Gifting a Bali villa or land to family: hibah, BPHTB and income tax

Indonesian owners of Bali land and villas often pass them to their children during their lifetime, and families with a foreign parent ask how. Three taxes are involved — the giver's transfer tax, the receiver's income tax and the receiver's acquisition tax — and they treat a lifetime gift and a bequest differently. This page reads the income tax law, the 2016 transfer-tax regulation, the 2024 tax administration regulation, the 2022 regional tax law and Badung's 2023 Perda.

Seven words in a family transfer

The terms in the regulations and the deed.

The three taxes, side by side

The giver: 2.5%, or an exemption certificate

The final tax on transferring land and buildings is 2.5% of the gross value; for a gift the value is market value (PP 34/2016 Pasal 2). Pasal 6(b) excludes an individual's gift of land or buildings to blood relatives in a straight line one degree, religious, educational and social bodies, cooperatives and micro and small businesses, if there is no business, work, ownership or control relationship. PMK 81/2024 Pasal 200(2) grants that exclusion by issuing a surat keterangan bebas — an exemption certificate — under a procedure set by the Director General. Without it, the PPAT's usual proof-of-payment rule applies.

The receiver: not income, but BPHTB

Gifts received by those relatives are excluded from income (UU PPh Pasal 4(3)(a)(2)); the Elucidation to Pasal 18(4) names them as father, mother and child. Acquiring land by gift is still a BPHTB object, on market value (UU 1/2022 Pasal 44, 46), due on the date the deed is signed (Pasal 49).

Gift now, or leave it by will?

Badung's Perda sets BPHTB at 5% with IDR 80 million untaxed on a first acquisition (Pasal 12(4), 13(1)). For a gift by will or inheritance to a parent, child or spouse, the untaxed amount is IDR 300 million and the rate is 0% (Pasal 12(5), 13(2)); the 2022 law sets the IDR 300 million floor nationally (UU 1/2022 Pasal 46(6)). An ordinary lifetime gift gets neither.

The transfer, step by step

1. Value. Market value is the base for both the 2.5% and BPHTB; if NJOP is higher, BPHTB uses NJOP (UU 1/2022 Pasal 46(3)). Valuation.
2. Exemption certificate. For a gift to a parent or child, the giver applies for the SKB under PMK 81/2024 Pasal 200, by the Director General's procedure.
3. BPHTB. The receiver pays it; the PPAT must ask for proof of BPHTB payment before signing (PP 35/2023 Pasal 60).
4. Deed and registration. The PPAT draws the gift deed, which the land office registers (PP 24/1997 Pasal 37).

Pasal 12(5) of the Perda reads “hibah wasiat atau waris atau yang diterima…”; read with Pasal 13(2) and the 2022 law, it covers gifts by will and inheritance, not lifetime gifts. Other regencies set their own rates. Inheritance and foreign heirs.

The deed, and who can receive

A transfer by gift can be registered only with a deed by a competent PPAT (PP 24/1997 Pasal 37(1)). Any gift meant to pass hak milik, directly or indirectly, to a foreigner or to an Indonesian who also holds a foreign citizenship is void and the land falls to the state (UUPA Pasal 26(2)); a dual citizen cannot hold hak milik (Pasal 21(4)). A family with a foreign parent can gift freehold to an Indonesian child once the child no longer holds dual citizenship. Mixed marriage and property.

What this page does not cover

• The Civil Code's rules on gifts, not available to us in an official copy.
• The DGT procedure for the exemption certificate.
• Other regencies' BPHTB rules.

Common questions