Explainer: What is the tax rate in Cambodia?

Gareth Johnson

If you live, work, do business, or receive money within the Kingdom then you are most likely required to pay tax, but what is the tax rate in Cambodia for individuals, residents and non-residents?

Although there is not technically an income tax within the Kingdom there is a monthly salary tax set by the General Department of Taxation.

This monthly salary tax is imposed on individual residents who derive income from employment and is done on a sliding scale based on how much the worker earns. This is the same for both locals and foreigners alike.

Monthly Tax Rate in Cambodia

Monthly salary (KHR*)Tax rate (%)
0 to 1,300,000 ($325)0
1,300,001 to 2,000,000 ($500)5
2,000,001 to 8,500,000 ($2125)10
8,500,001 to 12,500,000 ($3125)      15
Over 12,500,000                                20

The employer/company that pays salaries to its employees must prepare the tax on said salary which must be filed and paid to the General Department of Taxation by the 20th of the following month.

As tax is calculated monthly there is no annual income tax return required in Cambodia for employees.

The following allowances are exempted from taxation:

  • Transportation expenses (between work and home)
  • Accommodation allowances provided by employer
  • Meal allowances provided by employer
  • Social security or welfare fund
  • Health/life insurance  premium, as long as the premiums are paid for all employees
  • Baby care allowances and nursery expenses
  • Supply of uniforms or special equipment used for employment
  • Redundancy payments

Each resident is also entitled to a 150,000 KHR tax relief for each child they have up to 14 years old, or 25 if the child remains in full-time education.

What is the tax rate in Cambodia if you are employed?

If you are self-employed in Cambodia then you will fall under the business tax rate which means your tax rate is calculated in the same way as if you were a sole-proprietorship.

If you are classed as a small taxpayer this means a progressive rate up to 20 percent.

Who is considered tax resident in Cambodia?

People who are domiciled in Cambodia, have it as their principle place of abode, or spend more than 182 days within a year period in Cambodia are considered residents of the country for tax purposes.

Non-residents for tax purposes are those who spend less than 182 days in the Kingdom within a year period. The tax year in Cambodia runs from January 1st to December 31st.

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Taxes on global income for Cambodian residents

Those deemed resident in Cambodia are required to pay tax on their global income, as well as any income derived from within the Kingdom. This can be mitigated if tax is paid within the country it was derived from and if Cambodia has a double-taxation treaty with them.

If tax has been paid in another jurisdiction then proof must be shown in order to receive the tax credit.

Both global and local incomes for residents are theoretically combined to calculate the monthly salary tax that is due.

Tax rate in Cambodia for non-residents

Non-residents are not taxed from income derived from other countries. Non-residents are generally taxed at 20 percent on income and profits derived from holdings and ownerships in corporate entities.

Should the non-resident derive an income from a non-corporate company, such as sole-traders and partnerships they are subject to annual taxation based on the earnings of the company. These are as follows;

Annual taxable income (KHR)Tax rates (%)
0 – 16 million ($4000)0
16,000,001 – 24 million ($6000)5
24,000,001 – 102 million10
102,000,001 – 150 million ($37500)   15
Over 150 million20

This article is part of Cambodia Investment Review’s Explainer series. A simple guide to everything you need to know about business and investment in Cambodia.

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