as a resident taxpayer if it:
- is domiciled in Indonesia;
- maintains its headquarters, administrative, or financial functions in Indonesia; or
has its management center located in Indonesia.
However, government institutions are excluded from resident taxpayer status, provided that they meet all of the following conditions:
- They are established under statutory regulations.
- Their funding is sourced from the state budget or provincial budget.
- Their revenues are recorded in the central or regional government budget.
- Their bookkeeping is audited by internal government auditors.
Legal References
- Law of the Republic of Indonesia Number 7 of 1983 concerning Income Tax, as amended by Law of the Republic of Indonesia Number 6 of 2023.
- Minister of Finance Regulation Number 18/PMK.03/2021.
- Director General of Taxes Regulation Number PER-23/PJ/2025 concerning Determination of Resident Taxpayers and Non-Resident Taxpayers.
The following section addresses some frequently asked questions on resident taxpayer status, reflecting current tax regulations and practice.
Are Indonesian citizens working abroad automatically classified as non-resident taxpayers?
No. Resident taxpayer status is determined by residence, duration of stay, and intention to reside, instead of citizenship. Indonesian citizens who meet the relevant criteria may still be classified as resident taxpayers.
How is the 183-day presence in Indonesia calculated?
The calculation is based on the total number of days of physical presence in Indonesia within 12 months, whether consecutive or intermittent, from the date of first arrival.
Does holding a KITAS or KITAP automatically classify you as a resident taxpayer?
Generally, possessing a KITAS or KITAP valid for more than 183 days is a strong indicator of the intention to reside in Indonesia and may establish resident taxpayer status.
