An Overview of Real Estate Taxes in Cambodia - KW Cambodia (2024)

FAQs

How much is property tax in Cambodia? ›

Property tax in Cambodia is officially known as the Tax on Immovable Properties (TOIP). Immovable properties include: land, houses, infrastructure, buildings, other construction, etc. TOIP imposes an annual tax rate of 0.1% on immovable properties that value over $25,000 (KHR 100 million).

Capital gains tax

The MEF issued Prakas No. 346 to implement capital gains tax on sale or transfer of immovable property, leases, investment assets, goodwill, intellectual property (IP), and foreign currencies. The tax rate on capital gains is flat at 20%.

Asset transfer tax is levied on the acquisition of real estate at 4% of the higher of the government's real estate appraisal value or purchase price. This is the tax you pay when you purchase a property, and no asset ownership certificate will be issued until you have paid this asset transfer tax.

There is no personal income tax, per se, in Cambodia. Instead, a monthly salary tax is imposed on individuals who derive income from employment.

One notable advantage of Cambodia's real estate market is its affordability compared with other countries in the region. Property prices in Cambodia are significantly lower, making it an attractive investment option for those seeking good value for their money.

Residential plots are selling at $3,500/sqm on average. For commercial land, the average price is $6,100/sqm. Within Daun Penh, the sangkats of Phsar Thmey 1,2, and 3 have the most expensive commercial land, selling at $9,000 per sqm on average.

It is calculated by subtracting the asset's original cost or purchase price (the “tax basis”), plus any expenses incurred, from the final sale price. Special rates apply for long-term capital gains on assets owned for over a year.

A taxable gain is a profit earned on the sale of an asset. To calculate the taxable gain on the sale of an asset, an individual takes the difference between the original purchase price and the sale price of the investment.

Not all countries impose a capital gains tax, and most have different rates of taxation for individuals compared to corporations. Countries that do not impose a capital gains tax include Bahrain, Barbados, Belize, the Cayman Islands, the Isle of Man, Jamaica, New Zealand, Sri Lanka, Singapore, and others.

Small taxpayers – earning an annual income between KHR250 million (US$61,000) to KHR700 million (USD$171,000) Medium taxpayers – earning an annual income between KHR 700 million (about US$171,000) to KHR 2,000 million (US$490,000) Large taxpayers – earning annual income more than KHR 2,000 million (US$490,000)

What is transfer pricing law in Cambodia? ›

The purpose of transfer pricing rules is typically to make sure related entities compensate each other appropriately in an amount that is commensurate with the value of the property transferred or services provided and to prevent entities from manipulating profits between related parties to minimize tax exposure.

The purchase alone is not taxable. However, what you do with the property or investment might determine whether you must report it on your U.S. taxes. If the property is used for business purposes, you would have to report the income you earn from the property.

This tax aims to encourage the use of land and benefit the sub-national administrative budget. Property tax, officially known as TOIP or Tax on Immovable Properties, is imposed to properties located in the municipality and provinces that are more than 100 Million Riel ($25,000) in value.

According to Article 33 of the Law on Taxation, Cambodian-source income includes: Interest paid by a resident enterprise, resident pass-through, or a governmental institution of Cambodia. Dividends distributed by a resident enterprise. Income from services performed in Cambodia.

Certain exemptions exist for government-owned property, agricultural land, property owned and used for cultural and religious purposes, property of foreign embassies and NGOs, and property in the special economic zones.

Cost of Housing

Couples and families can expect to pay $250-$1000+ per month depending on what type of amenities they require. Reasonably priced housing is available all over the city and can help cut down on your cost of living in Cambodia.

All the countries without property tax for residents and non-residents are Bahrain, Cambodia, the Cayman Islands, Cambodia, Croatia, the Cook Islands, Fiji, Georgia, Dominica, Israel, Kuwait, Liechtenstein, Malta, Monaco, Oman, Qatar, the Faroe Islands, Fiji, Oman, Qatar, Saudi Arabia, the Seychelles, and Sri Lanka.

UHY's findings show that Belgium has the highest average property taxes for real estate worth USD 1 million of any country in the study at 11.3%* - a charge of USD 113,131.

According to the analysis by Tax Foundation, New Jersey residents pay the highest in the country - a median of $8,797.