| Wednesday, February 19 2020 |
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 Q & A
Leasing Apartment in Jakarta Q & A
Leasing conditions vary in each country.
Below are some guides about apartment leasing in Jakarta.
- Types of accommodation
- Apartment with hotel-like services.
- Security Deposit.
- Taxes.
Click on the question link to make the answer part visible
Q1. What kind of apartments are available in Jakarta?
[x]
Basic Apartment
You can rent an apartment unit from an individual owner, or an apartment unit managed by the Building Management of the apartment. Either way, usually rental includes room rental charge, and service charges of the apartment. Payments and contracts are usually yearly based and paid in advance.
Service Apartment
Service Apartment usually provides hotel-like services such as housekeeping, breakfast, cable TV, and utilities included. It can be a bit costly, but convenient, as usually monthly or daily payment is possible.
Q2. Why is it yearly payment?
[x]
There are no rules that renting apartments should be yearly based, and yes it is negotiable.
Yearly payments and contracts are the common practice for renting properties in Indonesia. This ensures security of the contract for both parties. It is negotiable only when you have an appropriate reason, but basic apartments do not rent out for monthly payments. For high-class apartments, many starts only from 2 years contract paid in advance.
Q3. Why Security Deposit is still required, even after paying 1 year in advance?
[x]
Deposits are not to cover unpaid rent, but to cover unpaid utilities, damages and so on.
Usually, 1 month rent is charged for a Security Deposit, but there is no fix rule for that. Some may ask for telephone deposits. The policy for deposit differ from the management of the property.
Though, if you are renting from a private owner, it is most likely 1 month rent.
Check this before you make any deal.
Q4. What are the TAX Issues?
[x]
For every rental fee, there will be 10% income tax (withholding tax) for the apartment owner.
The owner must have a registered tax number. If not, the income tax will be 20%.
However, if the Lessee is a company, and it's paying on company cost, the liability to pay the owner's income tax is on the company.
Don't forget to double check this part before any negotiation.
Q5. My company pays me the rent including with my salary. Do I still have to pay tax?
[x]
Not necessarily.
In this case, it is a personal contract which is between the lessee and the owner. You do not need to report to the tax office, as it is the liability of the owner. The common practice is though, tax is not reported.
Q6. If in any case the company is paying, which is more cost saving?
[x]
Contract by the company are usually more cost saving.
It depends on the company policy, and the amount of the rental. Owner’s income tax is only 10%. In this case, it is a contract between the apartment and the company, usually signed by a representative of the company such as President Director.
However, if the company wishes to pay as a housing allowance included in the salary, salary tax are usually higher and may go up to 30%.
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