Indonesia Tax Treaty Countries: Full DTAA List and How to Claim Benefits

A tax treaty (also called a Double Tax Avoidance Agreement, or DTAA) is a bilateral agreement between Indonesia and a partner country that allocates taxing rights over the same income, so it is not taxed in full in both places. Indonesia currently has DTAAs with 71 countries, and as of December 30, 2025, the procedure for claiming treaty benefits changed under Minister of Finance Regulation No. 112 of 2025 (PMK 112/2025), which replaced the older PER-25/PJ/2018 framework and moved the entire process into Coretax. If you pay or receive cross-border income from Indonesia, this update matters more than the country list itself.

What Is a Tax Treaty and How Does It Prevent Double Taxation?

A tax treaty exists because Indonesian domestic law and a foreign investor’s home-country law can both claim the right to tax the same income. Under Article 26 of Indonesia’s Income Tax Law, payments to non-resident taxpayers, dividends, interest, royalties, and certain service fees, are subject to a final withholding tax of 20 percent of the gross amount. If the recipient’s home country also taxes that income, the combined burden can climb well past 30 percent before any treaty relief applies.

A DTAA fixes this in one of two ways: either the income is exempted in one of the two countries, or tax already paid in one country is credited against the liability in the other. Indonesia’s tax treaty framework generally follows a hybrid of the OECD and UN model conventions, adjusted to fit Indonesia’s position as both a capital-importing and capital-exporting country.

Which Countries Have a Tax Treaty with Indonesia?

Indonesia has DTAAs in force with 71 countries across Asia-Pacific, Europe, the Middle East, and the Americas. This is the official list as maintained by the Directorate General of Taxes (DJP):

Yes, the United States does have an active tax treaty with Indonesia, in force since 1991 and updated through a later protocol. So do Australia, Japan, Singapore, South Korea, and every other country listed above. If your country is not on this list, payments to or from Indonesia default to the standard domestic rates with no treaty relief available.

How Much Tax Can You Actually Save Under an Indonesia DTAA?

Without a treaty, dividends, interest, and royalties paid to non-residents are taxed at a flat 20 percent of the gross amount. Treaty rates vary by country and by the type of payment, and most treaties offer a lower rate for qualifying direct shareholders than for portfolio investors. Based on the DGT’s published rate schedule, here is how several major treaty partners compare:

The “qualifying” dividend rate usually requires the recipient to hold a minimum direct shareholding, commonly 20 to 25 percent, for a minimum period. Fall short of that threshold and the higher portfolio rate applies instead. This is exactly the kind of detail that gets missed when a treaty claim is filed without checking the specific article and footnote of the relevant treaty. Our guide to withholding tax in Indonesia breaks down how these rates interact with domestic obligations, and our dividend tax guide covers the shareholding and reinvestment conditions in more depth.

Who Qualifies for Tax Treaty Benefits in Indonesia?

Treaty benefits apply only to residents of a treaty partner country, and Indonesia checks this independently of how a transaction is labeled. An individual is treated as a tax resident of the foreign country, rather than Indonesia, as long as they have not stayed in Indonesia for more than 183 days within a 12-month period and have no documented intention to stay, such as a permanent stay permit or limited stay visa. For companies, residency turns on where management and control actually happen, not just where the entity is incorporated.

A holding company routed through a jurisdiction that has no treaty with Indonesia gets no treaty protection, no matter how the ownership chain is labeled. Under PMK 112/2025, beneficial ownership is no longer a separate formal checkbox, but the non-abuse declaration on the DGT Form still requires real economic substance: active operations, adequate staff and assets, and a transaction that was not structured primarily to access the treaty. Our guide to the Tax Residence Certificate in Indonesia covers how residency proof is documented in practice.

How Do You Get a Tax Treaty Benefit Applied in Indonesia?

Claiming a treaty rate is a documentation process, not an automatic entitlement. A foreign taxpayer (WPLN) submits a completed DGT Form to the Indonesian withholding agent before the payment is made. The form confirms the recipient is not an Indonesian domestic taxpayer, is a resident of the treaty partner country, and is not engaged in treaty abuse. It must be supported by a valid Certificate of Domicile (CoD) issued by the home country’s tax authority, or by the foreign competent authority’s signature on the form itself.

If the CoD does not state a validity period, it is treated as valid only for the month it was issued, a detail that trips up a lot of recurring cross-border payments. From January 2026 onward, the DGT Form follows the simplified six-section format introduced by PMK 112/2025, and the withholding agent is required to upload supporting documentation through Coretax before applying the reduced rate. Indonesian resident taxpayers earning foreign income follow a parallel process, applying for a CoD through Coretax, which is now valid until December 31 of the year it was issued. Our walkthrough on using tax treaties in Coretax covers each step of this filing in more detail.

Skip this step, or submit it late, and the rate defaults to 20 percent. There is no retroactive treaty relief just because a treaty technically existed.

What Mistakes Cause Foreign Taxpayers to Lose Treaty Benefits?

Most lost treaty claims in Indonesia come down to a handful of repeat issues:

Letting the Certificate of Domicile Lapse

A CoD without a stated validity period only covers the month it was issued. Companies that assume last year’s CoD still works for this year’s dividend payment are routinely denied the treaty rate.

Missing the Minimum Holding Period or Shareholding Threshold

Many treaties set a minimum direct shareholding, often 20 to 25 percent, and a minimum holding duration, sometimes 365 days, before the lower dividend rate applies. Falling short by even a few days pushes the transaction back to the higher portfolio rate.

Assuming One Treaty Covers Every Income Type

A DTAA is not a blanket exemption. Coverage and rates differ by category, dividends, interest, royalties, capital gains, business profits, and service fees are each governed by separate treaty articles, and some categories simply are not covered at all in certain treaties.

Routing Income Through a Non-Treaty Jurisdiction

Structuring payments through an intermediate entity in a country without a DTAA, hoping the final destination’s treaty applies anyway, is exactly what Indonesia’s anti-abuse rules and the principal purpose test are designed to catch. Our guide on tax avoidance in Indonesia explains how this kind of treaty shopping gets flagged.

Still Using the Old PER-25/PJ/2018 Form

The previous DGT Form format is no longer accepted for tax periods from January 2026 onward. Withholding agents that have not updated their templates risk the DGT rejecting the claim outright.

What Changed Under PMK 112/2025?

PMK 112/2025 took effect on December 30, 2025, and replaced the procedural framework previously set out in PER-25/PJ/2018 and PER-28/PJ/2018. The biggest practical shifts: the DGT Form moved from seven sections to six, the formal beneficial ownership test was folded into the broader non-abuse declaration, and all filings, both the DGT Form and the Indonesian CoD, now run through Coretax instead of the legacy DJP Online portal. The regulation also gives the DGT stronger authority to assess whether a foreign taxpayer’s Indonesian activities have, in substance, created a permanent establishment, closing a loophole where business functions were split across entities to dodge PE status.

Separately, Indonesia signed the OECD’s BEPS Multilateral Instrument back in 2017 and ratified it in 2019, and it has applied to roughly 60 of Indonesia’s existing treaties since August 2020. More recently, on September 19, 2024, Indonesia signed the newer Subject to Tax Rule Multilateral Instrument, a Pillar Two measure aimed at intragroup payments taxed below 9 percent abroad. Indonesia has provisionally flagged 29 treaties to be covered once that instrument is ratified domestically, though it had not yet entered into force as of this writing. Investors with material treaty-dependent cross-border flows should expect both instruments to keep reshaping specific treaty terms over the next few years.

If you need specific tax advice and detailed analysis, you can rely on InvestinAsia’s Indonesia tax consultant and compliance services. Our experienced team of professionals is ready to assist you in every tax matter, such as:

• Accounting and tax reporting services in Indonesia
• Indonesia Payroll Service
• Indonesia LKPM Reporting Service
• Indonesia VAT Taxpayers Registration

Frequently Asked Questions

How do you avoid double taxation in Indonesia?

You avoid double taxation by claiming relief under a Double Tax Avoidance Agreement, which either exempts the income in one country or credits tax already paid abroad against your Indonesian liability. This requires submitting a valid DGT Form with a current Certificate of Domicile before the income is paid, not after.

How do you get a tax treaty applied to your income?

You do not apply for a new treaty, since the treaty itself already exists between Indonesia and your country of residence. What you apply for is the benefit: submit a completed DGT Form, backed by a valid CoD, to the Indonesian withholding agent through Coretax before the payment date.

Is there a tax treaty between the United States and Indonesia?

Yes. The Indonesia-United States tax treaty has been in force since 1991, with later protocol revisions. It sets reduced withholding rates on dividends, interest, and royalties paid between the two countries, generally around 10 percent for qualifying payments instead of the standard 20 percent.

What are the most common treaty benefit mistakes?

The most frequent errors are letting the Certificate of Domicile expire, missing minimum shareholding or holding-period thresholds for reduced dividend rates, assuming one treaty covers every type of income, and continuing to use the outdated PER-25/PJ/2018 form after the January 2026 cutoff.

Who qualifies for tax treaty benefits in Indonesia?

Individuals and companies that are genuine tax residents of a treaty partner country qualify, provided they meet the residency tests under that country’s law and Indonesia’s anti-abuse criteria. A holding structure with no real economic substance, routed through a treaty country purely to access lower rates, does not qualify.

References

1. Directorate General of Taxes. (2026). Tax Treaty Rates. Retrieved from
https://www.pajak.go.id/en/tax-treaty-rates

2. Directorate General of Taxes. (2026). Tax Treaty. Retrieved from
https://pajak.go.id/id/tax-treaty

3. EY Indonesia. (2026). New Procedures for the Application of Double Taxation Agreements. Retrieved from
https://www.ey.com/content/dam/ey-unified-site/ey-com/en-id/technical/tax/documents/2026/eyid-tax-alert-new-procedures-for-the-application-of-double-taxation-agreements.pdf

4. PwC. (2026). Indonesia: Corporate – Other Issues. Retrieved from
https://taxsummaries.pwc.com/indonesia/corporate/other-issues