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Individuals are classified either as resident or non-resident taxpayers. Resident taxpayers are taxed on their worldwide salary income, whereas income tax for non-resident taxpayers is taxed only on Cambodian-sourced salary income. Employment income is subject to salary tax. Other non-employment income such as rent, interest, dividends, and consulting income is not subject to salary tax, but may be subject to profits tax.  The Cambodian tax year runs from the 1st of January to 31st December each year.  However, individuals are not required to submit annual personal income tax returns and accordingly, the monthly salary tax deduction is considered to be a final tax for individuals.

Key Message

There is no individual tax registration obligations and the tax obligation to withhold tax falls to the employer. Individuals are not required to file tax returns.


A person’s liability to Cambodian tax is determined by residence status.  An individual is considered a tax resident, if:

  • the individual is domiciled in Cambodia
  • the individual has a principal place of abode in Cambodia or
  • the individual is present in Cambodia for more than 182 days during the 12-months period ending in the current tax year.

Individuals who meet the above definition of a resident are taxed on their worldwide salary income (i.e. salaries from both Cambodian and foreign sources). A non-resident is considered as any person who does not meet the above definition of a resident and are taxed only on their Cambodia sourced salary income.  The tax to be paid is determined based on the gross monthly taxable salary of the individual.  As a general rule, it can be stated that all types of remuneration and benefits received by an employee within the framework of fulfilling employment activities constitute taxable income. These include wages and salary, bonuses, overtime, and other remuneration.


Cambodian-sourced salary is defined as salary received within the framework of fulfilling employment activities in the Kingdom of Cambodia.  In practice the tax office treat all salary received in relation to employment activities within the Kingdom of Cambodia as Cambodia-source salary, regardless of the origin or country where the remuneration is paid.


Currently, there is no mechanism for an individual assignee to register with the local tax authorities and directly pay their salary and fringe benefit tax on their own, and hence only registered employers would do the compliance for the assignee.  Technically, there is no threshold/minimum number of days that exempts the employee from the requirements to file and pay tax in Cambodia.


All types of remuneration and benefits received by an employee within the framework of fulfilling employment activities constitute taxable income. This includes salary and wages, redundancy payments, bonuses, overtime, and other compensation. Cambodia also has a fringe benefits tax regime, which levies tax on fringe benefits provided to employees, such as private use of motor vehicles, food and accommodation, utilities and domestic staff and pension fund contributions exceeding 10 percent of the employee’s monthly salary. Non-residents are taxed at a flat rate of 20 percent on their Cambodian-sourced income only. 


Foreigners are required to have a work permit.

On 20th May 2016, Cambodia signed its first DTA agreement with Singapore. On 13th October 2016, Cambodia signed its 2nd DTA with China. Subsequently, on 27th July 2017, 9th September 2017, and 31 March 2018 additional DTAs were also signed with Brunei, Thailand and Vietnam respectively. At the date of publication of this guide, the Cambodian tax office implemented two DTAs with Singapore and Thailand as of 1 January 2018.

Residents are taxed at progressive rates ranging from 5 percent up to 20 percent. Residents are entitled to tax relief of 150,000 Cambodian riel (KHR) per month for each child and KHR 150,000 for a dependent spouse (before January 2017, residents were entitled for tax relief of KHR75,000). Non-residents are taxed at a flat rate of 20 percent. Fringe benefits provided by employers are subject to fringe benefits tax at the rate of 20 percent. The value of fringe benefits is the fair market value of the benefit provided, inclusive of all taxes.


National Social Security Fund (NSSF) registration for new enterprises is required to be done within 30 days of the date of the opening of the enterprise. However, in practice, this registration can only be started after the new enterprise has at least one staff member.

Subsequent to the initial registration with the NSSF, new staff are required to present themselves physically at the NSSF for registration within three (3) days after their date of employment.

After registration with the NSSF, enterprises are required to file monthly reports and make monthly contributions to the NSSF for two social security schemes: the "occupational risk scheme" and the "healthcare scheme". The contribution rates are 0.8% of the average monthly wage of employees for the occupational risk scheme and 2.6% of the average monthly wage of employees for the healthcare scheme.


Employee compliance obligations

Currently, there is no mechanism for an individual assignee to register with the local tax authorities and directly pay their salary and fringe benefit tax on their own, and hence only registered employers would do the compliance for the assignee.

Employer reporting and withholding requirements

Employers or the resident representative of foreign employers, and employees are jointly responsible for the payment of tax on salary in Cambodia, regardless of whether the salary is paid in Cambodia or abroad.

Salary tax is due to be paid by the 20th day of the month following the payment of salary (before January 2017, it was due by the 15th day). In practice, since there is no mechanism for individuals to register with local tax authorities it is the employer’s responsibility to withhold and pay salary and fringe benefit taxes to the Department of Taxation by the due date.


Work permit/visa requirements

A visa must be applied for before an individual enters the Kingdom of Cambodia (though citizens of certain countries do not required a visa). In some cases, visas may be granted on arrival. The type of visa required will depend on the purpose of the individual’s entry into Cambodia. In order to legally work in Cambodia, ordinarily a Class E “Ordinary” visa is required (except in the case of diplomats and other foreigners on official missions or with international organizations, who require a Class B visa). The Class E “Ordinary” visa is issued for one month, single-entry, and can be extended during its validity for one or three months (with single entry) or for six or twelve months with multiple entries. To renew or extend the Class E “Ordinary” visa, the Immigration Police will require a business permit and patent tax certificate, OR an employment contract, OR relevant document(s) proving that it’s necessary to extend the stay.

Foreigners working in Cambodia are also required to apply for a work permit. No foreigner can legally work in Cambodia unless they possess a work permit and an employment card issued by the Ministry of Labor and Vocational Training (MLVT). The work permit is valid for one calendar year and must be renewed by 30 March of the following year.

Foreigner work permits can be applied for through the local employer who is registered with the MLVT. The employer in Cambodia must also have an available Foreign Manpower Quota (FMQ) approved by the MLVT to employ foreigner(s). The FMQ application for the following year must be made by 30 November of the current year. This quota of foreigners cannot be more than 10% of the total number of Cambodian employees. If the employer wants to employ more foreigners than the quota, an application must be made to increase the quota. However, approval of the increased FMQ is subject to the decision of the MLVT.

Relief for foreign taxes

A resident taxpayer who has received foreign-sourced salary and who has paid taxes according to foreign tax laws shall receive a tax credit in Cambodia providing there is compliance with certain conditions.

Permanent establishment implications

There is the potential that a permanent establishment (PE) could be created as a result of extended business travel, but this would be dependent on the type of services performed and the level of authority the employee has.

Indirect taxes

Taxable supplies attract Value Added Tax (VAT) at either the standard rate of 10% or the zero rate. The zero rate applies to export of goods and services and certain charges in relation to international transport of people and goods. Also, this zero rate is applicable for any goods and services supplied by supporting industries Qualified Investment Project (QIP)/contractors to particular export industries.
VAT on certain supply and import of certain agricultural products and daily basic foods for people shall be borne by the State (i.e. State Charges).

In addition, certain items are exempt from VAT (subject to approval from the Ministry of Economy and Finance).

Local data privacy requirements

Cambodia currently has no data privacy laws.

Exchange control

The Foreign Exchange Law of 1997 provides that there should be no restrictions on foreign exchange operations. However, these operations can only be performed through an authorized financial institution. Although the KHR is the official currency of Cambodia, the US dollar (USD) is in common circulation and the majority of commerce is denominated in USD. There are no restrictions on the establishment of foreign currency bank accounts in Cambodia for residents.

Non-deductible costs for assignees

Employees are not allowed any deductions against their salary income, as employees are not required to submit annual tax returns. There are currently no established guidelines with regard to costs that are nondeductible for employers or assignees.

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