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3.2. Practical Aspects of Tax Residence

The residency rule for a company established under the laws of Indonesia is very clear. However, there is no specific guidance on the potential Indonesian tax residence status of a foreign company established outside Indonesia but effectively managed in Indonesia.

In practice, only a company established under the laws of Indonesia is considered an Indonesian corporate tax resident. Technically, a foreign company that is effectively managed in Indonesia may be deemed as a resident of Indonesia for corporate tax purposes, however, no detailed regulations have been issued to date.