Indonesia Outsourcing

Outsource to Indonesia: Hiring Software Engineers in Indonesia

Grow your technology team with confidence by tapping into Indonesia's thriving talent pool through Hyperion360. Our Global Staffing & Team Extension Services ensure seamless, efficient, and cost-effective international expansion and outsourcing.

Already found qualified software engineers or other talent to work with in Indonesia? Hyperion360 can be your Employer of Record (EOR) in Indonesia. Hyperion360 helps you pay your team members anywhere in the world. If we don't have a local entity in a particular country we have a vast network of payroll partners who can help allowing you to hire top talent almost anywhere in the world. Need help finding software engineers? Contact us.


Indonesia Hyperion360 Talent Score

Ease of Hiring Developers in Indonesia
Cost of Doing Business in Indonesia
English Proficiency in Indonesia
US-Timezone Overlap with Indonesia
Technical Skills in Indonesia
Internet Reliability in Indonesia
Retention Rate in Indonesia
University Quality in Indonesia
Quality of Life in Indonesia
Political & Economic Stability in Indonesia

The Hyperion360 Talent Score for Indonesia is determined by evaluating and averaging several key factors that influence the attractiveness and viability of hiring software engineers in the country. These factors are assessed on a scale from 1 to 10, where 10 represents the highest performance or most favorable conditions.

Table of Contents

Hiring Software Engineers in Indonesia

Key Facts About Hiring Software Engineers in Indonesia

  • Large Talent Pool: Indonesia offers a vast and growing pool of skilled software developers. With a population of over 270 million, the country is rapidly increasing its number of IT professionals.
  • Cost-Effective: The cost of hiring software engineers in Indonesia is competitive, providing excellent value for high-quality talent.
  • Quality of Work: Indonesia has made significant investments in its IT sector, resulting in a highly skilled and reliable workforce.
  • Time Zone: Indonesia operates in time zones that align well with many countries in Asia and Australia, facilitating real-time collaboration.
  • Language: While Bahasa Indonesia is the official language, English proficiency among IT professionals is generally good, easing communication barriers.
  • Ease of Doing Business: Indonesia is ranked 73rd in ease of doing business, with a continuously improving regulatory environment for IT investments.
  • Innovative Tech Scene: Indonesia has a burgeoning startup ecosystem, supported by government initiatives and a growing venture capital presence.
  • Software Market Revenue: The Indonesian software market has shown robust growth, generating significant revenue and expanding rapidly.
  • Number of IT Companies: Indonesia is home to numerous IT companies, from small startups to large multinational corporations.
  • Internet Infrastructure: Indonesia boasts a well-developed internet infrastructure with a high penetration rate. Major cities like Jakarta, Surabaya, and Bandung have robust broadband connectivity, supporting the needs of tech companies and remote work.
  • Universities and Education: Indonesia’s top universities, such as Universitas Indonesia (UI), Institut Teknologi Bandung (ITB), and Universitas Gadjah Mada (UGM), offer highly regarded computer science and engineering programs. These institutions are known for their rigorous curriculum, research output, and strong ties with the tech industry, producing graduates who are well-prepared for the demands of the global IT market.

Benefits of Hiring Software Engineers in Indonesia

  • Exceptional Technical Proficiency: Indonesian software engineers are known for their strong technical skills and problem-solving abilities, excelling in programming languages such as Java, C#, JavaScript, Python, and PHP.
  • Culture of Innovation and Creativity: Indonesia’s vibrant startup culture fosters innovation and creativity, positioning it as a leader in Southeast Asia’s tech landscape.
  • Cost-Effective Talent: Hiring software engineers in Indonesia offers high value due to the combination of advanced technical education, good English proficiency, and competitive costs.
  • Flexible Hiring Options: Hyperion360 provides various hiring options, including direct hiring through us or establishing a foreign entity in Indonesia with the assistance of our legal partners.
  • Thriving Tech Scene: Indonesia’s tech ecosystem is filled with innovative startups and seasoned professionals, creating a fertile ground for collaboration and growth.

Benefits of Outsourcing to Indonesia

Indonesia is Southeast Asia’s largest economy and one of the region’s fastest-growing markets, offering numerous advantages:

  • A Robust Market: Indonesia’s diverse economy includes strong sectors in agriculture, services, and technology, contributing to rapid economic growth.
  • Strategic Trade Access: As a member of the ASEAN Free Trade Area, Indonesia offers access to key Southeast Asian markets and benefits from regional trade agreements.
  • Advanced Infrastructure: Indonesia has well-developed infrastructure, including extensive road networks, railways, and ports, supporting efficient business operations.

Common Pitfalls of Hiring Software Engineers in Indonesia

While Indonesia offers many benefits, there are some challenges:

  • Economic Fluctuations: Indonesia’s economy, while growing, can experience fluctuations. Hyperion360 helps manage financial and legal aspects to mitigate these risks.
  • Complex Tax System: Navigating Indonesia’s tax system can be intricate. Hyperion360 handles all tax-related matters, ensuring compliance and ease.
  • Government Regulations: Adhering to local regulations can be challenging. Hyperion360’s expertise ensures you stay compliant with all legal requirements.
  • Talent Competition: High demand for skilled engineers leads to competition. Hyperion360’s extensive network and staffing solutions help you secure top talent quickly and efficiently.
  • Cultural Differences: Understanding and adapting to Indonesian business culture is crucial. Hyperion360’s team extension services bridge these gaps, ensuring smooth cultural integration and effective communication.

Hyperion360’s tailored solutions address these challenges, enabling you to successfully hire and manage software engineers in Indonesia with confidence and ease.

Business Etiquette in Indonesia

Understanding cultural nuances is vital for successful business interactions in Indonesia. Here’s a detailed guide to help you navigate these intricacies effectively:


  • Handshakes: A handshake accompanied by a slight bow is a common greeting in business settings. It is polite to greet everyone individually when arriving and leaving.
  • Using Titles: Indonesians value respect and formality. Addressing people by their titles and surnames is common practice.

Communication Style

  • Indirect Communication: Indonesians often communicate indirectly to avoid confrontation. Understanding subtle cues is important.
  • Respect and Politeness: Showing respect and maintaining politeness is crucial in all interactions.

Timekeeping and Punctuality

  • Punctuality: While punctuality is appreciated, meetings may start late. Patience is valued, and flexibility is often required.
  • Networking: Small talk at the beginning of meetings is common to build rapport and trust.

Value on Relationships

  • Personal Connections: Building strong personal relationships is essential. Trust and rapport are crucial for successful business dealings.
  • Hierarchical Structure: Business structures are often hierarchical. Respect for seniority and titles is important.

Business Meetings

  • Small Talk: Meetings often start with informal conversation to build relationships.
  • Networking Focus: Use meetings to strengthen relationships as well as discuss business matters.

By understanding and respecting these cultural nuances, you can foster better relationships and ensure successful business interactions in Indonesia. Hyperion360’s tailored solutions help you navigate these cultural intricacies with ease, enabling seamless integration and collaboration with your Indonesian team.

Employment Agreements

In Indonesia, while not mandatory, written employment agreements are strongly recommended to outline key conditions clearly. Essential elements to include are:

  • Remuneration: Specify salary and any additional compensation.
  • Job Description: Outline roles, responsibilities, and expectations.
  • Working Hours: Define standard working hours and any flexibility.
  • Place of Work: Mention the primary workplace and any remote work possibilities.
  • Probationary Period: State the duration and conditions of the probation.
  • Contract Type: Indicate whether the contract is fixed-term or indefinite-term.
  • Company Policies: Include relevant workplace policies and guidelines.
  • Travel and Transfers: Detail the conditions and possibilities for travel or relocation.

Some terms are automatically recognized under Indonesian law, such as:

  • The minimum wage
  • Annual leave entitlement and vacation bonus
  • 13th-month salary
  • Social Security payment requirements
  • Benefits provided by collective bargaining agreements

Probationary Periods in Indonesia

The maximum probationary period in Indonesia is three months. This allows employers to assess the suitability of the software engineer within a defined timeframe.

Indonesia Payroll Laws

Tax Due Date

Individual taxes in Indonesia are due by March 31, following the calendar year for the tax period.

Payroll Cycle

The payroll cycle in Indonesia is generally monthly.

Working Hours

Standard working hours are eight hours per day and 40 hours per week.

Minimum Wage and Salaries

As of 2024, the minimum wage in Indonesia varies by region, with Jakarta having one of the highest at IDR 5,067,381 per month.

Bonus Payments

Indonesian labor law requires a religious holiday allowance, often referred to as the 13th-month salary, typically paid before major religious holidays.


Overtime is compensated at 150% of the regular hourly wage, and at 200% on public holidays and weekends.

Taxes and Social Security in Indonesia

Tax Thresholds in Indonesia

In Indonesia, individuals are considered tax residents if they stay in the country for more than 183 days in a calendar year. Tax residents are subject to tax on their worldwide income.

As of 2024, the Indonesian income tax brackets are as follows:

  • Up to 5.4M IDR: 0.00%
  • 5.4M – 5.65M IDR: 0.25%
  • 5.65M – 5.95M IDR: 0.50%
  • 5.95M – 6.3M IDR: 0.75%
  • 6.3M – 6.75M IDR: 1.00%
  • 6.75M – 7.5M IDR: 1.25%
  • 7.5M – 8.55M IDR: 1.50%
  • 8.55M – 9.65M IDR: 1.75%
  • 9.65M – 10.05M IDR: 2.00%
  • 10.05M – 10.35M IDR: 2.25%
  • 10.35M – 10.7M IDR: 2.50%
  • 10.7M – 11.05M IDR: 3.00%
  • 11.05M – 11.6M IDR: 3.50%
  • 11.6M – 12.5M IDR: 4.00%
  • 12.5M – 13.75M IDR: 5.00%
  • 13.75M – 15.1M IDR: 6.00%
  • 15.1M – 16.95M IDR: 7.00%
  • 16.95M – 19.75M IDR: 8.00%
  • 19.75M – 24.15M IDR: 9.00%
  • 24.15M – 26.45M IDR: 10.00%
  • 26.45M – 28M IDR: 11.00%
  • 28M – 30.05M IDR: 12.00%
  • 30.05M – 32.4M IDR: 13.00%
  • 32.4M – 35.4M IDR: 14.00%
  • 35.4M – 39.1M IDR: 15.00%
  • 39.1M – 43.85M IDR: 16.00%
  • 43.85M – 47.8M IDR: 17.00%
  • 47.8M – 51.4M IDR: 18.00%
  • 51.4M – 56.3M IDR: 19.00%
  • 56.3M – 62.2M IDR: 20.00%
  • 62.2M – 68.6M IDR: 21.00%
  • 68.6M – 77.5M IDR: 22.00%
  • 77.5M – 89M IDR: 23.00%
  • 89M – 103M IDR: 24.00%
  • 103M – 125M IDR: 25.00%
  • 125M – 157M IDR: 26.00%
  • 157M – 206M IDR: 27.00%
  • 206M – 337M IDR: 28.00%
  • 337M – 454M IDR: 29.00%
  • 454M – 550M IDR: 30.00%
  • 550M – 695M IDR: 31.00%
  • 695M – 910M IDR: 32.00%
  • 910M – 1400M IDR: 33.00%
  • 1400M IDR and above: 34.00%

Non-residents are taxed at a flat rate of 20%.

The income tax rates presented above are relevant for category A citizens (single with zero or one dependent or married with no dependents). The tax rates might be lower depending on marital status and the number of dependents.

Every December, the annual tax is calculated and compared with the cumulative monthly tax payments submitted to the government.

Corporate Tax Rate in Indonesia

As of 2024, the corporate tax rate in Indonesia is:

  • General Corporate Income: 22%

Social Security Rates in Indonesia

In 2024, the social security rates for employees and employers are as follows:

Employer Payroll Contributions in Indonesia

Employers in Indonesia are responsible for several additional payroll contributions, which include:

  • Work Accident (JKK): 0.24% – 1.74% of the employee’s salary
  • Old Age Benefit (JHT): 3.70% of the employee’s salary
  • Death/Life Insurance (JKM): 0.30% of the employee’s salary
  • Pension (JP): 2.00% of the employee’s salary (applied on salary up to 10,042,300 IDR monthly)
  • Health Insurance (BPJS): 4.00% of the employee’s salary (maximum of 480,000 IDR, not mandatory if the company offers a better health insurance)
  • Total Employment Cost: 10.24% – 11.74%

Employee Payroll Contributions in Indonesia

Employees in Indonesia also contribute to their social security as follows:

  • Old Age: 2.00% of their salary
  • Pension (JP): 1.00% of their salary (applied on salary up to 10,042,300 IDR monthly)
  • Health Insurance: 1.00% of their salary (maximum of 120,000 IDR monthly)
  • Total Employee Cost: 4.00%

Health Insurance in Indonesia

Indonesia offers a public healthcare system known as BPJS, but many opt for private health insurance to access higher-quality services and shorter wait times. The public system provides basic healthcare services, while private insurance offers enhanced coverage and facilities.

Pension in Indonesia

Indonesia’s pension system requires employees to meet certain eligibility criteria for old-age retirement benefits:

  • Women and Men: Must be at least 55 years old with a minimum of 15 years of contributions.

The pension amount is calculated based on the employee’s average salary and years of contributions.

Annual Paid Leave

Indonesian labor law guarantees employees annual paid leave of 12 days after one year of service. Additional leave days may be granted based

on company policies and years of service.

Parental and Maternity Leave

  • Maternity Leave: 3 months of paid leave.
  • Paternity Leave: 2 days of paid leave.

Sick Leave

Employees are entitled to paid sick leave, with the duration and coverage depending on the type of illness and years of service.

Regional and National Holidays

Indonesia observes several national holidays, including:

  • New Year’s Day (January 1)
  • Idul Fitri (varies)
  • Idul Adha (varies)
  • Independence Day (August 17)
  • Christmas Day (December 25)

There are also numerous other public holidays and observances throughout the year.

Employment Benefits in Indonesia

The Indonesian Social Security Administration (BPJS) administers the country’s government benefits programs, which include old-age pensions, disability benefits, illness and injury benefits, and parental leave. The BPJS collects contributions from employers and employees to maintain these social security benefits.

Termination and Notice Period in Indonesia

Employers must provide notice of termination as follows:

  • Notice Period: 30 days for indefinite-term contracts. Employers may opt to provide pay in lieu of notice.

For resignations, the notice period is generally 30 days.

Upon termination without cause, the employer must pay severance equivalent to one month’s salary for each year of service.

Understanding these aspects of employment benefits in Indonesia helps you navigate the complexities of hiring and managing staff. With Hyperion360, you can ensure compliance with local regulations while optimizing your global staffing strategy. Enhance your workforce with top Indonesian talent today!

Work-from-Home Arrangements and Remote Work in Indonesia

In response to the growing trend of remote work, Indonesia has implemented regulations to support flexible working arrangements:

  • Legal Framework: Indonesian labor laws allow for remote work arrangements, provided that both the employer and employee agree to the terms. The Ministry of Manpower has issued guidelines to support remote work.
  • Work Environment: Employers are responsible for ensuring that remote employees have a suitable work environment and necessary equipment.
  • Health and Safety: Employers must ensure that remote workers adhere to health and safety standards, including ergonomics and regular breaks.
  • Communication: Clear communication channels and regular check-ins are essential for remote work arrangements.

With Hyperion360 you don’t have to worry about compliance with local regulations for your Indonesian team.

How Hyperion360 Can Help You Hire Software Engineers in Indonesia

Navigating the complexities of hiring and managing software engineers in Indonesia can be challenging, but Hyperion360 simplifies the process with our comprehensive global staffing services. When you partner with Hyperion360, you pay us directly, and we take on all the legal and compliance risks, managing every aspect of HR, benefits, payroll, and local taxes.

Our Services Include:

  • Assuming Legal and Compliance Risk: Hyperion360 hires the software engineers directly, eliminating the legal risks of complying with Indonesian law for your company.
  • Managing HR Functions: We handle all HR-related tasks, from recruitment and onboarding to managing paid leave and termination, ensuring a smooth and efficient process.
  • Administering Benefits: Hyperion360 oversees employee benefits, including health insurance, retirement plans, and other statutory benefits, ensuring your workforce is well-supported and highly engaged.
  • Efficient Payroll Management: Our services include managing payroll cycles, payroll taxes, and bonus payments seamlessly. We handle all payroll processing, ensuring accuracy and timely payments for your software engineers.
  • Handling Local Taxes: The monthly fee you pay us for software engineers is inclusive of local payroll taxes, benefits, legal, HR, accounting, etc., so you can focus on your core business operations.

Benefits of Partnering with Hyperion360:

  • Access to Top Talent: Leverage our network to access a pool of highly skilled software engineers in Indonesia, ensuring you hire the best talent for your needs.
  • Streamlined Processes: Our integrated approach simplifies the hiring and management process, reducing administrative burdens and allowing you to focus on strategic business goals.
  • Cost-Effective Solutions: By managing HR, benefits, payroll, and compliance, we help you save time and resources, offering a cost-effective solution for expanding your team in Indonesia.
  • Comprehensive Support: From recruitment to ongoing management, Hyperion360 provides full support to ensure your Indonesian workforce is effectively managed and aligned with your business objectives.

With Hyperion360, you can confidently expand your tech team in Indonesia, leveraging our expertise to overcome common pitfalls and maximize the benefits of hiring skilled software engineers in this dynamic market.

Ready to hire software engineers in Indonesia? Contact us to learn more about how Hyperion360 can support your global staffing needs.

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