Cambodia: VAT and e-commerce transactions

Procedure for the simplified VAT registration procedure, invoice issuance rules, and monthly declaration requirements

Simplified VAT registration procedure, invoice issuance rules

The tax administration issued guidance (Instruction no. 20522, 8 December 2021) to clarify the rules and procedures with regard to value added tax (VAT) and electronic commerce (e-commerce) transactions.

The guidance specifically addresses the procedure for the simplified VAT registration procedure, invoice issuance rules, and monthly declaration requirements.

In general, there is a VAT obligation with regard to e-commerce transactions for the supply of digital goods or digital services or any e-commerce activity by taxable persons who are non-resident taxpayers—including electronic platform operators—to residents of Cambodia. However, activities or e-commerce transactions of Cambodian resident taxpayers are not within the scope of the December 2021 guidance. The new instruction guidance mentions that the supply of digital goods or digital services or any e-commerce activity (pursuant to Article 57 of the tax law) will be considered non-taxable supplies.

Instruction no. 20522 provides further clarification on business-to-business (B2B) and business-to-consumer (B2C) transaction determinations and payment methods. Also, it clarifies on the registration procedure, the timeline of registration, and the rules for deregistration of a business. Taxable persons (both resident purchasers and non-resident suppliers) that fail to register or to update information or that fail to declare and pay VAT will be subject to penalties.

Non-resident suppliers must complete their tax registration by 31 December 2021 and satisfy their VAT compliance obligations to avoid the assessment of penalties.

Read a December 2021 report [PDF 274 KB] prepared by the KPMG member firm in Cambodia 

 

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