Glossary
Indonesia Business Glossary
Plain-English definitions of the Indonesian business, tax, licensing and immigration terms founders and foreign investors run into most.
Company & Legal
PTPerseroan Terbatas (PT)PT stands for Perseroan Terbatas, Indonesia's limited liability company and the standard form for a locally owned business. Shareholders' liability is limited to their capital, and the company is a separate legal entity registered with the Ministry of Law. It is contrasted with a PT PMA when foreign ownership is involved.Read definitionPT PMAPT PMA (Foreign Investment Company)PT PMA (Penanaman Modal Asing) is an Indonesian limited liability company that allows foreign ownership. It is regulated as a foreign investment company, subject to the Positive Investment List that sets how much of each sector foreigners may own, and to higher capital and reporting requirements than a local PT.Read definitionAHUAHU (Legal Administration)AHU refers to the Directorate General of General Legal Administration (Administrasi Hukum Umum) under Indonesia's Ministry of Law, and to AHU Online, the system used to register companies and record corporate changes. A company's deed of establishment is approved here, and updates to directors, shareholders or articles are filed through it.Read definitionDPIPositive Investment ListThe Positive Investment List (Daftar Positif Investasi) is the regulation that defines which business sectors are open, conditional, or closed to foreign investment, and any ownership caps that apply. It replaced the older negative-list approach and is the starting point for deciding whether and how a foreigner can own a business in a given sector.Read definition
Licensing & Investment
NIBNIB (Business Identification Number)NIB (Nomor Induk Berusaha) is the Business Identification Number issued through the OSS system. It is a company's single primary business identity and, for many businesses, also acts as the import licence and customs identification. It is one of the first documents obtained after incorporation.Read definitionOSSOSS (Online Single Submission)OSS (Online Single Submission) is the Indonesian government's integrated online licensing platform. Its current risk-based version, OSS-RBA, is where a company obtains its NIB and the business licences required for its activities, with requirements scaled to the risk level of each KBLI.Read definitionKBLIKBLI (Business Classification Codes)KBLI (Klasifikasi Baku Lapangan Usaha Indonesia) is Indonesia's standard classification of business activities. Each KBLI code determines what a company is licensed to do, its risk level for licensing, and the foreign-ownership rules that apply, so choosing the correct codes is a key step when setting up a company.Read definitionLKPMLKPM (Investment Activity Report)LKPM (Laporan Kegiatan Penanaman Modal) is the Investment Activity Report that investment companies, including every PT PMA, must file periodically with BKPM. It reports how much of the planned investment has been realised and the company's operational status. Missing LKPM deadlines can lead to warnings and licence problems.Read definition
Tax
NPWPNPWP (Taxpayer ID Number)NPWP (Nomor Pokok Wajib Pajak) is the Indonesian Taxpayer Identification Number issued by the tax office (DJP) to individuals and companies. It is required to file and pay taxes, issue tax invoices, and complete many business and banking processes.Read definitionPPNPPN (Value-Added Tax)PPN (Pajak Pertambahan Nilai) is Indonesia's Value-Added Tax on the supply of goods and services. Businesses registered as PKP charge PPN on sales, issue e-Faktur tax invoices, and remit the tax monthly. The standard rate is currently 11%.Read definitionPPhPPh (Income Tax)PPh (Pajak Penghasilan) is Indonesian income tax, covering both corporate income tax (PPh Badan) and a family of withholding taxes such as PPh 21 on employee salaries and PPh 23, 26 and 4(2) on various payments. Most companies deal with PPh every month through withholding and instalments, and annually through the corporate return.Read definitionPKPPKP (VAT-Registered Business)PKP (Pengusaha Kena Pajak) is a business registered as a taxable entrepreneur for VAT purposes. Once turnover passes the registration threshold, a business must become PKP, charge PPN, issue e-Faktur invoices, and file monthly VAT returns.Read definitionSPTSPT (Tax Return)SPT (Surat Pemberitahuan) is a tax return filed with the tax office (DJP). Companies file monthly returns (SPT Masa) for taxes such as VAT and withholding, and an annual corporate return (SPT Tahunan). Filing on time is central to staying compliant and avoiding penalties.Read definitionSP2DKSP2DK (Tax Clarification Letter)SP2DK (Surat Permintaan Penjelasan atas Data dan/atau Keterangan) is a letter from the tax office asking a taxpayer to explain data or discrepancies it has noticed. It is not yet a formal audit, but how a company responds, and how well its records support the explanation, often decides whether the matter escalates.Read definitionCoretaxCoretax (Tax Administration System)Coretax is the tax authority's integrated tax administration system, used for registration, filing, payment and taxpayer accounts. It consolidates processes that were previously spread across separate platforms, so keeping company and tax data consistent within it matters for smooth filing.Read definition
Immigration & HR
KITASKITAS (Limited Stay Permit)KITAS (Kartu Izin Tinggal Terbatas) is Indonesia's Limited Stay Permit Card for foreigners. Common types include the investor KITAS for shareholders of a PT PMA and the work KITAS for employed foreigners; it is typically valid for one to two years and renewable.Read definitionKITAPKITAP (Permanent Stay Permit)KITAP (Kartu Izin Tinggal Tetap) is Indonesia's Permanent Stay Permit Card. It generally becomes available after a foreigner has held a KITAS for a qualifying period, and offers a longer validity with fewer renewals.Read definitionRPTKARPTKA (Foreign Worker Plan)RPTKA (Rencana Penggunaan Tenaga Kerja Asing) is the Foreign Worker Utilisation Plan an Indonesian employer must have approved before hiring a foreigner. It is a prerequisite for a foreign employee's work permit and work KITAS.Read definitionBPJSBPJS (Social Security)BPJS (Badan Penyelenggara Jaminan Sosial) is Indonesia's mandatory social security system, split into BPJS Kesehatan for health coverage and BPJS Ketenagakerjaan for employment benefits such as work-accident, old-age and pension programmes. Employers must enrol their employees and contribute monthly.Read definition
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General information, not legal or tax advice. Rules and rates change, so viskal confirms the specifics for your situation.
