Plans to Move to Bali: Would love your advise

[FINIT]

Hi, I am new to this forum.
My husband and I live in W Australia and visit Bali at least 4 times a year, sometimes holidays other time business. We are seriously considering moving over there but would love some advise.

We have done quite a bit of homework and have looked at land during our last visit. We are hopefuy planning to build villas and both rent them out to tourists and also plan to sell some over time.

I have checked out visa options but am a bit confused. With a Foreign investment company are you still able to lease land or do you have to buy freehold?

I have been told that building on leased land makes it easier to sell to the general tourist, what do you think?? I am also a bit confused with regards to the $100,000 USD that is needed to put into an Indonesian bank account: can this amount be touched or does it have to sit in an account, or is this the minimum investment required for the PMA??

I understand, and please correct me if I am wrong, that the PMA can appy for Kitas for the owners. How long does the Kitas give one residency for? Do you still have to renew visas every so often??

Also, with a PMA, I have read that there needs to be renewals every so often and the selling of a certain % of shares, is this correct and are there any problems associated with this??

I hope that I haven't asked to many questions and hope that someone can help me with some advise. Thanks

[Bert Vierstra]

Hi FINIT and welcome.

Regarding your villa rentals, make sure that are able to get a license for that. Things are getting tighter regarding licensing...

A PMA is able to "own land" by means of Hak Guna Bangunan, or the right to own / build buildings on a certain piece of land. 30 years renewable.

You would be able to sell shares of the company, and thus the owned land.

You still would be able to lease land with a PMA, but not own land through Hak Milik (freehold)

I don't know if "selling to the general tourist" is easier if its leased land. It depends a bit on the "general tourists" plans and purposes.

The USD 100.000 can be touched, afaik its just needed to show that you have some money to spend.

Yes, the PMA is entitled to apply for a Kitas for its Director etc. Its valid for 5 years, but has to be renewed every year (in Indonesia).

[FINIT]

Thankyou for your info Burt. Do you know where you have to appy for the villa rental licience? When you said that it is getting difficult to obtain a licience, is there a reason for this??
Thanks for your advise
Hayey (finit)

[Bert Vierstra]

By tighter I meant that you can not just start renting out villas without a suitable license, as has been common practice for some time. People have been deported (!) because they didn't comply.

What kind of license you will need depends on type and size of your operation.

A good start would be to talk with Ibu Lusi of http://www.bali-expat-business.com/ when the time has come.

[FINIT]

Hi Bert, Is this license the same sort that is needed by all businesses in Bali, and the cost is assessed by the nature and size of the business concern? This is ovbiously seperate to the PMA?? Do most people who operate a business over there do it by starting up a PMA? I have scoured the visa options and this seems to be the only way of working your own business, am I on the right track. I vaue your advise.
Thanks again
Hayey (finit)

[Bert Vierstra]

There is a difference in how you would set it up.

If (individual) people own a villa and rent it out while they are not there, they may have enough with a simple license such as the "Rumah Sewa" thing.

If you however manage multiple villas that are connected to your company in one or another way, your license would be more hotel like.

Imho, if you raise a PMA, and its business goals are stated as "property management" or something like that, it doesn't immediately imply that you will have a license to start renting out a villa complex, its a separate license.

Or, if you start a PMA for Villa development, it doesn't mean that you get a building permit right away.

(Just samples)

Sure, often people operating a business start a PMA, foreigners married to locals have other options.

But, like I said before, when you finally get your plans together, it would be wise to talk with someone like Ibu Lusi, people like that will be able to offer you a workable legal solution.

It all depends what your plans are.