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An overview by PB Taxand, Taxand Indonesia
Under Indonesian tax law, a Domestic Tax Subject includes individuals and entities with significant ties to Indonesia. Individuals qualify if they reside in Indonesia, are present for more than 183 days in a 12-month period, or demonstrate intent to reside (e.g., via stay permits, employment contracts, or family relocation). Domestic entities include those established or domiciled in Indonesia, with central management, administration, or strategic decision-making located in the country.
Conversely, Foreign Tax Subjects are individuals or entities with limited presence in Indonesia, habitual residence abroad, or status as a domestic taxpayer in another jurisdiction, including foreign entities earning income or conducting business in Indonesia through a permanent establishment. The classification is based on actual facts and circumstances, affecting tax obligations and reporting requirements.
Tax experts from our Indonesian member firm PB Taxand have published a more detailed overview of the status determination of tax subjects here.
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