How to Live in Bali and Pay 0% Tax Legally

For a lot of online entrepreneurs, Bali's the dream, at least for the lifestyle. For tax, it's a different story. Indonesia taxes residents at up to 35% and you can become tax resident there without spending 183 days in the country, but that does not have to apply to you. With the right structure, there

is a legal way to pay close to 0% tax while living in Bali, but it doesn't work for everyone and there are some caveats, which is what I'll cover today. So, if you're a business owner or entrepreneur, here's how tax in Indonesia works and how you can live in Bali and pay close to 0% tax on your

business or online income. Currently, a lot of people in Bali don't worry about any of this. They assume Indonesia won't come after them and for a while, that was more or less true, but that's changing. This year, Indonesia set up a special task force in Bali to crack down on visas and tax is the obvious next

step. So, living there for a few years and hoping nobody notices isn't a plan, especially if you're a high earner. So, let's start with the tax rules. Bali is Indonesia for tax, so the national rules apply to you. Becoming tax resident in Indonesia is partly subjective and it can happen fast. The general rule is

more than 183 days in any 12 months, but you can be resident well before that. If you live there, meaning you have a home available there and your life is based there, that can be enough. And if you're there intending to stay, that counts, too. Indonesia's rules even list what counts as proof. A residence permit or

lease that lasts longer than 183 days. So, what does that mean for you? If you move to Bali on a long stay permit and signed a year's lease on a villa, you can be tax resident from the start, whether or not you have spent 183 days there. And once you're resident, Indonesia taxes your worldwide income.