HOW TO CLOSE A COMPANY IN INDONESIA: THE COMPLETE 2025 GUIDE
If you’re a business owner in Indonesia thinking about shutting down operations, it’s vital to understand the proper legal pathways and your responsibilities. Whether you’re pausing temporarily or winding down for good, following the correct procedures helps avoid future complications, penalties, and unnecessary costs.
Indonesia offers two official routes for closing a business: Non-Effective (NE) Status and Total Closure. Each comes with distinct benefits, obligations, and long-term implications. Choosing the right approach depends on your current situation and future plans.
OPTION 1: NON-EFFECTIVE (NE) STATUS
The NE status is ideal for those who want to pause business operations without permanently dissolving the company. It allows the business to remain legally registered while suspending tax-related activities.
Benefits of NE Status:
No monthly or annual tax reporting obligations.
Legal entity remains active, allowing for easy reactivation later.
Flexible pause for restructuring, relocation, or market reassessment.
Compliance Obligation:
While the company is considered inactive for tax purposes, it is still required to submit LKPM (Investment Activity Reports) on a quarterly basis to comply with BKPM regulations.
Hepta Solutions can assist with LKPM submissions, ensuring your company remains compliant without hassle.
Who Should Consider NE Status?
Entrepreneurs assessing future opportunities
Investors who want to maintain licenses
Business owners waiting for market recovery
OPTION 2: TOTAL COMPANY CLOSURE
If you’re certain that your company will not resume operations in Indonesia, total closure offers a clean and permanent exit. It involves dissolving your company and removing it from all legal and tax records.
Benefits of Total Closure:
No further tax or LKPM reports are required.
Your company’s legal existence is terminated, eliminating all future obligations.
Required Steps:
Draft a Deed of Dissolution with a registered notary.
Publish a closure announcement in a national newspaper.
Submit a Tax ID closure application to the local tax office.
Complete a tax audit, which may take up to 12 months.
Once cleared, your company’s Tax Identification Number (TIN) is permanently deleted.
Considerations:
Irreversible: Once closed, the company cannot be reopened.
Time-intensive: The tax audit phase can cause delays—early preparation is crucial.
WHICH PATH IS RIGHT FOR YOU?
Deciding between Non-Effective Status and Total Closure depends on your short- and long-term plans:
If you may return to business in Indonesia: Choose NE Status.
If you want a final, clean break: Go for Total Closure.
Still unsure? We’re here to help.
WORK WITH HEPTA SOLUTIONS FOR A SMOOTH CLOSURE
Closing a company in Indonesia involves multiple steps, legal documents, and interactions with government institutions. At Hepta Solutions, we help you navigate the process, from choosing the right path to completing every detail with full compliance.
Whether you’re looking to temporarily pause with NE status or fully close down your PT PMA, our experienced team will guide you every step of the way.
Ready to close your company the right way?
Contact Hepta Solutions today for a free consultation. Let’s take care of the complexities, so you can move forward with confidence.