Cambodian Property Tax Guide

Tax Considerations When Purchasing, Selling or Leasing a Residential Property in Cambodia

Cambodia has implemented various tax incentives and policies to attract foreign investment, including in the real estate sector. Here are some key points regarding taxes for foreign property investors in Cambodia. Property taxes are a requirement, regardless of whether the investor is a Cambodian national or a foreign investor.

The property taxes that apply to the purchase of a property in Cambodia are:

Tax On Immovable Property (TOIP)

Immovable properties include land, houses, condos, buildings, infrastructure and other constructions. The tax is calculated as follows:

0.1% x 80% of market value of the property less US$25,000 (any property under US$25,000 is exempt from the tax)

Example: A condo purchased for US$500,000 is taxed as such:

$500,000 x 80% = $400,000
$400,000 – $25,000 = $375,000
$375,000 x 0.1% = $375

TOIP is paid annually by 30 September of each year.

Rental Tax

There is a 10% rental tax on residential property owned by a foreign investor and leased to a tenant.

The tax is calculated on the gross rental amount, which is the total amount of rent paid by the tenant each year.

Example: A condo is leased for US$2,000 gross rent per month.

$2,000 x 12 = $24,000
Annual rental tax = $24,000 x 10% = $2,400

Capital Gains Tax

There are currently no capital gains taxes on residential property sales in Cambodia. This means that investors who sell their condos at a profit will not have to pay any taxes on the sale.

A capital gains tax of 20% of the profits has been delayed by the Cambodian Government for a third time until end of 2024, and is expected to be delayed again due to the government’s desire to support economic growth in the post-pandemic era.

Double Taxation Agreements (DTAs)

Cambodia has signed DTAs with several countries to avoid double taxation. These agreements provide relief from paying taxes twice on income from property investments for residents of countries with which Cambodia has established DTAs.

It is advisable to consult with a tax professional or refer to the specific DTA provisions between Cambodia and the investor’s home country to find out if a DTA would apply.

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