Required capital for small business tax registration

NLove · Post by **NLove** » Tue Apr 14, 2020 1:05 pm

Hi, I need help about the sole proprietor registration. I found following information here:

https://www.b2b-cambodia.com/industry-o ... 201d3-cd42

“...the minimum capital requirement is $1,000, the Ministry of Commerce in practice requires $1,300 as a minimum, and furthermore the Tax Department generally requires at least $5,000 in minimum capital. Therefore it is best to state a minimum capital of $5,000...”

Does this mean I can not start my business if I will not have $5000 in my bank account?

I planed to pay deposit to rent a property in a couple days. If I pay this, I will not have $5000.

My landlord says I don’t need to do anything nor pay tax for small business. Because in the small village where I will rent the house, no one cares such thing.

But I think that I also need documents for visa renewal.
I don’t know if I can start renting rooms to people without registering and not much money left in my bank account.

Is there anyone who has done these paper works recently, knows anything? (I heard law changed in 2016 and became stricter?)

Thanks!

truffledog · Post by **truffledog** » Tue Apr 14, 2020 4:02 pm

On one side I admire anyone who opens up a "guesthouse" of any type with around 5 grand in their hands. Cambodia needs brave people who invest and create jobs, especially in the countryside. On the other side I feel that this may be one of the many buisness ideas where no proper simple financial planning has been made to the minimum capital needed even in the best of cases. I hope you prove me wrong. I still wish you the best of luck and success in the KINGDOM OF WONDERS.

Follow your dreams or you will spend the rest ofyour life working for somebody who did.

NLove · Post by **NLove** » Tue Apr 14, 2020 7:27 pm

So you think I should not start my business with such a small capital, right?

I have another income to pay the rent. Therefore I thought I would not taking too much risk.

I just want to rent a few rooms by AirBnb.
Maybe developing this to more like a guesthouse in the future if necessary.

Any advice is welcome.

AndyKK · Post by **AndyKK** » Tue Apr 14, 2020 8:19 pm

NLove wrote: ↑Tue Apr 14, 2020 7:27 pm So you think I should not start my business with such a small capital, right?

I have another income to pay the rent. Therefore I thought I would not taking too much risk.

I just want to rent a few rooms by AirBnb.
Maybe developing this to more like a guesthouse in the future if necessary.

Any advice is welcome.

What part of the country are you setting up your new venture, and are you doing this alone, without any Khmer involved with you?
Have you now got your visa and work permit?

TaxKHpro · Post by **TaxKHpro** » Tue Apr 14, 2020 8:45 pm

NLove wrote: ↑Tue Apr 14, 2020 1:05 pm Hi, I need help about the sole proprietor registration. I found following information here:

https://www.b2b-cambodia.com/industry-o ... 201d3-cd42

“...the minimum capital requirement is $1,000, the Ministry of Commerce in practice requires $1,300 as a minimum, and furthermore the Tax Department generally requires at least $5,000 in minimum capital. Therefore it is best to state a minimum capital of $5,000...”

Does this mean I can not start my business if I will not have $5000 in my bank account?

I planed to pay deposit to rent a property in a couple days. If I pay this, I will not have $5000.

My landlord says I don’t need to do anything nor pay tax for small business. Because in the small village where I will rent the house, no one cares such thing.

But I think that I also need documents for visa renewal.
I don’t know if I can start renting rooms to people without registering and not much money left in my bank account.

Is there anyone who has done these paper works recently, knows anything? (I heard law changed in 2016 and became stricter?)

Thanks!

As a sole proprietorship if you register as a Small Taxpayer there are no capital requirements.

The first step is to reserve a name https://www.businessregistration.moc.go ... 2548708126

The link you attached is of you decide to register as a Medium Taxpayer. With a Small Taxpayer, the accounting requirements are simplified (no double entry).

NLove · Post by **NLove** » Tue Apr 14, 2020 8:53 pm

It’s at a small village but touristic place. My western friend will help me as a volunteer Worker.
I don’t plan to ask any Cambodian get involved in for instance.

I have EB visa. I was thinking to apply for the work permit.

Thanks

AndyKK · Post by **AndyKK** » Tue Apr 14, 2020 10:03 pm

There is no harm in doing it yourself, think about what you need to be in business and go for it, I have also known people to find the officals for certain paperwork had proven difficult at times out in the back of beyond. Good luck to you.

NLove · Post by **NLove** » Tue Apr 14, 2020 10:24 pm

TaxKHpro wrote: ↑Tue Apr 14, 2020 8:45 pm
NLove wrote: ↑Tue Apr 14, 2020 1:05 pm Hi, I need help about the sole proprietor registration. I found following information here:

https://www.b2b-cambodia.com/industry-o ... 201d3-cd42

“...the minimum capital requirement is $1,000, the Ministry of Commerce in practice requires $1,300 as a minimum, and furthermore the Tax Department generally requires at least $5,000 in minimum capital. Therefore it is best to state a minimum capital of $5,000...”

Does this mean I can not start my business if I will not have $5000 in my bank account?

I planed to pay deposit to rent a property in a couple days. If I pay this, I will not have $5000.

My landlord says I don’t need to do anything nor pay tax for small business. Because in the small village where I will rent the house, no one cares such thing.

But I think that I also need documents for visa renewal.
I don’t know if I can start renting rooms to people without registering and not much money left in my bank account.

Is there anyone who has done these paper works recently, knows anything? (I heard law changed in 2016 and became stricter?)

Thanks!
As a sole proprietorship if you register as a Small Taxpayer there are no capital requirements.

The first step is to reserve a name https://www.businessregistration.moc.go ... 2548708126

The link you attached is of you decide to register as a Medium Taxpayer. With a Small Taxpayer, the accounting requirements are simplified (no double entry).

Okay! Thank you!

NLove · Post by **NLove** » Tue Apr 14, 2020 10:28 pm

AndyKK wrote: ↑Tue Apr 14, 2020 10:03 pm There is no harm in doing it yourself, think about what you need to be in business and go for it, I have also known people to find the officals for certain paperwork had proven difficult at times out in the back of beyond. Good luck to you.

Thank you for encouragement!

angkorjohn2 · Post by **angkorjohn2** » Tue Apr 14, 2020 10:28 pm

As long as you are not anticipating making any return off this for 6-12 months, which is the most hopeful projected time frame for people to start being allowed to travel in and out of Cambodia and any sign of tourism coming back to the region, then it is no harm. If you are fine to rent this place paying the full amount monthly for that period then fine, if you aren't then it sure would be a sad time to lose your savings on an ill timed venture.

Required capital for small business tax registration

Required capital for small business tax registration

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