Cambodia’s taxation rules vary according to the taxpayer’s regime, the classification of taxpayers under different tax collection and control procedures of the GDT. The self-declaration regime is the only tax regime in Cambodia. Under the self-declaration regime, taxpayers are classified into three categories (e.g. large, medium, and small taxpayers) based on their turnover, legal form, and other criteria (see table below).
|Type of taxpayer||Criteria (turnover is in approximate United States dollars [USD])|
|Small||Sole proprietorship or partnership:
Resident taxpayers are subject to tax on worldwide income while non-residents are taxed on Cambodian-sourced income only. A permanent establishment (PE) is taxable on its Cambodian-source income only.
Corporate tax rate
The standard rate of corporate income tax (CIT), previously known as tax on profit, for companies and PEs who are classified as medium and large taxpayers is 20%.
For companies and PEs who are classified as small taxpayers, the CIT rates are progressive rates from 0% to 20%.
Industry-specific tax rates
Oil and gas and certain mineral exploitation activities are subject to CIT at the rate of 30%.
Insurance companies are taxable at a rate of 5% on the gross premium income and at the rate of 20% on other income derived from non-insurance/reinsurance activities. Net interest income of insurance companies received after 4% or 6% WHT is not taxable income.
The small taxpayer is subject to CIT at the progressive rates as stated in Article 20 of the Law on Taxation.
Minimum tax (MT)
Self-declaration regime taxpayers are subject to a separate MT. The MT is an annual tax with a liability equal to 1% of annual turnover inclusive of all taxes except VAT.
As a separate tax to the CIT, the MT is due irrespective of the taxpayer's profit or loss position (i.e. the MT will be liable if the 1% of total annual turnover exceeds the 20% CIT liability).
According to the Law on Financial Management 2017, the MT is no longer applicable to enterprises that maintain proper accounting records from 1 January 2017. However, there is still no definition of what constitutes ‘maintaining proper accounting records’.
Additional CIT on dividend distribution
A dividend-paying taxpayer is required to pay an additional CIT at the time of dividend distribution if the profit was previously subject to a 9% or 0% CIT. The rates of additional CIT vary depending on the profits to be distributed. For profit that has been subject to CIT at the rate of 20%, 9%, or 0%, that profit will be subject to additional CIT at the following rates, respectively:
|20% (standard rate)||0%|
|9% (preferential rate, which is no longer applicable after 31 December 2010)||11/91 (approximately 12.09%)|
|0% (during tax holiday)||20%|
A shareholder is entitled to establish a special dividend account from which the relevant dividend that was already subject to 20% CIT may be on-paid without further additional CIT obligations.
A dividend will be exempt from tax in the hands of the shareholder if additional CIT and WHT for non-resident shareholders has been paid.
Local income taxes
Provincial and local income taxes are not applicable in Cambodia.