SALARY EXPATS GUIDE IN INDONESIA FOR EUROPE

In this era of global free trade, the rise of foreign workers arrival may become a consequence. The majority of foreign workers in Indonesia as so called as expats sit at various important positions as they are, by regulation, required to turn in their expertise to Indonesia.  I figure out many expats I managed to take care, have well above treatment compared to local employees. Attractive salary, security system,   Facility houses,  children’s school allowance, cars, allowance to return home every year are to mention a few of their salary package.

After all, there is no absolute range of salary packages that universally applicable. Their salary package typically vary based on the following factors;  

1)      How long do you work for the company?

2)      What is your nationality

3)      How well is your skills set including  experience

4)      How crucial your current position is to the business interests in Indonesia

In practice, each company has its own standard salary on how much compensation should be given to employees pursuant to the ability of the company. I believe, this may certainly go above or perhaps below the standard.The current trend is the company performs fewer benefits by empowering a single status expat In Indonesia in order to have significant saving instead of hiring maried status with children.

REMEMBER THIS POINT

Well, what are important points to take into consideration when you got the possiblity of relocation to Indonesia either with   a potential employer or a potential assignment with a current employer. Here are the points:

ü  SALARY

Make sure, the salary basis might be 13 or 14 months per annum just to help reflect local practice in regards with THR (religious holiday allowance)

ü  PERSONAL INCOME TAX

Make sure you have read my earlier post pertaining to the personal income tax.

ü  HOUSING

In my records, if you are working for oil and gas industry, this facility are mostly provided. It’s a benefit in kind in the form of appartement or may be guest house.

ü  SCHOOLING

If you need to bring families here, you don’t have to worry about, Internatioan School in Indonesia are almost available everywhere in mostly Jakarta. but you may ask further details on school fee coverage as the fee is skyrocketing now.

ü  CARS

Make sure your employer pays all insurance, service and repair and also tax associated with it.

However, Most of company is in cooperation with leasing company to arrange this until its maintanance.

ü  HOUSEHOLD STAFF

If you have a driver, make sure, the wages is not borned by you, it’s often paid by employer, however using the driver for weekend or for your own personal business would beperhaps your personal expenses.

ü  UTILITIES ALOWANCE

Make sure it includes electricity, water, gas, phone, drinking water, security service, which is borned by company.

ü  HOME ANNUAL LEAVE

Make sure the number of annual leave, ticket for members of family is allowable for economy or business?

ü  MEDICALS

Make sure your medical insurance covers spouse and children, inpatoent and outpation as well as evacuation

ü  MOBILITATION ALLOWANCE

Make sure mobilization and demobilization flight for every rotation is provided by the company

ü  BUSINESS CLUB/ SPORTS CLUB

As percompany policy

ü  DOCUMENTS, EXIT/RE ENTRY PERMIT

This point is the most critical one for your legitimate. Make sure all the documentation including the renewal (KITAS, IMTA, etc) are well controlled.

TAX AUTHORITY

All the facilities and benefits received by Expats are often difficult for the company to find out how the actual real value of benefits which has received much less if not supported by a clear bookkeeping and administration. The difference of point of views between the company and the tax authorities on income received actually by an expatriate can trigger a tax dispute.

In many cases at foreign companies, there are some expats in certain positions do not receive a salary in Indonesia because he was paid at the central office. In other cases there are directors and commissioners listed on the deed, but never was in Indonesia and not getting salary from the office in Indonesia. This problem often arises as a tax dispute.

Standard guideline for remuneration of foreign workers is expected to be one of the bridges to unite opinion between the company and the tax authorities regarding the tax base for calculating the tax payable. These guidelines set the deemed salary received by foreign workers so hopefully no more disagreements between the company and the tax authorities

Director General of Taxation sets a standard salary for foreign workers as a guide in determining the reasonableness of the amount of salary paid to foreign workers. These guidelines set out in the decision of the Director General of Taxation No. KEP-173 / PJ. / 2002 dated 22 May 2002. These guidelines can be used as a reference for the company in determining the compensation granted to foreign workers.

SALARY THRESHOLD

Standard Guide for Expat Salary 
Per Month in USD

According to Director General of Taxation No. KEP-173 / PJ. / 2002

No	Type of Business	Position	USA	UK	Germany	Netherland	Australia	Other Europe
1	Trading	Manager other	13,958 11,012	10,884 6,018	10,180 6,018	9,988 5,506	10,756 5,506	9,988 5,506
2	Textile industry	GM Manager Technician	10,372 8,003 7,107	8,900 6,403 5,314	10,372 8,003 7,107	8,900 7,811 5,314	8,964 7,811 5,314	8,900 7,811 4,866
3	Other Industry	GM Manager Technician	12,165 9,284 7,363	10,692 8,900 5,762	12,165 9,284 7,619	18,375 16,390 5,762	10,564 8,900 5,762	10,692 8,900 5,762
4	General Mining/Non oil Drilling company	GM Superintendent Tool Pusher Crew	22,153 15,494 12,165 9,988	17,095 13,894 11,076 6,403	16,771 12,997 11,076 8,964	16,583 13,894 11,076 6,403	25,354 13,894 11,076 6,467	16,583 13,894 11,076 6,403
5	Agriculture	GM Manager Technician	10,372 8,067 7,107	8,900 7,811 5,314	8,900 8,067 7,299	10,372 7,811 6,403	8,900 7,811 5,314	8,900 7,811 4,994
6	Fishery	GM Manager Technician	11,589 8,964 7,619	9,988 8,579 5,762	11,461 8,964 7,619	9,988 8,515 5,890	9,988 8,579 5,762	9,988 8,515 5,890
7	Forestry	GM Manager Technician	12,357 9,284 7,363	10,564 8,900 5,762	12,293 9,284 7,363	10,692 8,900 5,762	10,564 8,900 5,762	10,692 6,403 5,762
8	Construction	GM Manager Technician Staff	18,375 11,461 9,988 6,595	12,869 11,973 9,284 4,994	13,253 12,165 9,284 3,906	11,973 8,900 8,067 4,994	11,973 8,900 8,067 3,970	11,973 8,900 8,067 3,970
9	Transport/Real Estate/ Leasing	GM Manager Technician Staff	13,765 11,268 8,387 2,689	13,253 11,268 8,387 6,595	13,253 11,268 8,387 7,299	13,253 11,268 8,387 6,595	13,253 9,412 8,259 6,595	13,253 11,268 8,387 4,994
10	Bank/ Insurance	Manager Staff	16,006 12,165	17,991 6,082	18,247 14,662	18,247 11,012	6,082 5,314	16,006 7,299
11	Others service	Manager Staff	12,165 9,988	8,900 4,802	8,900 6,018	8,900 4,994	8,900 4,802	8,900 4,866
12	Foreign consultant for govt project with foreign assistance fund	Manager Staff	24,010 13,958	19,976 17,991	19,976 17,991	- -	37,967 27,979	33,933 23,945

What about salary guide for Asian Expats? I will further reveal on the next post…. Keep stalking this blog as you will find my blog helpful ^-^…  

Happy weekend

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