A financial management law, enacted at the end of 2019, includes certain tax amendments. The tax measures in the law address the application of the tax rate, as well as advance taxation and withholding tax on certain dividend distributions.
The new rules provide that dividends distributed by a qualified investment project under a “tax holiday” (and thus is subject to a 0% tax rate) will be subject to tax at a rate of 20%. In other words, the qualified investment project is subject to a 0% rate of tax, but if it distributes dividends to its shareholders out of retained earnings, such dividend distributions are subject to a 20% rate of tax. Thus, the tax holiday was in reality a tax deferral.
The General Department on Taxation issued guidance in December 2019 concerning the use of rates of exchange by taxpayers under the self-assessment regime. The new guidance establishes the rules for the use of exchange rates, effective January 2020.
Read a January 2020 report [PDF 1.05 MB] prepared by the KPMG member firm in Cambodia
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