The self-assessment regime taxpayers who are making taxable supplies are obliged to register for VAT, and collect VAT from the supplying of goods or services to their customers. The term “good” means tangible property other than land or money. The term “service” means the provisions of something of value other than goods, land, or money.
The term taxable supply means:
- The supply of goods or services by a taxable person in the Kingdom of Cambodia. The taxable person is any taxpayer under the Real Regime Tax System and others as specified by regulations;
- The appropriation of goods for his own use by a taxable person;
- The making of gift or supply at below cost of goods or services by a taxable person;
- The import of goods into the customs territory of the Kingdom of Cambodia.
Non-taxable supplies are as follows:
- Public postal service;
- Hospital, clinic, medical, and dental services and the sale of medical and dental goods incidental to the performance of such services;
- The service of transport of passengers by wholly state owned public transportation system;
- Insurance services;
- Primary financial services;
- The imports of articles for personal use that are exempted from customs duties;
- Non-profit activities in the public interest;
- The imports or the purchases of goods for use in the exercise of their official function of foreign diplomatic and consular missions, international organizations and agencies of technical cooperation of other governments.
Rates of tax
The rates of VAT are as follows:
- 0% This rate applies only to goods exported from the Kingdom of Cambodia and services consumed outside Cambodia. Exports are defined as including international transportation of passengers and goods.
- 10% This standard rate applies to all supplies other than exports and non-taxable supplies.
Calculation of tax due
- The VAT paid on import of goods or the VAT on locally purchase of goods or services for the business is called “Input Tax”.
- The VAT charged on supplying of goods or services to customers is called “Output Tax”.
- VAT due = Output Tax – Input Tax.
Non-deductible Input Tax
Non-deductible input tax are the VAT paid on:
- Entertainment, amusement and recreation expense unless the taxable person carries on a business as a provider of entertainment, amusement or recreation;
- Purchases or imports of automobiles, unless the taxable person carries on the business of dealing in, or hiring such automobiles; or
- Purchases or imports of certain petroleum products, unless the taxable person carries on the business as a supplier of such petroleum products.
The taxable person must file the monthly VAT return in the form prescribed by the tax administration by the 20th of the month following the month that the supplies have been made.