This in itself represents a very significant development as those sole proprietors whose annual turnover exceeds approximately USD5k per month, on average, will now be required to charge VAT, file monthly and annual tax returns, collect and pay certain withholding taxes and be subjected to tax audits whereas previously they would probably have negotiated their taxes upfront with the tax officer (under the estimated tax regime).
It would appear that those sole proprietors whose turnover does not exceed on average USD5k per month will not be required to pay any tax – be it corporate or patent tax.

[/Are investment income and capital gains taxed in Cambodia? If so, how?

Non-employment income sourced within Cambodia is not subject to salary withholding tax. However, profits tax may be payable.
quote]

Jack.R. wrote: ↑Sun Dec 10, 2017 12:45 am How did you get the 500.000.000riel tax audit fine Laudjohn? That's really high. Did you have high profitability and particularly large turnover? Did they give you any explanation?

james1234 wrote: ↑Sun Dec 10, 2017 2:10 am I found a a tax update
https://www.dfdl.com/resources/legal-an ... uary-2016/

This in itself represents a very significant development as those sole proprietors whose annual turnover exceeds approximately USD5k per month, on average, will now be required to charge VAT, file monthly and annual tax returns, collect and pay certain withholding taxes and be subjected to tax audits whereas previously they would probably have negotiated their taxes upfront with the tax officer (under the estimated tax regime).
It would appear that those sole proprietors whose turnover does not exceed on average USD5k per month will not be required to pay any tax – be it corporate or patent tax.

So to me its seems to be correct that you can have a small business that has a turn over of less than $5000 per month you don't have to file tax/VAT and other shit reports. That is really great because I hate these paperwork. Another reason to move to Cambodia

I presume I still have to pay income tax? How do you file this, or can you just save some money wait till shit hits the fan and than negotiate your way out?

Update: Found something extra:

[/Are investment income and capital gains taxed in Cambodia? If so, how?

Non-employment income sourced within Cambodia is not subject to salary withholding tax. However, profits tax may be payable.
quote]

That is old information. Look for the 2017 updates.

GDT to visit all businesses in Phnom Penh to collect data. Even those enterprises that do not meet the criteria to register as a small real regime taxpayer are still required to register with the GDT as per Prakas on Tax Registration No. 496 that was issued earlier this year.

james1234 wrote: ↑Sun Dec 10, 2017 7:08 pm Have been reading 10 pages of updates and did not find any info for very small business with turnover up to 5000$.

I did find this article: https://www.dfdl.com/resources/legal-an ... ect-data/

GDT to visit all businesses in Phnom Penh to collect data. Even those enterprises that do not meet the criteria to register as a small real regime taxpayer are still required to register with the GDT as per Prakas on Tax Registration No. 496 that was issued earlier this year.

So they start in PP and do the rest of the country later.

My conclusion:
= For the Cambodia tax law: • Small enterprise is a single person entity or partnership. - Annual turnover from KHR 250 million riels to KHR 700 million riels.
= Company with turnover below 5000$ must be very very small company, and for what I believe after reading a lot of stuff, must NOT do VAT filing and no profit tax filing at this moment (12-2017).
= Most Khmer and expats do not register such very small business.
= Government is trying to get a grip on tax filing and trying to get everyone registered, of course to have them pay tax later.
= Fines for not filing or wrong filing are not that high. From up to 10% for first offenders to up to 25% for more heavy cases (here up to 100%). But sometimes the officials just guess and set high fine that can be negotiated (preferable by Khmer representative). So just save the money in a bankaccount and see what happens.
= It will probably take some years, but every small and very small business will be registered and pay taxes
= Bookkeeping for very small and small companies is very simple: sales book, purchase book and annual stock. That's it.

So it is still a nice environment to start a small project as sole proprietorship. Taxes are not that high (lot lower than in Europe). Not registering is not that dangerous, but make sure you have money to pay the VAT and Taxes if necessary. 10% VAT and 10-15% of profit for small company.

So please, if my information and assumptions are wrong or uncomplete, please correct me

LaudJohn wrote: ↑Sat Dec 09, 2017 3:03 pm DO NOT

I repeat..

DO NOT

register and operate under an MOC registered company structure here unless absolutely necessary.

Operate as a sole trader.

I have two companies. One I bought as it was the only way to buy the asset. I need to close it down soon as I have a bullshit audit tax bill of over 500,000,000 riel. It includes an audit for years for which I have already been audited and settled with the tax office.

The tax officials never once came to the business, never once asked to see the books. They pick a number out of thin air and then add penalties etc and make you negotiate. The officials are paid a commission. I am going to have to transfer the asset into some elses name and close that company, which will increase the risk of this 6 figure investment markedly. I still pay my local former manager (more each month than an English Language teacher earns in SHV), to deal with these issues on call for me, despite the business no longer operating.

I have registered another company to own land. It does not trade and has only just got its first non revenue producing asset and It still costs me $165 per month to get the tax papers done each month and pay a token amount of tax.

You can take advice from others who may think "they know", but I am advising you from bitter experience.

There's an issue I'd like to raise, about the visa ? You'll be living here on tourist visa and will have to come back and worth as you're not registered to MOC or MOL (labour) to provide a work permit.