To live and work in Bali for longer than six months, you need a KITAS (Kartu Izin Tinggal Terbatas), Indonesia's limited stay permit. Most KITAS types need a local sponsor, though. If you do not run your own company in Indonesia and do not meet the income bar for a self-sponsored visa, you can struggle to qualify for anything at all.
This is the gap an Employer of Record (EOR) fills. The EOR is an established Indonesian company that becomes your legal employer and sponsors your Work KITAS, without the high income threshold of the digital nomad visa or the cost of setting up your own PT PMA.
You keep doing your actual job for your overseas employer or your own clients; the EOR simply holds the local employment and handles the local taxes & compliance.
This guide explains how an EOR sponsors a KITAS, who it works for, and what the process involves.
What is an Employer of Record (EOR)?
An Employer of Record (EOR) is a third-party organization that acts as the legal employer of workers in a specific country on behalf of another company.
In Bali, the EOR becomes your official employer and takes on all legal responsibilities tied to your employment. This includes:
- Employment contracts that comply with Indonesian labor law.
- Processing your monthly payroll and issuing payslips.
- Withholding and filing personal income tax (PPh 21).
- Managing mandatory social security contributions (BPJS Kesehatan and BPJS Ketenagakerjaan).
- Sponsoring your work permit and
Even though the EOR is your employer in legal terms, your daily work stays under your own direction. You carry on working for your overseas employer, serving your clients, or running your international business exactly as before.
Who Qualifies for a KITAS under an EOR?
An EOR works when your employer needs to sponsor your stay in Bali but has no local entity to do it. Because the EOR already runs a licensed Indonesian company with active quotas for hiring foreign workers, it can sponsor you through its existing structure.
Here are three of the most common scenarios:
Scenario 1: Remote Workers and Freelancers with Offshore Clients
Bali is a major hub for digital nomads and remote professionals. The legal paths for staying long-term depend on whether you are a salaried remote employee or a freelancer with international clients. Both groups have two main visa options:
- The E33G Remote Worker Visa (Digital Nomad Visa)
- The E23 Work KITAS (sponsored via an EOR).
a. The E33G Remote Worker Visa (Digital Nomad Visa)
The E33G Remote Worker Visa is a one-year residence permit designed specifically for foreigners who work online for offshore entities. It is a self-sponsored visa, meaning you do not need a local Indonesian company to apply on your behalf. The entry bar, however, is relatively high:
- You must show a remote employment or freelance contract with a company based outside Indonesia.
- You must prove an annual income of at least USD 60,000 through bank statements or salary slips.
- You are strictly prohibited from doing business with, or receiving any income from, local Indonesian clients or companies.
If you meet this income threshold and have a stable relationship with an offshore client or employer, the E33G is often the cleanest path.
b. The E23 Work KITAS via EOR
If you do not meet the USD 60,000 income threshold, or if your work requires a full local tax and payroll setup, you can opt for the E23 Work KITAS. An E23 visa always requires an Indonesian company to act as your sponsor. You have two ways to obtain the KITAS:
- Your Employer: The overseas company you work for already has a registered local office in Indonesia (such as a PT PMA). Therefore, they can sponsor your KITAS directly.
- An EOR Service: Your employer does not have a registered business in Indonesia, which means that they cannot sponsor you. They can, however, partner with an Employer of Record (EOR) service in Bali. The EOR then acts as your legal employer on paper, sponsors your E23 KITAS, and handles your local taxes and payroll, while you continue working for your offshore company as usual.
Scenario 2: Testing the Market Before Setting Up a PT PMA
A PT PMA (foreign-owned company) is the right structure if you're committed to building something substantial in Bali. But it is not suitable if you're still figuring out whether Bali will work for your business.
The capital requirement runs IDR 10 billion (around USD 650,000) in committed investment with IDR 2.5 billion (around USD 150,000) paid up. Setup takes one to three months, followed by quarterly LKPM reports, corporate tax filings, and physical office requirements.
An EOR lets you operate immediately without putting that capital on the table.
| Feature | PT PMA (Foreign-Owned Company) | Employer of Record (EOR) |
|---|---|---|
| Capital Requirement | IDR 10 Billion (~USD 650,000) capital plan, IDR 2.5 Billion (~USD 150,000) paid-up | None |
| Setup Timeline | 1 to 3 months, depending on business classification | 1 to 2 weeks |
| Ongoing Compliance | Corporate tax filings, audits, LKPM reports, local licensing | Handled entirely by the EOR |
| Best Suited For | Property development, retail, restaurants, hotels, large-scale projects | Tech talent, remote consultants, solo entrepreneurs, market testers |
| Visa Sponsorship | Investor KITAS (E28A) or Work KITAS | Work KITAS |
Once your operations grow past what an EOR can support, you can transition to a PT PMA later. Most companies that start with an EOR follow this route.
Scenario 3: Foreign Companies Hiring On-the-Ground Staff in Bali
Perhaps you run an overseas business and have discovered the highly skilled pool of developers, designers, and operational managers living in Bali. You want to hire them full-time, but you do not want to set up an Indonesian branch office just to pay three or four remote team members.
If you try to pay them as informal "contractors," you put both your business and your employees at risk. Indonesia is tightening its enforcement on tax compliance, and local workers who receive regular monthly wire transfers from offshore entities without clear local tax declarations can face audit flags.
Using an EOR solves this entirely. It compliantly hires Bali-based team members on local contracts, pays them in Indonesian Rupiah, contributes to their BPJS accounts, and withholds taxes at source. Your team gets local employment protections and a clean tax record. You get a compliant hiring structure without an Indonesian entity of your own.
What You Can and Cannot Do with a KITAS under an EOR
A Work KITAS sponsored by an EOR gives you full legal standing to live and work in Bali. It also comes with hard limits set by the Ministry of Manpower. Knowing where those limits sit keeps your KITAS valid and record clean.
| What You Can Do | What You Cannot Do |
|---|---|
| Work legally in Bali under your approved, registered job title. | Work for other local companies outside of your specific EOR employment contract. |
| Receive a tax-compliant salary in local or foreign currency. | Work in restricted roles like local Human Resources, entry-level administration, or local labor. |
| Open local bank accounts, sign long-term villa leases, and get local insurance. | Open a physical, brick-and-mortar retail shop under your personal name without a PT PMA. |
| Travel freely in and out of Indonesia using your multi-entry permit (MERP). | Buy commercial real estate or land under your personal name. |
| Sponsor your spouse and children for a Dependent KITAS. | Work without paying local taxes (your PPh 21 tax is managed automatically). |
KITAS Application Process in Bali under an Employer of Record (EOR)
When you partner with Emerhub to secure your KITAS, our local entity acts as your licensed Employer of Record in Bali to fast-track and streamline the process. Here is an overview of the step-by-step process when we handle your KITAS application:
Step 1: Pre-Assessment and Document Collection
Before submitting anything to the government, our team reviews your professional profile. Note that the Ministry of Manpower requires that your educational background and CV align with your proposed job title. We will gather and notarize your essential documents, including:
- A copy of your passport (valid for at least 18 months).
- Your university degree or highest educational certificate (translated into English or Indonesian).
- An updated CV and a work reference letter proving your expertise.
- A personal bank statement showing at least USD 2,000 to satisfy immigration entry requirements.
Step 2: The Ministry of Manpower Approval (Obtaining the RPTKA)
To hire a foreign worker, our local entity must submit an RPTKA (Rencana Penggunaan Tenaga Kerja Asing), which is a Foreign Worker Placement Plan. This document explains to the Ministry of Manpower why a foreign specialist is necessary for this specific role.
Once the RPTKA is approved, the mandatory Foreign Worker Utilization Compensation Fund (DKP-TKA) fee of USD 100 per month (totaling ~USD 1,200 for a 12-month visa) is paid directly to the state treasury.
Step 3: Visa Application (eVisa Issurance)
With the manpower approvals secured, we then submit your application to the Directorate General of Immigration to issue your electronic visa (eVisa E23). This step generally takes 10 to 15 business days. Once your eVisa is issued, you have 90 days to enter Indonesia.
Step 4: Arrival and KITAS Issuance
The eVisa from Step 3 is your entry document, not the KITAS itself. You’ll receive the KITAS once you arrive in Bali and complete biometrics at a local immigration office. We coordinate this directly with your local immigration office, including booking your appointment.
With your biometrics processed, you’ll receive the electronic KITAS (e-ITAS) and Multiple Entry Permit (MERP) via email, usually within 7 business days. Our team then handles your local compliance registrations:
- Setting up your tax number (NPWP)
- Registering you with the civil services (SKTT).
- Activating your local social security accounts (BPJS).
An Employer of Record offers a practical alternative to working or hiring staff in Bali without the administrative overhead. At Emerhub, we handle the entire immigration, payroll, and local tax compliance process through our local entity. We can also handle your ongoing compliance throughout your stay in Bali, including KITAS extensions or renewals.
If you are ready to set up your EOR arrangement or have questions about your specific situation, get in touch with our local team today and schedule a free consultation.
Frequently asked questions
Does holding an EOR-sponsored KITAS make me an Indonesian tax resident?
KITAS holders may be classified as Indonesian tax residents from the date of arrival, because the permit establishes the intent to reside. This applies regardless of the 183-day physical presence rule that normally governs non-permit holders. Under an EOR, this is managed for you. Your personal income tax (PPh 21) is withheld at source and paid directly to the tax office monthly. The EOR ensures you remain completely compliant with Indonesian laws.
Can a freelancer use an EOR without an active corporate sponsor?
Freelancers can use an EOR even without a separate company behind them. The EOR becomes your employer of record directly, hires you under a local contract, and sponsors your Working KITAS through its licensed entity. The arrangement requires a clear employment structure on paper. Your work and pay flow through the EOR rather than arriving as scattered freelance payments. Once that's set up, you can legally live in Bali, build your client base, and operate with a proper local tax record.
What happens to my KITAS if I lose my job or stop working with the EOR?
The KITAS is tied directly to the EOR as your sponsor, so your visa will be cancelled if your contract ends. The EOR will process an EPO (Exit Permit Only) with immigration, which formally terminates your visa and gives you a set period (usually 7 to 14 days) to leave the country or transition to another visa type without penalties.
Can I sponsor my family (spouse and children) to live with me in Bali on an EOR KITAS?
Once your E23 Working KITAS is active and approved, you can act as the primary sponsor for your spouse and dependent children under a Dependant KITAS. This allows your family to live in Bali, open bank accounts, and enroll in local schools. However, they will not be permitted to work locally unless they obtain their own independent work permits.