Expatriate Compensation Packages
There is no range of compensation that is applicable universally. Expatriate compensation packages typically vary based on:
1) Tenure with
3) Applicable skills and experience
4) How critical your position is to the company's interests in Indonesia
The general trend in recent years is for LESS benefits. Also, there is a trend amongst some companies to place single-status staff in Indonesia, with significantly lower expenses than staff that is married with children.
In discussing possible relocation to Indonesia with a potential employer, or a potential assignment in Indonesia with a current employer be sure that you discuss the companies policies on the following compensation issues:
Salary: usually stated in the currency the firm budgets in on a per month or per annum basis. Applicable Indonesian taxes are commonly paid by company. If you are working for a local company, the pay basis may be 13 or 14 months per annum to reflect the Indonesian practice of THR (Tunjangan Hari Raya - holiday bonus). Be sure to find out if the salary figure is net of Indonesian income taxes, or if your company assists expatriates employees in tax equalization issues. Many local companies have stopped paying expatriates in foreign currency-based packages or have opted for a mixed package with an amount in a foreign currency but the remaining amount in rupiah.
Personal income tax: the Indonesian government is now enforcing an 1984 regulation that all foreigners working in Indonesia for more than 183 days in a fiscal year must pay Indonesian individual income tax. The rate ranges from 5% of your first Rp 25 million in salary p.a. to 35% for amounts over Rp 200 million. Be sure that you are clear if your company will help you to obtain the NPWP (personal income tax number), and whether or not your salary is NET of Indonesian income taxes, or if your company will help you to file your yearly Indonesian tax return.
Be sure that you are clear with the tax authorities in your home country about possible double taxation exemptions or credits against your home country personal income tax. Be aware that this tax applies on your worldwide income, not just salary earned as a result of your work in Indonesia. If your company has foreign offices, you can always file a lien against their foreign holdings until they pay your taxes, if they renege on taxes and the taxman comes for you. This taxation holds true if you are in the country on a business visa (for more than 183 days) as well as an ITAS or ITAP.
Housing: company housing may be provided ... you simply choose from the available houses in company housing complexes. This happens most often with companies in the oil and gas industry. In most companies a housing allowance is given to expatriate employees and you must find a house or apartment you like within the rent allowance approved by the company. Bargain hard ... as housing prices decrease rapidly when the expat community shrinks during economic recessions!
Schooling: the single largest expense after salary and housing is usually education for your children. International schools in Jakarta are not cheap! Jakarta Intercultural School currently requires that each student have a non-refundable enrollment deposit of $1,500 and a Capital Fee which costs USD 4,000/student, which is in addition to the yearly tuition fees, which varies from over USD 23,150 to more than USD 31,650* depending upon the student's grade level. While other school may be less expensive, most of the more established international schools have similar fee ranges. When discussing schooling costs with your company, specifically ask if they cover the Capital Fee in addition to tuition, bus fees, and other school-required charges. If your children are still young, ask the company will cover the cost of pre-school. *(JIS fees stated are for 2014-2015 school year)
Cars: companies usually provide one car per family. For company cars, the employer pays all insurance, service and repair, registration, and tax costs associated with the vehicles. Gasoline, parking, tolls may be covered in full, or in part by a monthly allowance for running expenses. Some companies may prefer, instead of providing a company car, to lend the newly arrived expatriate money to buy a car or provide a car loan, or take advantage of car leasing plans which include maintenance.
Household staff: driver's wages (including or excluding overtime) are often paid by the company. This driver may be shared by the unemployed spouse for personal needs throughout the day, though the distance between home and office may make this difficult to schedule. Use of the driver for Saturday, Sunday and public holidays may be at personal expense. Your office may cover the expense of night/day watchman or other household staff.
Utilities allowance: could be offered in terms of a US$/rupiah allowance per month or the company may simply pay all your utility bills. Common utility bills covered in full, or in part, by the company include electricity, water, gas, telephone, hand phone, drinking water and neighborhood garbage and security services.
Home/annual leave: number of weeks per annum, as per company policy. Tickets for members of your family to point of hire or home town, once per annum. Ask if the company HR policy allows economy or business-class tickets. Alternately, some companies may give you a travel allowance equal to the cost of your tickets and you are free to use the amount for travel home, within Indonesia or in Asia.
Exit/re-entry permits and Individual Income Tax: paid by the company. May be a limit on the number of times these will be paid by the company in a given year.
Documentation: costs borne by the company for all documentation, including passport renewal, Work permit (IKTA); Temporary stay permit (ITAS); Police book (STMD); Population documents (SKTT & SKPPS) for the employee and all accompanying family members.
Medical: full medical insurance coverage (may include spouse and children). May include medical evacuation coverage for evacuation to Singapore, Australia (for eastern Indonesia) or your home country in an emergency. Most medical emergencies can be handled in Singapore.
Mobilization Allowance: the company pays the cost of shipment, by sea of allowed cubic meters of personal belongings. May include a small air shipment as well. The company pays custom costs and duties at both ends.
This are not given or standard perks; they are listed here so that you can ask questions and know your company's policies regarding these perks.
Good advice -- read the fine print of every contract and try to contact people who work there before you sign the employment contract.