Legal Guide · 2026
How Foreigners Own Property in Indonesia
The PT PMA structure, HGB title, real costs and timeline — and the one structure you must avoid.
The PT PMA structure, HGB title, real costs and timeline — and the one structure you must avoid.
Not directly. Indonesian agrarian law reserves freehold land title (Hak Milik) for Indonesian citizens. But foreign nationals can own, rent out and profit from property — through the right legal vehicle.
There are two paths. One is sound and used by thousands of investors. The other is a trap.
The safe route: a PT PMA (foreign-owned Indonesian company) holding the property under HGB title. Full commercial and rental rights, legally enforceable.
The trap: a nominee arrangement, where an Indonesian citizen holds title "for you." It is legally unenforceable — there are documented cases of foreigners losing properties entirely. Never use it.
A PT PMA (Penanaman Modal Asing) is a limited liability company in Indonesia with foreign ownership. It can be 100% foreign-owned in the property/hospitality sector.
The PT PMA holds the property under HGB title (Hak Guna Bangunan) — a building-rights title granted for 30 years, renewable up to 80 years total under the Omnibus Law (Cipta Kerja).
Through the company you gain full rights to:
| Title | Who can hold it | Duration | Best for |
|---|---|---|---|
| Hak Milik (freehold) | Indonesian citizens only | Permanent | Not available to foreigners |
| HGB (building rights) | PT PMA (foreign-owned co.) | 30yr, to 80yr total | Investment / rental villas |
| Hak Pakai (right to use) | Foreign individual w/ KITAS | 30yr, renewable | Personal residence |
For an income-producing villa, HGB held by a PT PMA is the standard, commercially flexible choice.
Total cost: €5,000–8,000. Timeline: 3–5 weeks. Location: fully remote via power of attorney.
For rental villas, codes 55110 or 55194. This defines what the company can legally do.
Passport, proof of address, investment plan, and power of attorney to your local legal representative.
The Online Single Submission system (oss.go.id). Your legal partner handles the filing.
Business registration number (NIB) and tax ID (NPWP) — the company is now legally active.
Required for revenue collection and mandatory LKPM investment reporting.
Sign the PPJB, transfer HGB title to the PT PMA, and record it at the local land registry (BPN).
How much does a PT PMA cost to run each year?
Beyond the €5,000–8,000 setup, ongoing costs include accounting and tax filing, mandatory annual LKPM reporting, and corporate income tax (22% on net profit). Budget roughly €1,500–3,000/year for compliance depending on your provider.
Do I need to live in Indonesia to own a PT PMA?
No. Both incorporation and property purchase can be completed remotely through a power of attorney. Many owners visit only occasionally.
What happens when the HGB title expires?
HGB is renewed by administrative application to the land office (BPN). Total tenure can reach 80 years. Non-renewal of compliant, operating HGB properties has no historical precedent.
Is the PT PMA structure safe?
Yes — it is well-established Indonesian law used by thousands of foreign investors. The key safeguard is engaging independent legal counsel (not the developer's) to review every document.
2-bedroom off-plan villas with private infinity pool and ocean views. PT PMA setup guidance included in the purchase process.
From €255,000 · Only 2 villas remaining
This guide is for informational purposes only and does not constitute legal, tax or financial advice. Ownership structures in Indonesia depend on buyer profile and final legal documentation. Always consult qualified independent Indonesian legal professionals before proceeding.