Home Blog Starting a Business in Bali the Right Way without These 5 Mistakes Bali | Business Setup | Indonesia Starting a Business in Bali the Right Way without These 5 Mistakes InCorp Editorial Team 8 August 2023 4 minutes reading time Table of Contents Avoid Making These 5 Mistakes when Starting a Business in Bali How InCorp can be of Assistance The tropical climate, natural forests, sunshine beaches, and laid-back lifestyle are among the things that make Bali a paradise for entrepreneurs interested in starting a business on the island. Known as the Island of God in Indonesia, Bali has shown a rapid increase in the number of tourists and foreign startups. Driven entrepreneurs strike out on their own to turn their ideas into reality by launching their dreams on this beautiful island. However, not everyone who has come here can make their dreams come true. It’s not about Bali itself, it’s about the mistakes that most entrepreneurs commit when new to the scene. Therefore, in this article, we have prepared a list of mistakes you should avoid if you want to have a long and successful business in Bali. Avoid Making These 5 Mistakes when Starting a Business in Bali 1. Register a New Company without a Business Plan Many entrepreneurs want to build a business in Bali without a business plan. A business plan is critical because it clearly states your business activities and classification (KBLI) before you proceed with the company registration. Without a refined business plan, you risk paying significant amounts for changing licenses, which may cost the same as a new company registration. 2. Work without a KITAS One of the most common mistakes new entrepreneurs commit in Bali is working illegally. In other words, you work without a work visa and stay permit or KITAS from the Ministry of Manpower. The process of acquiring a KITAS can be challenging due to the change in regulations and foreigners’ unfamiliarity with the laws. Working illegally without a KITAS can make you lose your business, get fined, or even get deported from Indonesia. A consultation with a visa specialist is highly recommended before application. 3. Engage in an Unsafe Special Purpose Vehicle Arrangement Using professional shareholder/director/commissioner services (make Special Purpose Vehicle arrangements) with family or friends can be extremely risky when you start your business in Bali. You may lose total control of your company with such an unofficial structure. Special Purpose Agreements can benefit your business only when you do it properly through a licensed firm. A licensed firm can ensure that you have a legit agreement under Indonesian Laws. Read more: A Complete Guide to Registering a Company as Foreigners 4. Use an Unqualified Company Registration Service Provider In the business world, it is vital to understand who you’re dealing with when it comes to working together. New entrepreneurs in Bali are often more susceptible to falling into the trap of unprofessional agents who claim to be able to help them with company registration. More than often, these deceitful agents do not know the current legislation and do not know the difference between various legal entities foreigners can choose from. So, you must find a company registration agent with whom you have gone through proper checks and research to guide you in choosing the most profitable business in Bali. 5. Lease Property without Due Diligence Before leasing a property for your business in Bali, it is highly recommended that you hire a professional to perform the due diligence – to check all property documentation to ensure they comply with Indonesian legal requirements. For instance, your building permit (IMB) must be the kind that is appropriate for your company registration in Bali. How InCorp can be of Assistance InCorp is a business consulting firm dedicated to assisting entrepreneurs in building competitive and sustainable companies, giving startups the highest probability of long-term success in Bali. We have the tools and resources needed to start your new endeavors with your startups in the shortest period of time Furthermore, with years of professional experience assisting businesses of diverse industries, our experts at InCorp Indonesia can help you run a successful business and guide you on an experiential journey toward sustainable business growth. We fully support company registration and other business solutions for various sectors. For full information on establishing a thriving company in Bali, please contact us through the form below. Read Full Bio Verified by David Susandi Branch Manager – Bali Office at InCorp Indonesia Holding 11 years of experience in various roles, including project manager, operational manager, and corporate strategist, David Susandi is a prominent figure for many entrepreneurial organizations expanding in Indonesia. Frequently Asked Questions Can a PMA company hire expats in Indonesia? Yes, PMA companies in Indonesia can hire expatriates, but certain positions are restricted by the Ministry of Manpower. Expatriates need both working and stay permits, and employers must employ Indonesian counterparts for each expatriate employee, typically at a ratio of at least one Indonesian counterpart per expatriate. Can a foreigner become a director or commissioner of a company in Indonesia? Yes, in a foreign-owned (PT PMA) company, a foreigner can be a director or a commissioner What is the Indonesian employment status in PMA company? In Indonesia, employment arrangements are categorized into temporary employment agreements (PKWT) and permanent employment agreements (PKWTT). Temporary contracts are for short-term, seasonal, or experimental work, while permanent contracts are for continuous employment. How much is the minimum fund required to establish a PT PMA business in Indonesia? The investment requirement for PMA companies in Indonesia varies based on their classification under the Indonesia Industrial Standard Classification (KBLI). Generally, a minimum investment of IDR 10,000,000,000 (ten billion Indonesian Rupiah), excluding investment in land and buildings, is needed to conduct one business activity in one location. Get in touch with us. Lead Form Contact Full NameEmailPlease provide corporate email where possiblePhone NumberOffice SetupWhich city are you planning to expand into?JakartaSemarang/Central JavaBali/LombokBatam/SumateraSurabaya/East JavaOther ProvincesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Package (20% OFF)[SPECIAL PACKAGE] Product Registration + License Holder (20% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Service (20% OFF)[SPECIAL PACKAGE] Comprehensive Industrial Package (15% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Service (20% OFF)[SPECIAL PACKAGE] Comprehensive Industrial Package (15% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration (25% OFF) + Office Space (Private Office 30% OFF)[SPECIAL PACKAGE] Company Registration + Investor KITAS (25% OFF)[SPECIAL PACKAGE] Accounting + Tax Services+ Annual Fintax Report (20% OFF)[SPECIAL PACKAGE] Payroll Services for Executive Role (20% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration (20% OFF) + Office Service (25% OFF)[SPECIAL PACKAGE] Company Registration + Micro Finance Services (25% OFF)[SPECIAL PACKAGE] Property Assistance: Due Diligence + AJB Purchase/Lease Agreement (25% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesServices Company Registration Renting Virtual and Serviced Office Business and Import Licenses Corporate Recovery and Insolvency Closing of Company (Dissolution) Land and Property Ownership Shelf Company Local NomineeServices Accounting and Tax Reporting Audit and Review Transfer Pricing Compliance Tax RefundHuman Resource Sub Services Payroll Outsourcing Employer of Record Recruitment and HR Establishment Employment ServiceServices Business Visa Work Permit and KITAS Dependent Visa (Spouse and Family) OtherBusiness Visa Subservices Business Visa Visit Visa Visa ExtensionServices Medical Device Beauty (Skincare and Cosmetic) Food and Beverage Health Supplement Household Product Halal Certification TrademarkServices Legal Consultation Legal Agreement Service Due Diligence and Background Check Company Documents RevisionBusiness Advisory Business Advisory Services ESG Reporting & Advisory Internal Audit Risk ManagementMore Services Market Research and Analysis Local Distributor and Partner Bank AccountMessageSubmit What you’ll get A prompt response to your inquiry Knowledge for doing business from local experts Ongoing support for your business Disclaimer The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind. We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials. We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website. More on Bali New Retirement Age in Indonesia: What Businesses Should Do Next Read more Indonesia’s Geothermal Energy: A 2025 Investment Guide Read more Top 17 Foreign-Owned Businesses in Indonesia Read more