Living in Indonesia

Topics: 
Visa and permits, Finding a Home, Buying a Car, Domestic Help, The Neighborhood, International Schools, Universities and Scholarships, Setting up your Bank Account, Tax, Learning Indonesian and understanding Indonesians
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Visas and Long Stay Permits
If you decide that Indonesia is the place to enjoy your retirement, or if you have work to do in Indonesia, make your preparations carefully. Indonesia is not an immigration country and the immigration requirements are complicated, cumbersome and costly.

One of the most important documents to arrange is the visa. Details of the admission requirements are available through the Indonesian embassies and consulates. 
You will need to demonstrate that you have a sponsor in the country (your employer, for example) and a regular source of income.
Over 57 year olds are offered the possibility to obtain an annually renewable visa with a validity of 5 years. 

A word of caution: don't enter the country on a tourist visa, expecting that it can be converted into a limited stay visa. You will risk to be deported!

With your first visa, the next step is to obtain a temporary stay (and work) permit. If you are going to work in Indonesia, usually your employer will arrange all the paperwork with the Home Department. 
But if you have to take care of the process yourself, be prepared that it is exhaustive and complicated. Professional help through one of the agencies, specializing in these kinds of activities is almost essential. 
Work permits, known as KITAS are valid for one year.

A new immigration bill now allows foreign spouses of Indonesian nationals to obtain a residence and work permit too.



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Finding a Home
Gradually more professional real estate agents and brokers set up shop in the major cities, such as Jakarta, Bandung and Surabaya and they will be happy to find you a house or an apartment. Newspapers, including the English language dailies carry advertisements for homes for rent.

The more regular way of renting a house is through local, usually unofficial agents. It is an accepted form of brokerage, but a word of caution is needed. Put all the promises the agent makes in a contract and have it legalized. 

The custom in Indonesia is to rent a house for one year, sometimes for two or three years. When the contract expires you are supposed to vacate the house. If you prefer to renew the rent it is best to put an option in the first contract. It should explain that you will have the right on renewal and that the broker is not allowed to offer the house to another interested party without your consent. Even so, bring up the subject with the broker well before the expiration date.

Brokers usually will be happy to make repairs during the first month after you move in. From then onwards you will be responsible to pay for all repairs, be it a broken water pump, a leaking roof, a collapsing wall and so on (almost all roofs in Indonesian houses leak, but walls usually remain firmly intact).

Buying property in Indonesia is fraught with regulations and limitations. Any great property offer should be viewed with suspicion. Very often foreigners are lured in shady contracts stipulating that the 'purchase' is in fact a lease.


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Buying a Car, Driver's License
The process of buying a car in Indonesia is not much different from that in other countries. Either you buy a secondhand vehicle directly from the owner or through a dealer or you buy a new car. Cars in Indonesia are relatively expensive as they are heavily taxed. 
The price difference between a new car and a second hand is not too significant. 

Buying the car is the easy part, the ensuing paperwork of renewing licenses, and paying taxes will cost you many unhappy hours. 
By far the best alternative is to use the services of the car dealer who will do the dirty work, known as balik nama (changing the owner's name) for you for a small surcharge. 
When you happen to move from one city to another the license plates of your car will need to be changed. In other words, your car needs to be re-registered in the new location and carry the local license plates. This process is known as mutasi (mutation) and is not very cheap. 
But, as always in Indonesia there are services available to do the work for you, such as standing in line and filling out forms. 

An important preparation before renting or buying a car is to ensure that you have a valid International Driver's License. When it expires you need to renew it abroad or obtain an Indonesian driver's license. 
The common procedure for the Indonesian license is to have an agency, or your office take care of the formalities. If you have time, you may do so yourself by contacting a police officer at the police station and to express that you would like to have a driver's license. 
Depending on who you have contacted the process may be cumbersome and long or quick and neat. In some cases you only need to show up to have your photo and fingerprint taken. Other essential documents to complete the process are your passport, visa and work permit.
Driver's licenses for foreigners are valid for one year only.



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Domestic Help
Living in Indonesia without domestic help is a contradiction in terms. 
Newly arriving expatriates sometimes are reluctant to contract a maid, a driver, guard or a gardener reasoning that domestic work exploits the local human resources. 
Reality is that unemployment in Indonesia remains a problem. Unemployment goes hand in hand with low levels of education. Therefore, hiring domestic staff definitely helps reduce the unemployment problem. 
The major part of the wages of your domestic helpers will most likely find their way to relatives in faraway villages where it helps to keep children in school, improve homes, pay for medical needs and help the relatives survive.

In several cities there are official employment agencies for domestic staff and you are required to pay at least the local minimum wages. Usually domestic help will be available for 24 hours and 7 days a week.
An alternative way to find staff is through recommendation from other expatriates, neighbors or co-workers.

Most domestic staff don't speak English. Patience and a sense of relativism and humor will go a long way in establishing a good working relationship. 
Whatever happens in your relationship with domestic staff, don't ever shout at them. Your staff will lose face and, just as important, they will appreciate you less and less, because with every emotional outburst you will be loosing face too. 
The test whether your staff are happy to work for you is when they return after the Idul Fitri break or stay away and never get in touch again, not even to collect their severance pay.

When the employment is terminated, whatever the reason, employers are required to pay severance to the amount of one month's wages for every year of employment.

Culture requires that employers also pay for their meals, soap, toothpaste, lodging and so on. Before Idulfitri employers provide a bonus of a additional month's salary, a new shirt and allow the staff to visit their relatives for at least one week (please pay for their transportation).


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The Indonesian Neighborhood
When you settle in and have unpacked all the boxes and the crates, it is time to get used to your domestic staff (and they to you) and to ensure that you register yourself and your family at several neighborhood levels.

During the Japanese occupation, the Japanese armed forces introduced different neighborhood levels. This system is still maintained. Starting from the bottom there is the RT (which stands for Rukun Tetangga). 

RT is a group of up to 100 households, headed by a leader, known as kepala RT, or more affectionately Pak RT. Pak is short for Bapak, which means both Father, Dad and Sir. Pak RT needs to know who is living in his RT and, in the case of foreigners, for how long. 
Shortly after arrival visit Pak RT, show your passport and explain who you are, why you live here, at which address and for how long. Pak RT usually also wants to know the names of your domestic staff. He will give you a simple note, signed and stamped. With this note you report to the next higher level, which is the RW (short for Rukun Warga). 

RW is composed of a number of RT and it is headed by the Kepala RW . At the RW level you will usually find an office with clerks. Instead of Pak RW, the clerks will do the processing. Once again you will receive a note, stamped and signed. You will need to pay a registration fee too. 
The note from the RW office is required to report to the Kecamatan or sub-district level. Here again you are charged a registration fee.

If your office is not equipped to do all the registration formalities, depending on the level of education of your domestic staff, they may do so at the RT and RW levels on your behalf, but you must personally fulfill the registration at the Kecamatan level.


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International Schools
In many cities you will find international schools. The most common are the schools with an American curriculum. But there are also British schools, Korean schools and Japanese schools and even a Dutch school (in Jakarta). Not all international schools provide classes until college level.

Most international schools are now called Intercultural schools.

A growing number of private Indonesian schools provide a curriculum that comes close to those of the international schools, such as Sekolah Internasional Ciputra in Surabaya. These schools are popularly known as "plus schools".
Teaching occurs in English and in Indonesian. These schools offer a viable (and economical) academic alternative. 
Go to the Links page for a list of international schools.


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Universities and Scholarships
It is possible for foreign students to study at an Indonesian university. All over the country there are hundreds of universities to choose from, some well known and many small and unknown. In our Links section we feature a list of the most popular universities.
Be prepared to come to the country with a scholarship.

There are very few opportunities to obtain a scholarship in Indonesia. The most popular is the Darmasiswa scholarship program, offered through the Department of Education. Darmasiswa is a non grade program to study at Indonesian universities and colleges. 
The program offers a choice of Indonesian languages (Indonesian, Javanese, Balinese, Sundanese), traditional dances, music, and singing, theater and shadow puppet play, photography and traditional crafts such as batik making. 



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Setting up your Bank Account
If you need to set up your bank account, you'll probably be dazzled by the number of banks in Indonesia. There are many domestic banks advertising their services. Very few seem to target expatriates, but an increasing number of banks provide US$ accounts.
All local banks have facilities for online banking.

In the major economic centers there are several international banks, such as, HSBC. More banks are on our Links page.
The process to open an account is very easy. All you need is your passport and your KITAS (stay permit) and a first deposit.

A drawback of the Indonesian banking system is that banks do not provide account statements.


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Tax Issues
There is no escape: foreign residents have to pay income tax if their stay in Indonesia exceeds 180 days.

Not all employers withhold all due taxes from your salary. Therefore, sit down with HR and have all the intricacies explained of Indonesia's tax system. Ensure that you receive proof of payment.

If you are self employed, you will have to make all arrangements with the tax office yourself or use the services of an agency, such as Okusi Associates.

The only foreign residents who are tax exempted are those holding a diplomatic visa or a service visa (Visa Dinas).


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Learning Indonesian and Understanding Indonesians
Anyone who stays in Indonesia for more than just a few weeks should make an effort to speak Indonesian. 
Most Indonesians, especially the younger generations will do their best to speak English. 

You may run into groups of youngsters who ask you lots of questions trying to practice their English. 
Nevertheless, most Indonesians only speak their local language plus Indonesian and nothing else.

If you make an effort to speak Indonesian, even if you don't master the complexities of the grammar, everyone will sincerely praise your mastery of the language and even help you to improve it. 
There are many language schools in Indonesia that offer courses for just a few weeks or up to two months. 
Most of those institutions are in the major cities in Java and in the island of Bali.

But learning the language is not all. Even if you speak Indonesian but don't understand the mindset of the people you will be in for many communication breakdowns. Investing in an inter-cultural program before you fly to Indonesia is a wise decision.

A language test in Bahasa Indonesia may be a prerequisite to obtain a work permit.

On the Links page you will find several options for language courses and links to inter-cultural programs.




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