Investor KITAS 2023: Updated Rules for Obtaining an Investor Visa in Indonesia

As of August 2023, significant changes have come into effect in Indonesia concerning the limited stay permit for foreign investors — the Investor KITAS. These reforms, outlined in regulation PERMENKUMHAM No. 22/2023 by the Ministry of Law and Human Rights, aim to streamline the application process, increase transparency around requirements, and enhance the country's appeal for direct foreign investment.

This article covers all the updates affecting investors who wish to live and conduct business in Indonesia. We’ll also break down how the new regulations differ from the old ones, who they apply to, and how to best prepare.

What is the Investor KITAS?

The Investor KITAS (Kartu Izin Tinggal Terbatas for investors) is a temporary stay permit in Indonesia granted to foreign nationals investing in local companies. It is one of the most popular legal residency options for entrepreneurs and business owners.

Key benefits of this permit include:

• Legal residency for up to two years (with the option to renew);
• The right to manage a company in Indonesia without needing a separate work permit (IMTA);
• Official status as a tax resident if certain residency conditions are met.

What Changed in 2023?

Effective Date and Applicability

PERMENKUMHAM No. 22/2023 came into force on August 24, 2023. The new requirements apply to all applications submitted after this date. Investor KITAS already issued remain valid until their expiration, but renewals will follow the updated rules.

Key Reforms

• Clear investment requirements: Previously vague criteria are now standardized under national legislation.
• Simplified process: Fewer steps and documents are now required to obtain a KITAS.
• Flexibility: Investment thresholds may be adjusted periodically based on inflation or economic developments.

What Was the Old System?

Before the 2023 reforms:

• There was no clearly defined minimum personal capital contribution;
• Obtaining a 2-year visa was limited and typically required first extending a 1-year permit;
• The process was more complex, with greater bureaucratic involvement;
• There were loopholes involving fake or "shell" companies with no real investment.

Most of these issues have now been addressed.

What Are the Investment Requirements in 2023?

To obtain an Investor KITAS, one must invest in a foreign-owned company registered in Indonesia. The new rules specify both company-wide and individual investor minimums.

Minimum Investment Amounts:

• IDR 10 billion (approximately USD 650,000) — the minimum total capital of the target company (PMA);
• IDR 1 billion (approximately USD 65,000) — the minimum personal equity contribution by the foreign investor.

This means that even if the investor is not the sole shareholder, they must still prove a personal contribution of at least IDR 1 billion.

Ownership Format: Only via PT PMA

To apply for the investor visa, one must be a founder or shareholder in a company registered under the internationally recognized entity type:

• PT PMA (Penanaman Modal Asing) — a company with foreign shareholding, registered with Indonesia’s Investment Coordinating Board (BKPM);
• The investor must be officially registered as a shareholder in Indonesia’s Ministry of Law and Human Rights (AHU) system.

What Visa Options Are Available?

1-Year and 2-Year KITAS Options

As of the 2023 update, there are two primary types of investor visas:

• Class C313: 1-year investor visa — renewable annually (up to 5 years total);
• Class C314: 2-year investor visa — granted immediately if minimum investment requirements are met, without needing an initial 1-year “trial.”

What Has Improved?

Previously, the 2-year visa was mainly accessible to high-level investors with large portfolios or connections. Now, the application process and criteria are more transparent, and any investor meeting the required minimums may qualify for long-term residency.

Step-by-Step Application Process for Investor KITAS

The updated procedure is faster and more standardized. General steps include:

1. Establish or join a PT PMA with the registered minimum capital;
2. Register the investor’s shareholding via AHU;
3. Apply for the e-VISA type C313 or C314 via the official platform visa-online.imigration.go.id;
4. Upon receipt of the e-VISA, travel to Indonesia and activate the KITAS at a local immigration office within 30 days;
5. Obtain a tax identification number (NPWP) and register with the tax office (if required).

Processing time: between 4 to 8 weeks, depending on the region and agency workload.

Taxation: Obligations for KITAS Holders

When Do You Become a Tax Resident?

Foreign investors are automatically classified as tax residents if they stay in Indonesia for more than 183 days per year.

What Taxes Must Be Paid?

• NPWP: must obtain a personal tax identification number;
• PPh Orang Pribadi (Personal Income Tax): paid annually under a progressive tax scale;
• File tax returns via the DJP Online system.

Failure to comply with tax regulations can result in KITAS cancellation and penalties. It's crucial to consult with licensed tax professionals.

Frequently Asked Questions (FAQ)

Do I need to start my own company to get an Investor KITAS?

No, you may join an existing PT PMA as a shareholder, provided you meet the investment and ownership requirements.

Is Investor KITAS suitable for freelancers or remote workers?

No. This visa is intended for active investors — owners or co-owners of companies in Indonesia. For remote work, consider other options like the Second Home visa or a digital nomad visa (if formally introduced).

What happens if I don't meet the investment conditions after applying?

If non-compliance is discovered during checks, your KITAS may not be renewed or could be revoked. It’s essential to fulfill your declared investment commitments.

Conclusion

The 2023 reform of the Investor KITAS marks a significant move toward transparency and sustainable foreign investment in Indonesia. For legitimate business investors, the new system offers:

• Faster and easier access to 1- or 2-year visas;
• Clear investment standards with no ambiguous “grey zones”;
• Greater confidence in legal protection when operating above board.

However, obtaining a stay permit requires careful preparation: proper company registration, share structuring, and understanding tax responsibilities. Legal advisors and licensed agents are highly recommended to avoid pitfalls.

Important: Regulations may evolve, and enforcement practices are still being defined. Always follow updates from BKPM and immigration authorities.