Cambodia: New annual taxable income, monthly taxable salary thresholds for individuals
Effective from 1 January 2023 onwards, there will be new thresholds for determining taxable income for individuals
Effective from 1 January 2023 onwards, there will be new thresholds for individuals
Effective from 1 January 2023 onwards, there will be new thresholds for determining taxable income realised by a physical person, sole proprietorship or distributions to each member of a partnership subject to tax on income (ToI), as well as for determining monthly taxable salary received by the resident employees subject to tax on salary (ToS).
The new thresholds of income subject to annual ToI are as follows:
| No. | Threshold of income subject to annual tax (Riel) | Tax rate |
| 1 | From 0 to 18,000,000 | 0% |
| 2 | From 18,000,001 to 24,000,000 | 5% |
| 3 | From 24,000,001 to 102,000,000 | 10% |
| 4 | From 102,000,001 to 150,000,000 | 15% |
| 5 | Over 150,000,000 | 20% |
The new thresholds of monthly taxable salary received by resident employees subject to ToS are as follows:
| No. | Threshold of income subject to annual tax (Riel) | Tax rate |
| 1 | From 0 to 1,500,000 | 0% |
| 2 | From 1,500,001 to 2,000,000 | 5% |
| 3 | From 2,000,001 to 8,500,000 | 10% |
| 4 | From 8,500,001 to 12,500,000 | 15% |
| 5 | Over 12,500,000 | 20% |
KPMG observation
The new sub-decree further increases the threshold for taxable salary subject to the 0% ToS rate by approximately $50 USD, which would be favorable for workers, especially those earning minimum wage rates.
The new sub-decree also adjusts the threshold for taxable income subject to ToI earned by individuals, which appears to reinforce the previous intention of the government to implement a new individual (personal) income tax regime in Cambodia. However, it remains to be seen as to how and when this intention will come to fruition as there has been no mechanism or guidelines issued yet regarding a new individual income tax regime.
Read an October 2022 report [PDF 152 KB] prepared by the KPMG member firm in Cambodia
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