20%. A flat rate of 20% applies to nonresidents. The following table presents the ToS rates imposed on the monthly taxable salary of residents from 1 January 2023.
Tax on Fringe Benefits. The Tax on Fringe Benefits (ToFB) is imposed on taxable fringe benefits provided by an employer in cash or in kind, including the providing of, among other items, private use of vehicles, accommodation, food, utilities, household personnel, low-interest loans, discounted sales, educational assistance to employees and their children (except for employmentrelated training to employees), insurance premiums, unnecessary or unreasonable payments, social security and pension contributions in excess of the levels provided by the Labor Law, entertainment or amusement, and provision of shares.
The ToFB is borne by the beneficiary. Fringe benefits are taxable at a rate of 20% of the total value of the benefit provided. In determining the tax payable, the tax base equals the fair market value of the fringe benefit and any other applicable taxes.
Effective from 6 October 2016, the following allowances received by employees and workers for the performance of their employment activities are not subject to ToFB:
• Travel allowances from home to workplace or factory and from workplace or factory to home, and provision of accommodation or a dormitory in the factory in accordance with the Labor Law
• Food allowances provided to all employees and workers regardless of job classification and function (including overtime meals)
• Contributions to the Social Security Fund within the limit provided under the law (see Section C)
• Life and health insurance premiums provided to all employees regardless of job classification and function
• Infant allowances or nursery expenses as stipulated in the Labor Law
• Severance pay for the termination of a contract or indemnity for a layoff within the limit of the Labor Law
However, to claim the above exemptions, the employer must inform the tax authority about its allowance policy.
B. Other taxes
Net worth, gift, inheritance and estate taxes are not imposed in Cambodia.
C. Social security
The two types of social security schemes in Cambodia are pension and occupational risks. The contribution for the occupational risks scheme consists of an occupational risk contribution
(ORC) and a health care contribution (HCC). The occupational risks scheme and pension scheme are currently being applied. The pension scheme was implemented on 1 October 2022.
The ORC covers work-related accidents, accidents commuting between home and the workplace and other occupational diseases. The HCC covers health problems. All employers must register with the National Social Security Fund and make an ORC of 0.8% and HCC of 2.6% of the monthly average wages of the employees. The maximum monthly average wage per employee is KHR1,200,000, and the minimum monthly average wage per employee is KHR400,000. As a result, the maximum ORC per employee is approximately KHR9,600 (0.8% of KHR1,200,000), and the HCC per employee is approximately KHR31,200 (2.6% of KHR1,200,000).
The ORC and HCC are not refundable.
The pension contribution covers old-age pension, disability pension, funeral allowance and survivor’s pension. It is paid jointly between the employer and employee at the following rates:
• 4% (employer: 2% and employee: 2%) during the first five years (October 2022 to September 2027)
• 8% (employer: 4% and employee: 4%) in the next five years (October 2027 to September 2032)
• 10.75% (employer: 5.375% and employee 5.375%) in the next 10 years (October 2032 to September 2042)
• 2.75% in addition in every further 10 years
This pension contribution is compulsory, but employees can also volunteer to contribute additional pension payments (that is, voluntary pension contributions).
The pension is refundable at the age of 60.
D. Tax filing and payment procedures
Employees and other individuals are not required to file ToS/ ToFB and withholding tax returns with the tax authority. Employers and withholding agents must withhold ToS/ToFB and other income taxes from employees and other individuals before making payments. They must file monthly ToS/ToFB and withholding tax returns and remit the taxes to the tax authority on behalf of employees and other individuals.
If an employer resides outside Cambodia, it can appoint a fiscal representative (a local registered company) in Cambodia to be in charge of withholding the ToS/ToFB (before making the salary payment to employees) and remitting the ToS/ToFB to the Cambodian tax authority on its behalf. If no withholding of the ToS/ToFB is made, the fiscal representative appointed by the foreign employer is held responsible under Cambodian law.
Effective from January 2021, the ToS/ToFB and withholding tax return must be filed and the amount of tax must be paid to the tax authority through the tax authority’s e-filing system by the 25th of the following month and by the 20th day of the following month for manual filing.
Cambodia does not require the filing of an annual ToS/ToFB or personal income tax return.
In addition to the above, based on Instruction 110/23 dated 28 December 2023, a person whose name appears on the patent tax certificate of a registered company in Cambodia is also required to have a work permit.
It takes 20 working days to three months to obtain an approval for a work permit.
A work permit must be renewed every 12 months. From January to March of each year, an application to renew the work permit must be submitted to the Ministry of Labor online system together with the required documents.
H. Residence permits
Any person who does not have Cambodian nationality is considered to be alien. Aliens may obtain resident cards from the Ministry of Interior. The two types of resident cards for aliens are temporary and permanent.
Temporary resident cards. Temporary resident cards are valid for a period of two years and can be extended every two years. Temporary resident cards are issued for employees performing managerial, technical or specialized services.
The following documents must be submitted to obtain temporary resident cards:
• An application form for a temporary resident card
• Three copies of information slip form
• A copy of passport or any other equivalent document with proper visa
• Three photographs (4 cm x 6 cm)
• A copy of medical certificate from a doctor from the home country
• A copy of a written labor contract
• A copy of social security insurance
• A copy of the receipt of payment of temporary resident card tax
Permanent resident cards. Permanent resident cards are issued to foreign investors and their household members who have authorization to invest in Cambodia from the Council for the Development of Cambodia and to other individuals who are recognized by the Ministry of Interior.
The following documents must be submitted to obtain a permanent resident card:
• An application form for a permanent resident card
• A copy of the proclamation recognizing the alien as an immigrant alien who is a private investor
• A copy of passport or any other equivalent document with proper visa
• Three photographs (4 cm x 6 cm)
• A certificate from a Cambodian bank that evidences the deposit of a bond required by the Anukret (sub-decree)
• A copy of the receipt of payment of permanent resident card tax
I. Family and personal considerations
Family members. The spouse and dependents of a work permit holder must apply for a single-entry business visa and then a
multiple-entry business visa, which would enable them to live in Cambodia.
Forced heirship. No forced heirship rules apply in Cambodia.
Driver’s licenses. Drivers must have a Cambodian driver’s license. Some foreign nationals may be able to use their valid homecountry driver’s licenses to apply for a Cambodian driver’s license.