How to Start an Airbnb Rental Business in Bali

Planning to start an Airbnb business in Bali? It remains a popular venture among foreign investors. However, you’ve likely noticed the government taking a much closer look into how property rentals operate– if you’ve spent any time on the island recently.

The Minister of Tourism Regulation No. 6/2025 now enforces stricter tourism standards and licensing for Airbnb operations in Bali. By the first quarter of 2026, Online Travel Agencies (OTAs) like Airbnb and Booking.com will delist any property that cannot provide a verified Business Identification Number (NIB) that aligns with their listing.

This guide explores Bali’s current rental property landscape. We’ll cover the latest regulations that govern rental operations, and how you can set up a compliant Airbnb business on the island.

An Overview of Rental Regulations in Bali in 2026

Today, the government uses the Online Single Submission (OSS) system as a digital filter. Authorities can now instantly cross-reference your Airbnb listing against spatial (zoning) and business records. If your property is found to be in a non-tourism zone or lacks the correct KBLI (business classification) code, the system can block your access to the marketplace until the OSS system confirms your credentials are valid.

For Airbnb operators, this translates to three key requirements:

• A lawful operating structure: Generally via a PT PMA (foreign-owned company); where you can obtain an accommodation service license.
• Land-use and zoning alignment: Ensuring the property is designated for tourism or commercial activity. A proper NIB/Business permit (villa/guesthouse/pondok wisata) for the accommodation must also be held by a local SME.
• Monthly Tax Compliance: Maintaining records that reflect your actual occupancy rates and rental income. Local tourism tax must be collected and reported every month.

Note that under the Minister of Tourism Regulation No. 6 of 2025, you may also risk sanctions and penalties without proper permits in place. This includes formal warnings, administrative fines, and even removal from OTAs like Airbnb and Booking.com by the March 31, 2026, deadline.

If you’re already operating an Airbnb business in Bali, Emerhub experts can validate your setup and secure all mandatory approvals to ensure you are fully compliant.

Types of Property Investments for Airbnb Rental Business in Bali

The Airbnb market in Bali spans everything from apartments to prefab homes and boutique hotels, but the private villa remains the most popular choice. Most travelers arrive on the island specifically seeking the lifestyle, rental arrangements, and amenities that a villa offers.

However, how you acquire a villa directly influences your time to market and overall compliance requirements. If you’re still weighing locations and investment strategies for your rental property, we cover those in detail in our Bali Property Investment Guide.

Here is an overview of the three most common routes for foreigners:

1. Building from Scratch: This gives you total creative freedom to build your villa. The catch is that you’re stepping into the highest level of oversight. You’ll need to navigate land zoning rules and construction moratoriums to ensure your project isn’t stalled by a sudden freeze on new builds in high-density areas.
2. Buying Ready-to-Move in/Resale Villas: This is the fastest route to market and remains the most common entry point for Airbnb investors. The critical step here isn’t just cosmetic upgrades, but a deep dive into the property’s infrastructure and paper trail. You’ll need to confirm that the villa’s existing approvals (especially the PBG and SLF) are valid and aligned with the villa’s current structure and use.
3. Buying Off-Plan: Off-plan villas are often priced below completed market value, which makes them attractive from a capital standpoint. However, that discount comes with a reliance on the developer’s compliance work. Before committing funds, you should confirm that the project already sits within tourism or commercial zoning that will allow you to operate your rental business.

Budgeting for an Airbnb Rental Property in Bali 

Listing prices rarely reflect what you’ll spend to acquire your rental property. Most investors end up budgeting 10%–25% above the advertised price once acquisition taxes, notary fees, permit checks, and first-year setup costs are included. Location also shapes your budget expectations. For instance:

1. USD 150,000–250,000 typically points to emerging areas in North or East Bali, where entry is lower but timelines and demand require patience.
2. USD 300,000–500,000+ reflects established rental areas in central locations such as Canggu, Pererenan, and Uluwatu, where stronger occupancy and clearer tourism zoning reduce uncertainty.

For a clearer breakdown of pricing, transaction costs, and buy-versus-build trade-offs, visit our guide to the Cost of Bali Properties today. You can also arrange a free consultation with our Bali-based advisors for more tailored insights.

Legal Requirements for Airbnb Rental Businesses in Bali

Maintaining an Airbnb listing in Bali today means transitioning from a casual host to a licensed operator. This requires a clear understanding of the regulatory landscape, from identifying the right legal structure to securing specific permits that formalize your Airbnb operations and optimize your tax obligations. 

Below are crucial requirements you’ll need to meet to ensure your compliance.

1. Ensure the Right Zoning Classification and Land Use Approvals

Bali’s zoning laws are strict and highly regulated. If your villa is in the wrong zone, no amount of paperwork will make it legal to run rental operations. This makes it crucial for you to ensure the property you’re interested in acquiring for your business is designated in the right zone.

There are six main categories of land zoning you’ll find: 

• Tourism Zone (Pink Zone): This is the primary zone where short-term, daily rentals are legally permitted and encouraged.
• Residential Zone (Yellow Zone): Designated for long-term residence. While daily rentals are generally restricted, some properties may allow for homestay operations under very specific local conditions.
• Commercial Zone (Red Zone): Reserved for large-scale business developments, shopping centers, and major hotels.
• Mixed-Use Zone (Orange Zone): A flexible classification that allows for a blend of residential and light commercial use.
• Agricultural Zone (Green Zone): Strictly protected land where building is prohibited. Construction here is high-risk and frequently results in demolition orders.

We strongly recommend building or buying within the Tourism Zone (Pink Zone). This classification offers the most direct path to obtaining the necessary building (PBG) and operational permits. While some Residential (Yellow) zones permit homestays, they often come with room-count limitations and are more vulnerable to changing local regulations.

2. Operate Under a PT PMA (Foreign-Owned Company)

Most daily accommodation services under current business categories (e.g, villa, homestay, and hotel KBLIs) are closed for foreign investment; they are reserved for local SMEs. 

As a result, foreign entities cannot hold these operational licenses directly. Instead, you must set up a PT PMA specifically as a Hotel Management Services company (KBLI 55900 for Jasa Manajemen Hotel).

This structure provides a compliant route that separates your asset control from the operational license. While the local landowner or a local entity holds the NIB (business license) under the Pondok Wisata or Villa KBLI, your PT PMA enters into a formal management agreement to operate the listing on the OTA. 

This allows you to legally hold the property lease or title and maintain full control over the asset’s management and revenue. The PT PMA essentially offers several advantages:

• Asset Control: You hold exclusive property rights (HGB or Hak Sewa) under a corporate name. This ensures your investment is recognized and protected by the state.
• Legal Revenue Streams: You can officially receive, report, and transfer rental income to your home country without legal friction.
• Tax Efficiency: You can deduct business expenses like villa maintenance, marketing, and staff salaries from your company’s taxable income.
• Residency Benefits: As a director or shareholder, you qualify for an investor KITAS, allowing you to live in Bali and oversee your operations personally.

One of the most significant advantages of the PT PMA is its flexibility regarding capital requirements. While your investment plan must eventually exceed IDR 10 billion, this is a realization target rather than an upfront cash injection. You only need to provide a paid-up capital of IDR 2.5 billion (~USD 150,000) to incorporate. 

Crucially, you can also satisfy the government’s capital requirements through your property acquisition, as well as its construction and operational costs.

3. Secure All the Mandatory Permits and Licenses

Once your PT PMA is set up, the next step is securing the permits that allow you, as a property management company, to operate legally as an Airbnb. Emerhub handles this end-to-end, from identifying the correct license structure to securing all building, environmental, and community approvals:

• Accommodation licenses: Airbnb properties must operate under either a commercial accommodation license (e.g. villa or lodging business) or a homestay (Pondok Wisata) license. Homestay licenses are limited to local ownership and capped at five rooms. Emerhub can secure the right licenses based on your property type and operating model.
• PBG (Building Approval): Confirms that the villa’s design, structure, and zoning are approved for accommodation use. This is an essential requirement for keeping your Airbnb listing active.
• SLF (Certificate of Worthiness): Certifies that the property is safe for guest occupancy. Without a valid SLF, you cannot legally host guests or insure the property.
• Environmental Approval (SPPL, UKL-UPL or AMDAL): A mandatory filing regarding your property’s waste and water management. It’s a prerequisite for a verified NIB and crucial for passing government audits.

Partner with Emerhub Bali for Your Airbnb Business

If you’re planning to operate an Airbnb rental in Bali, Emerhub can help you get started. From validating a property before purchase to aligning your tax obligations, you can trust in our experts on the ground to guide you through every step.

Our local team supports foreign investors with PT PMA setup, zoning checks, accommodation licensing, and the compliance steps needed to keep your listing active under Bali’s current rental regulations.

Ready to kickstart your Airbnb business in Bali? Let us know how we can assist you via the form below, and we’ll be in touch!