One thing that often happens when people come on a holiday to Bali is they start getting dreamy “ideas about their future”.
They lay on a beach and all these wonderful ideas come to mind, and those ideas make Moving to Bali seem like such a great idea.
Ideas such as:
I could volunteer here and help out some poor people, or teach English to kids or use my skill to volunteer my time….great idea, yep I will do that.
Another idea often floated, while sitting at your gorgeous villa pool…gee, I could rent this villa long term and then my friends could rent if off me when I visit home, I could advertise it on AirBnB and I could make lot of money I could just live in Bali half the year…why didn’t I think of this sooner?
Or, I really could live here full time, OMG it is amazing, the people are amazing, the weather is amazing, imagine having my massages weekly, my laundry done, never iron again, I could even get a maid, OMG, I could so live here, I should started looking at the job market here…..I should have checked it out sooner.
I am going to buy a villa here...I saw one in the paper back home, they were selling them quite cheap, and now that I am here and I am in love with Bali, I am going to buy one…I am so excited.
Or, I think I will retire here…yep, when I retire in a few years, I will sell up my house and move to Bali, the grandkids will love visiting me here….Oh, my retirement dream.
The last one….boy if only I started a business doing [insert brilliant idea, niche market idea here], I could make a killing, they really need that [brilliant idea] here, I am going to start a business in Bali….I will make so much money, I can work on my laptop near the pool, stupid me working long hours back home for not much.
So, those ideas sound wonderful after a few relaxing massages, a lot of drinks and lots of nice smiling people serving you on your “holiday”.
But, can they be a reality?
Well, they can, people of course have done all of the above at some time. But what about the legality’s, the logistics and THE COSTS.
Let’s start with the easiest one.
RETIREMENT IN BALI:
You can get a retirement visa here from 55 years of age. The requirements simplified are:
• Proof of minimum income of US$1,500 per month, so from a Pension Fund or a bank account/super policy etc
• Proof of medical/health Insurance, life insurance, and third-party personal liability insurance (this can be very expensive when over 55)
• Minimum spend on accommodation of US$35,000 if you lease (purchase of sorts) an apartment/home long term or, a minimum rental spend of US$300 per month
• You must employ a Maid
• YOU MAY NOT WORK in Indonesia on this visa! No volunteering, nothing, you must retire.
• This visa can only be sponsored by a licensed agent (there are about 100 agents in Indonesia licensed to sponsor this type of visa)
Costs for the visa are around 5-7 million for the first year, it’s all pretty easy if you have a support network of other retirees already in Bali and choose an area with other retirees so you don’t need to learn the language straight away.
If you wish to live out on a mountain or in the Jungle there will be a few more obstacles, easily avoided if you are fluent in the language and learn about the Customs and become part of the local community.
STARTING A BUSINESS IN BALI:
I will only use examples if you are a foreigner wanting to live and run a secure legal business here (this does not relate to mixed marriages to locals etc).
Easily done here actually, you just need a LOT of money, you cannot start a business without a company, the company can then employee you to work here.
A foreign investment company is called a PT PMA, and there are only certain sectors open up to foreign investment every year. Some give 100% ownership, down to 49%, it will depend on the industry, not all industries are open to foreign investment…interested in the industry sectors? Google ‘Indonesian Foreign Negative Investment List’
It does not cost that much to set up a company, maybe about US$3000 for set up, and with the company you will get foreign work permits to work here legally…if it’s small business you will get 2 work permits, the bigger the company the more work permits…allow US$2400 per year for 2 work permits and until you can do your visa yourself you will need to pay a bit for the visas called KITAS’s as well, so allow another US$1000 per visa.
Now, the biggie! Indonesia currently requires 10 BIllion Rupiah (ONE MILLION AU DOLLARS, I wrote that in words so you didn’t think I got my zeros wrong) to start a foreign company….a cash 2.5 Billion (AU$250,000) equity injection is required upfront…..if you have this, then you are good to go…..so the ‘little’ business you were thinking about maybe a little bit costly to start, maybe wait and retire here.
VOLUNTEERING IN BALI:
Well……… it’s called working here, paid or unpaid work is called WORKING, no matter what you call it from where you are from, here it is called working.
To work legally in Bali you need a working visa which is called a KITAS and a work permit which is called an IMTA.
The company will have to be a foreign company or a large local company, small local businesses cannot employ you (so no local schools, Orphanages etc). The company you volunteer for must have applied (can be done once a year, usually done every 3 years) for the number of foreign workers/volunteers they require in the future.
This is done at the Employment Board (Dept of Manpower), the company submit a lot of documents with a job description(s) of the skills needed (skills must higher than any Indonesian, and the IMTA's are only open to positions with degree qualifications), some company roles such as HR Manager can no longer be filled by a Foreigner.
The KITAS which you can receive after you are approved for a role and get your IMTA (note: the IMTA belongs to the Company not you, but in a volunteering case you will be expected to pay for it, US$100 per month, paid in advance) it generally takes a long time for Immigration to approve a KITAS to a new foreign worker and you must be overseas to collect it at an Indonesian Consulate, then come to Indonesia and then go to Immigration here, the KITAS is 6 months maximum unless a Director, some can be renewed, some can’t.
There are Age limits on some roles, for example for teachers it is 50 years. Note, for example: a Teacher must have of Bachelor of Education, at least 5 years’ experience in one specialty (for example maths), so if you thought you could just teach English guess again.
Now, there are some registered Charities in Bali that have actually applied for an exception to the rule and can obtain a different visa for voluntary roles that is called a social visa ….however, usually volunteers are expected to pass on their skills in their field (such as Management of Child Services etc) that can assist these charities on a short time basis. There are only a few charities (I only know of 2 in fact) in Bali that are approved to use this type of visa (they have Minister of Foreign Affairs approval).
So, really to volunteer you must have a work permit and a KITAS (it’s very expensive but if you want to volunteer your expertise and willing the pay the US$2000 for all the paperwork, then good on you!).
GETTING A JOB IN BALI:
There seems like a lot of us foreigners working in Bali, funny enough according to the Bali Employment Board there are less than 2000 foreigners legally working in Bali, and these numbers seem to dwindle every year……..seems like a lot of Foreign Yoga teachers in Ubud…..hmmmm.
Due to the strict requirements, costs etc then you can see why the numbers are so low, you cannot work here like you might be able to in another foreign country, you cannot come here and wait tables, do bar work, babysit, teach a class, cut hair, stack bricks, pick fruit, you can’t do any manual labor jobs (so back to volunteering, you cannot even legally help a local school build a roof or a paint and help build a house for some poor family). You will be deported if caught doing these type of jobs.
You cannot be employed for work here with just a Certificate qualification (unless you then have 10 years expertise in that field). You will need written references and a Skype interview with the Department of Manpower (they may also call your referees and ask for proof you worked there, such as pay slips etc).
To work here you must be an Expert, you must be more qualified than any Indonesian available on any Island…they must prove that you are better than any of the 10 million+ Indonesians that have qualifications in the same field.
BUYING A PROPERTY IN BALI:
As a foreigner you cannot own land in Bali…….now, if you have enough money to start that Business then you actually would have enough money to buy a lease here, long term….but you have legalities to follow…You must actually legally live in the villa to lease it long term…you must legally have the correct visa to live in Bali long term…and you cannot legally rent it out while you are not using it if you wish to come and go from Bali.
There is a very secure Title for people who are owners of companies to buy one house for them to reside in – it cannot be rented out, it has a maximum term of 80 years, it can be sold to a Indonesian, it is called a HGB.
This form of title (or lease) has been around since the 60’s and used for apartments in Jakarta and many hotels also have this type of lease (your company will own the property, the title is in your companies name).
There is a land title (a lease of sorts, however you ‘buy’ the property, it is registered in your name at the Titles Office) for people who have the retirement visa or the working visa (but don’t own the company, just an employee) called a Hak Pakai.
It has limitations, such as if you leave Bali, you have 1 year to sell it. If you live past the initial 25 year lease then you can renew it, however this has no precedent, as this type of Title has not been around more than 25 years so no-one knows if it will be renewed.
The other limitations are that you cannot rent it out and you cannot sell it to another foreigner…
So, best you only put all your savings into this title when you know you won’t live longer than 25 years…problem solved......unless the Grand kiddies were expecting an inheritance.
With both of the above you can only have 1 property, it must be your principal place of residence.
There was time when you could start a PMA company (as above under Starting a Business) to purchase property but the government has closed that window.
You may have a friend who has a “Nominee” contract on a house in Bali with a local friend…these are illegal and the government has announced that many times.
You may have a friend who has a lovely villa and rents it out….well, I do not know your friend, maybe they have a company, all set up legally to do that….
SUBLETTING A VILLA IN BALI:
Illegal.... there was a raid in Ubud a few weeks back looking at villas rented through the AirBnB site and facebook, which shows the government is getting very serious about Foreigners trying to make money illegally through property here:
They had a team, different tax departments and immigration were part of that team.
What they were looking for was any foreign “owned", I use that term lightly, Illegal Villas (without a license to rent out, not obtainable by a foreigner anymore), unpaid property taxes, unpaid income taxes (a Biggie, even if they are being rented from overseas with OS currency, the tax must be paid here).
Payment taken in foreign currency is illegal here, quoting in foreign currency is illegal here, unless it is on a website that converts the amount for you from Indonesian Rupiah (such as a Booking.com site etc).
Also, this one is very sad: unpaid health/pensions for local staff working in the illegal villas (if you don’t have a legal business then it would presumed you don’t have a tax file number, if you don’t have a tax file number then you cannot register to pay your local staff their entitled Medical/Pension funds).
The list went on….and if they happened to be occupied at the time of the knock on the door by the foreign “owner”, well, Immigration were so happy to hand over the very hefty fines, organize deportation (after their court date for all of the above other stuff), as Immigration officers now get bonuses for catching foreigners.
If the foreign “owner” was not there then they grilled the staff, or the tourist occupying the villa for their contact details and are now on a watch list just waiting for them to enter Bali.
The tax department were also very excited as there will be a lot of back taxes payable and huge fines, and as they broke the law, in a foreign country….well, that’s also very insulting here…..not good, and tax evasion in any country can end up where you don’t want to be.
Many people have been living in Bali for many years and were able to secure companies, property etc before law changes/price increases etc, so please do not presume anyone is illegal from this information. This information is for anyone contemplating moving here now or in the future.
They are getting really good with their teams now in Bali…we had a team of 40 visit us to check our business licenses etc, all good, they really enjoyed the coffee and banana pancakes….but we are a 100% legal company.
Just to note: Anyone who stays in Indonesia for longer than 180 days must register themselves for a tax file number and report their taxes. So, you do not have to be earning any income here, you just have to report your overseas income and assets yearly. It’s no biggie, if you are earning income overseas and paying tax you don’t pay tax here, you just need to report that. Don’t forget the Indonesian Tax Department was not afraid to go after Google.
My biggest piece of advice, and I am sure most long term Expats will agree with me, is learn the language, learn it well, and do not sell up everything in your home country until you have been living full time in Bali for a long time.
This information is in no way is legal advice, it is just a brief summary of my research that might help anyone with their “Future ideas on moving to Bali”, it is up to date when writing, however many laws change here constantly so always seek professional legal advice before making any major decisions.