Digital Nomads & Remote Workers in Bali | Guide & Tips

Living the Dream

It is the dream of many, to pack bags, and come to Bali in order to leave behind the old life and settle on this beautiful island. A dream, that thousands of self-employed digital nomads and remote workers have made come true in recent years. The digital nomad life style is attractive; “working online and living on a tropical island, getting paid to a bank account outside of Indonesia, not paying any taxes, having clients from all over the world.” There are several factors that give rise to the “digital nomad phenomena” in Bali. 

Bali is a favourite choice for Digital Nomads – for good reasons

Remote working for another company in general boomed because of the covid restrictions and more and more companies allow their workers, or even encourage them to work from “anywhere”. And studies show, that workers are very open to the idea of breaking the chains of an office job at home and would, at least for a few months per year, would consider to somewhere else. Furthermore, websites such as freelancer.com, guru.com and others, have made it much easier for freelancers to find jobs and handle projects, regardless of where they live. This lead to a rising number of “self-employed digital nomads” finally able to make a living and create a stable income. 

And then there is Bali as a destination – this magical island offers a very convincing and attractive package of tropical life style, quality of live, reasonable costs of living, vibrant communities, tolerance, and millions of things to do and explore.

Are you prepared?

Relocating to Indonesia (or any foreign country) and choosing the life as a self-employed digital nomad, is not that simple due to tax implications, visa regulations and medical insurance coverage. You will encounter enthusiastic individuals, “influencers”, communities, and dedicated websites & apps, who boldly promote the “digital nomad life” while naively or deliberately overlooking the details and potential traps that are still existing today. They make it seem, as if there are no laws to follow. That might work for a while, and for some, but this can turn into a nightmare rather quickly. 

Reliable International Medical Insurance for Nomads and Expats

The pandemic and the increasing popularity of freelancer websites gave rise to the digital nomad life style; working from anywhere online, getting paid to a bank account outside of Indonesia, not paying any taxes, having clients from all over the world. And there are many people in Bali who do just that. Technically, from the perspective of having a business visa, this is still a very “grey area “and Indonesia has been discussing to issue special visas for digital nomads, but there is nothing official yet.

What is clear is, with the visit visas that exist right now, you CANNOT work in Indonesia and make an income, particularly you cannot be paid in Indonesia or work with an Indonesian company as a client.

The “classic digital nomad”, works and lives in Indonesia on a tourist or business visa, offers freelance services but is not declaring any income, and also not having a legal structure (company and tax number) and has no working permit (Investor KITAS etc). Therefore he/she is at risk of violating quite a few regulations. Many nomads are not aware of that.

There are thousands in Bali who enjoy this lifestyle and make their money abroad while living here. And the authorities do not at this point or maybe cannot control this. They are also aware that regulations are not in place to provide a proper and reliable structure.
The least you can do, is to have a B211A Visa with business purpose and make sure, you don’t work for anybody in Indonesia and don’t receive money in Indonesia.

Then there is the remote worker who is employed officially abroad and also still works for that company while in Bali. They come to Bali for a staycation, and instead of being in a home-office they are in Bali. That’s less critical than being a self-employed digital nomad in relation to the visa status. And nobody can or does check wether these remote workers are on a long holiday or doing a sabbatical. But, also here, it’s a grey area and usually nobody gets into trouble.

Income tax liability – income in Indonesia and global income

A person’s liability for Indonesian tax is determined by their residence status. You become technically a resident in Indonesia if you stay in Indonesia for a total period of more than 183 days in any 12-month period. And that can have a big impact on your income liability, because

Residents are taxed on their global total income – regardless of where such income arises. The taxable income is like everywhere else in the world calculated after subtracting allowable deductions and personal allowances.

If you click on the button below you will be guided to an article from KPMG discussing these potential traps more in detail.