Every company and person here has to pay certain taxes to the government. These taxes are imposed on income earned, the profit derived, or the sales of certain goods or payable services. The taxes deducted are used to provide amenities such as public health, education, good roads, etc. for citizens residing within the territory.
Types of Taxes
There are four main kinds of tax in the country. They include Corporate income tax, personal income tax, value-added tax (VAT), and Withholding tax.
Corporate income tax
This tax is levied on income earned by corporations legally operating in the nation. The rates vary depending on the kind of business activities, type of taxpayers, and residency status. Generally, they range from 0 percent to 30 percent. However, entities categorized as medium and large for tax purposes are charged 20%. Small businesses pay from 0% up to 20% rates. A tax return has to be filed within three months following the end of a tax year.
Personal income tax
This tax is direct and levied on incomes earned by individuals. Although this is not yet enforced, taxpayers pay via Tax on Salary withholding which is deducted monthly by employers. A person is liable to be charged for taxes if such a person resides in the Kingdom of Cambodia, has a permanent residence, or is physically present for 182 days or more in a concurrent tax year. Residents pay taxes at the following rates:
| Monthly salary (KHR) | Tax rates |
| 0 – 1.3 million | 0% |
| 1,300,001 – 2 million | 5% |
| 2,000,001 – 8.5 million | 10% |
| 8,500,001 – 12.5 million | 15% |
| Over 12.5 million | 20% |
Persons who do not meet the above-mentioned conditions are deemed, non-residents. They are subjected to a 20% flat rate. When non-corporate business owners, entrepreneurs, and partnerships gain profits from business activities carried out by their enterprises, they are liable to individual tax rates ranging from 0 percent to 20 percent. Fringe benefits are levied at a rate of 20 percent.
Value-added tax (VAT)
VAT is a tax imposed on the prices of purchasable goods or taxable services provided by a business entity in the Kingdom. The supply of goods and services here is subjected to a fixed VAT rate of 10 percent. However, a zero-rate VAT applies to certain goods and services such as those provided by Qualified Investment Projects (QIPs) of supporting industry, services executed within the nation but used outside, services carried out outside or used outside by a non-resident entity, the domestic supplies of paddy rice, local supplies of specific agricultural products, such as plant seeds, animal medicine, animal food, etc. Specific supplies are not subjected to VAT. They include public postal services, medical and dental goods, and services, insurance services, educational services, unprocessed agricultural products, et cetera.
Withholding tax
Withholding tax is an indirect tax imposed on the income of resident taxpayers and non-residents. It is withheld by employers or those in charge of such incomes. The withholding tax rates on payments to residents are shown in the table below:
| Types of income | Rate |
| Income made from services including management, consulting, and other similar services | 15% |
| royalties payments for intangible assets and interest in minerals, oil, or natural gas | 15% |
| Payable interests to an individual or a firm except for those paid to a Cambodian bank or savings institution | 15% |
| Payable interest on a fixed deposit by a local bank or savings institution made to a resident taxpayer | 6% |
| Income derived from the rent of movable and immovable properties | 10% |
| Interest received on a savings account to a resident taxpayer through a local bank or savings institution | 4% |
