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**For Employers**[**Executive Search & Headhunting**](https://www.jessonglobal.com/insights/topics/executive-search)Oct 31, 2026·8 min read

# Headhunter Fees in Indonesia: Rates, Tax and Worked Example

What a headhunter fee costs in Indonesia: the percentage anchors, what counts as the fee basis, and how VAT, PPh 23 and PPh 26 change your cash outflow.

![Jessica Baware](https://www.jessonglobal.com/_ipx/fit_cover&pos_top&q_76&s_44x44/cms-media/jessica-baware.jpeg)

By [**Jessica Baware**](https://www.jessonglobal.com/about#team)

Co-Founder & CEO, Jesson Global

A headhunter fee in Indonesia has no official tariff, so the rate is whatever your contract says. The best-documented anchor is one-third of first-year cash compensation, from Korn Ferry's annual filing, while Indonesian vendor blogs quote 20% to 30% of annual salary without citing a survey. The hiring company pays the fee, and tax changes the cash you send out.

## What is the usual headhunter fee in Indonesia?

Expect a percentage of the hire's first-year pay, and treat every published range as a starting point for negotiation. No regulator or industry body publishes an Indonesian fee survey that we could find, so there are two kinds of evidence, and they differ in strength.

The stronger one is a regulatory filing. Korn Ferry tells the US regulator that its search fee is [~~"generally one-third of the estimated first-year cash compensation"~~](https://www.sec.gov/Archives/edgar/data/0000056679/000005667926000021/kfy-20260430.htm) of the placed candidate, with a percentage added for indirect expenses. This is one global firm's practice, and it is not an Indonesian market rate.

The weaker one is vendor content. KitaLulus, an Indonesian hiring platform, says companies generally pay [~~20% to 30% of a year's salary~~](https://www.kitalulus.com/blog/info-hrd/jasa-headhunter/), but it names no data behind that range. In practice, use one-third as the upper reference for senior search, and ask each firm to put its own rate in writing.

## Which fee models will you be offered?

You will usually see retained or contingency terms, and the difference is when you pay and how much of the work the firm takes on. The Association of Executive Search and Leadership Consultants ([~~AESC~~](https://www.aesc.org/insights/blog/retained-executive-search-vs-contingency-whats-difference)) describes them this way.

| **Aspect** | **Retained** | **Contingency** |
| --- | --- | --- |
| When you pay | A retainer at the start of the relationship | After a candidate is identified and hired |
| Exclusivity | The firm works exclusively | You can use several agencies |
| Typical level | Senior executives and board directors | Entry to mid level |

Put simply, with retained you pay for the search, and with contingency you pay for the hire. Real contracts can mix the two, so read the payment schedule and not only the label.

## What counts as the fee basis, and why does it matter?

The fee basis is the pay figure the percentage applies to, and it can move your cost as much as the rate does. Some contracts use base salary only, while others add fixed allowances or guaranteed bonuses. Agree on this before you compare rates between firms.

The table is an illustration, not a market quote. It assumes a base salary of IDR 40 million a month and fixed allowances of IDR 10 million a month, so the basis is IDR 480 million on base pay alone and IDR 600 million with allowances.

| **Fee rate** | **Base only (IDR 480 million)** | **Base plus allowances (IDR 600 million)** | **Difference** |
| --- | --- | --- | --- |
| 20% | IDR 96 million | IDR 120 million | IDR 24 million |
| 25% | IDR 120 million | IDR 150 million | IDR 30 million |
| One-third | IDR 160 million | IDR 200 million | IDR 40 million |

Look at the middle row and the top row together. A 25% fee on base pay costs the same as a 20% fee on base plus allowances, so a lower rate is not always a cheaper offer.

Also check for an adjustment clause. Korn Ferry's filing describes an uptick fee when actual pay exceeds the estimate, so ask whether your firm bills a similar top-up if the final offer rises.

## What does tax add to a headhunter fee?

VAT raises the invoice, and income tax withholding changes who receives the cash without raising your total. The Directorate General of Taxes (DJP) explains that although the VAT rate is 12%, the 11/12 multiplier means the VAT charged on non-luxury goods and services [~~stays at 11%~~](https://www.pajak.go.id/en/node/113886). DJP also states that [~~PPh 23 on services is withheld at 2%~~](https://www.pajak.go.id/id/pph-pasal-23) of the gross value, and the rate is 100% higher if the recipient has no NPWP (tax number).

Whether a recruitment fee sits on the PPh 23 service list is a classification question, so confirm it with your tax adviser. The example assumes that it does, and that the firm charges VAT, on a fee of IDR 120 million.

| **Item** | **Calculation** | **Amount (IDR)** |
| --- | --- | --- |
| Fee | Agreed in the contract | 120,000,000 |
| VAT, effective 11% | 120,000,000 x 11/12 x 12% | 13,200,000 |
| Invoice total | Fee + VAT | 133,200,000 |
| PPh 23 withheld | 2% x 120,000,000 | 2,400,000 |
| Paid to the firm | Invoice - PPh 23 | 130,800,000 |

The withheld IDR 2.4 million is not an extra cost. You pay it to the tax office instead of to the firm, so your total outflow stays at the invoice amount. If the firm had no NPWP, the withholding would be 4%, or IDR 4.8 million, and the firm would receive that much less.

## Does it matter if the firm is outside Indonesia?

Yes, because the withholding tax changes, and the difference is large enough to raise before you sign. DJP states that [~~PPh 26 is 20%~~](https://www.pajak.go.id/id/pph-pasal-26) when the conditions for using a tax treaty are not met, and the treaty route needs the foreign party's DGT form or certificate of domicile.

On the same IDR 120 million fee, 20% is IDR 24 million, against IDR 2.4 million under PPh 23. In simple terms, a foreign firm without treaty relief either receives far less or asks you to gross up the fee, so settle who bears that tax in the contract.

## What should the contract say about the fee?

The contract should state the rate, the basis, the payment dates and the replacement terms, because those four items decide your real cost. [~~Permenaker No. 18 of 2024~~](https://jdih.kemnaker.go.id/asset/data_puu/2024pmnaker018.pdf) is the domestic placement rule, and Pasal 54 requires a private placement agency's written agreement with an employer to state the service fee and a placement guarantee, among other items.

The regulation does not set the length of that guarantee. Negotiate the following points yourself:

- The fee rate, and whether it is fixed or tied to the final offer.
- What counts as compensation in the basis.
- The payment schedule, including what you owe if you cancel the search.
- The replacement period, what triggers it, and whether it means a free search or a partial refund.
- Who bears withholding tax if the firm is foreign.

Pasal 11 also bars these agencies from charging job seekers placement fees, except for certain positions set by law. For most hires this means the company pays and the candidate pays nothing, so question any arrangement that bills the candidate.

## How do fees fit with the rest of the search decision?

Compare the fee with the scope of work, because a higher fee may cover assessment that a cheaper agency leaves to you. Our guide to [~~choosing an executive search firm in Indonesia~~](https://www.jessonglobal.com/insights/executive-search-firm-indonesia) covers the licence checks, and the [~~Bahasa guide to biaya jasa headhunter~~](https://www.jessonglobal.com/insights/biaya-jasa-headhunter) walks through the same tax mechanics for Indonesian-speaking finance teams. If timing is your main constraint, read [~~how long executive search takes in Indonesia~~](https://www.jessonglobal.com/insights/how-long-does-executive-search-take-in-indonesia-a-2026-complete-guide) as well.

As one published example of scope, Jesson Global's process runs four to eight weeks from kickoff to placement, delivers a shortlist of three to five vetted profiles, and includes support for both sides for the first 90 days. Searches in Indonesia run through PT. Jesson Global Indonesia. If you are pricing a Director-level or confidential role, you can see how a search is scoped on our [~~executive search page~~](https://www.jessonglobal.com/executive-search).

## FAQ

### **How much is a headhunter fee in Indonesia?**

There is no official tariff, so the fee is set in your contract. Korn Ferry reports that its search fees are generally one-third of the placed candidate's estimated first-year cash compensation, while Indonesian vendor blogs quote 20% to 30% of annual salary without citing a survey. Ask each firm for its rate and its fee basis in writing.

### **Who pays the headhunter fee, the company or the candidate?**

The hiring company pays. Permenaker 18/2024 prohibits private placement agencies from charging job seekers placement fees, except for certain positions regulated by law, and it requires the service fee to appear in the written agreement with the employer. Treat any request for payment from a candidate as a warning sign.

### **Is VAT charged on a headhunter fee?**

If the firm charges VAT, DJP explains that the amount charged on non-luxury services stays at 11% because of the 11/12 multiplier. On a fee of IDR 120 million, that adds IDR 13.2 million to the invoice. Your tax adviser can confirm how your own vendor's invoice should be treated.

### **Do I withhold tax on a headhunter fee?**

You may need to withhold PPh 23 at 2% of the gross fee, or a rate 100% higher if the firm has no NPWP. A foreign firm falls under PPh 26, which is 20% unless tax-treaty conditions are met. Whether a recruitment fee is on the PPh 23 service list should be confirmed with your tax adviser.

### **When is a headhunter fee paid?**

It depends on the model in your contract. AESC describes retained firms as charging a retainer at the start of the relationship, while contingency agencies are paid after a candidate is identified and hired. A contract can also split the fee into stages, so check the schedule and what you owe if the search is cancelled.

[**← Back to Insights **](https://www.jessonglobal.com/insights)

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