Effective dates announced for property, shares, and financial asset taxation
Cambodia Investment Review
In a landmark regulatory shift, the Royal Government of Cambodia has officially launched its long-anticipated Capital Gains Tax (CGT) regime through the issuance of Prakas 496 MEF.PRK, marking a significant step in aligning domestic tax policy with international norms.
The move, spearheaded by the Ministry of Economy and Finance, will bring gains from property, shares, and various financial assets under a new structured taxation framework. The reform comes with the stated objective of improving fiscal equity and broadening Cambodia’s tax base.
Key Implementation Dates:
- From 1 September 2025: CGT applies to gains on leases, investment properties (including shares), business goodwill, intellectual property, and foreign currency.
- From 1 January 2026: CGT extends to real estate transactions.
Under the newly issued Prakas 496, taxpayers will face a flat 20% CGT rate, applicable to profits derived from the disposal of specific capital assets. The regulation also outlines a set of exemptions, allowable deductions, and filing requirements, prompting both individuals and businesses to reassess their holdings and corporate structures.
Global Alignment, Local Consequences
Cambodia’s tax reform places it among a growing list of developing nations modernizing their tax regimes to reflect global best practices. According to DFDL Cambodia, a leading regional law and tax advisory firm, the implications for shareholders, real estate investors, and businesses involved in restructurings are wide-reaching.
“Whether you’re planning a share sale, transferring IP, or holding foreign currency assets, this is not a change to overlook,” said Clint O’Connell, Partner and Managing Director of DFDL Cambodia. “Prakas 496 brings both strategic opportunities and compliance risks, especially in relation to timing and asset classification.”
DFDL’s tax advisory arm, Mekong Tax Services Co., Ltd, is licensed in Cambodia (License No. TA201701018) and is already advising clients on how best to navigate the short runway before enforcement begins.
Strategic Implications for Businesses and Investors
Tax experts warn that the September and January phase-ins leave a narrow window for tax planning. Key focus areas include:
- Corporate Group Restructuring: Businesses with intra-group transfers involving Cambodian companies must assess potential CGT exposure.
- Share Transactions: Investors looking to exit or restructure holdings before 1 September may wish to act swiftly.
- Real Estate Holdings: With real estate entering scope in early 2026, property owners should review valuations and holding structures in advance.
