Tax audits in Cambodia.

The General Department of Taxation (GDT) in Cambodia conducts three types of tax audits to verify compliance with tax obligations: desk audits, limited audits and comprehensive audits. Each type differs in scope, procedures and documentation requirements. Understanding these differences can help businesses prepare appropriate documentation, respond effectively during the audit process and reduce the risk of penalties.

This overview covers the scope, procedures and requirements for each audit type, along with what your business can expect when the GDT initiates an audit.

Types of tax audits in Cambodia

There are three types of tax audits in Cambodia: a desk tax audit, a limited tax audit and a comprehensive tax audit.

Desk tax audit

A desk audit is a basic review conducted by tax officials at the GDT office, without visiting the taxpayer’s premises. Desk audits can be carried out within 12 months after the submission of tax returns.

It focuses on verifying the accuracy and consistency of submitted tax returns and supporting documents. The GDT may request clarifications, additional documents or explanations from the taxpayer.

Desk audits often cover a single tax period or tax type, such as VAT, salary tax or withholding tax (WHT). They aim to identify some discrepancies that can be resolved quickly without a full-scale investigation.

If selected for a desk audit, the taxpayer will receive a written notification from the GDT specifying the tax period and the nature of the information required. The taxpayer needs to respond within the timeframe, usually 10 to 15 working days, by providing the requested documents or clarifications.

Limited tax audit

A limited audit involves a thorough examination of a taxpayer’s compliance with monthly tax obligations. The limited tax audit can be conducted for the current tax year (N) and the preceding tax year (N-1).

Unlike a desk audit, which is conducted entirely off-site, a limited audit may include an on-site visit by tax officials to review relevant documents and procedures, such as tax returns, accounting records and business activities.

Limited audits are generally less intrusive than comprehensive audits but more thorough than desk audits. They aim to verify the accuracy of certain tax filings and assess whether the taxpayer has correctly applied the law to specific areas of their business.

During the audit, the tax officers may request supporting documentation such as invoices, payment vouchers, payroll records, tax return schedules and bank statements. If discrepancies are found and the taxpayer is unable to explain the discrepancies, the penalties (additional tax and interest) will be imposed. In some cases, findings from a limited tax audit may be a factor that the GDT considers when deciding whether to conduct a comprehensive audit of the taxpayer.

Comprehensive tax audit

A comprehensive audit involves a detailed and thorough review of a company’s financial and tax records by the GDT. This audit often applies to medium and large taxpayers, foreign-invested entities and businesses in sectors considered high-risk. In 2024, the GDT established a Special Tax Audit Unit (STAU), with the specific mandate of conducting comprehensive audits on taxpayers holding gold compliance status and other enterprises as identified through a committee to be established by the GDT.

A comprehensive audit primarily focuses on Tax on Income (TOI) but may cover all types of taxes if no previous reassessment has been conducted, for the current tax year and the preceding three years (N-3). If there is concrete evidence of tax evasion, or if losses or tax credits carried forward from previous years need to be verified, the tax audit may be extended to cover the preceding five tax years (N-5).

Unlike desk or limited audits, comprehensive audits usually involve an on-site visit by tax auditors and a close examination of source documents, accounting records and internal controls.

Documents required for a tax audit

The primary documents that are required for on-site tax audit include:

1. Enterprise information
2. Management structure
3. Certificate of Registration
4. VAT Certificate
5. Articles of Incorporation
6. Other business certificates from authorities, such as the Council for the Development of Cambodia, the Ministry of Tourism, etc.
7. Accounting documents
   1. Financial statements
   2. Detailed list of each account of assets, owners’ equity and liabilities
   3. Detailed list of each account of income statement (profit/loss)
   4. Original voucher of documents such as:
      • Monthly payroll
      • Employment contract of foreign staff and managers
      • Lease or sale contracts
      • Bidding contract, if any
      • Monthly and annual tax returns
      • Monthly purchase-sale journals
      • Table of adjusted tax calculation
      • Purchase and sale invoices

How often are companies audited?

Taxpayers are subject to being audited based on the criteria of risk analysis as selected by the tax authorities.

For taxpayers who obtain tax compliance status, the timeframes for being audited are as follows:

• Gold status companies (16-20 points) are subject to one comprehensive tax audit every two years and will not need to undergo a limited audit or desk tax audit.
• Silver status companies (11-15 points) are subject to one comprehensive tax audit every two years, a limited tax audit every year and no desk tax audit.
• Bronze status companies (1–10 points) receive a tax compliance certificate valid for two years but do not benefit from exemptions to limited or desk tax audits.

What happens if a monthly filing is missed?

Missing a monthly tax return in Cambodia results in immediate penalties. The GDT treats the failure to file as a compliance breach. The taxpayer shall be subject to a penalty of KHR 5,000,000 for failing to file a nil return provided that the nil return has still not been filed after receiving the second official notification from the GDT.

Filing deadlines

Monthly returns for VAT, salary tax, withholding tax and prepayment of tax on income are due by the 20th of the following month or the 25th for e-filing.

Penalties and interest

Under Cambodia’s Law on Taxation, the GDT may impose an additional tax at the following rates:

• 10% for ordinary negligence (e.g. missed deadlines or ≤10% tax shortfall)
• 25% for serious negligence (>10% tax shortfall)
• 40% for unilateral tax reassessment, typically due to non-cooperation

Interest accrues at 1.5% per month on any outstanding tax from the due date until settlement. Administrative fines of up to KHR 10,000,000 may also apply for obstruction of tax provisions.

Impact on compliance status

Missed or late filings can reduce a taxpayer’s GDT compliance score and affect eligibility for gold or silver certificates. A downgrade can increase audit frequency and compliance burden. Maintaining a consistent filing record is therefore one of the most effective ways to protect compliance standing.

Can taxpayers request a delay of tax audit fieldwork?

Tax audit fieldwork will be conducted within 10 working days after taxpayers receive a Notice of Tax Audit (NTA). However, taxpayers can request a delay of up to 30 days based on a reasonable cause.

For an extension of less than 10 days, taxpayers may verbally request through a discussion with the tax auditor in charge.

For longer than 10 days up to 30 days, a written request is required.

Tax audit process

The GDT shall give an NTA to taxpayers or their representative about the tax audit, which contains the following:

• Taxpayers’ name, address and tax identification number
• Date of proposed audit fieldwork
• Period to be audited
• Type of audit
• Names of tax audit officers
• A list of required documents

Auditors may visit the taxpayers’ business premises, review documents, discuss with taxpayers any potential tax issues found and request additional documents to verify.

Taxpayers need to provide the required documents within seven days following the request. If documents are not provided, the tax auditor may reassess the taxes based on the available information and in accordance with law and regulations on taxation.

After completing an audit, a Notice of Tax Reassessment (NOTR) is issued. The NOTR, which will be sent to taxpayers or their representative, specifies the reassessed type of tax, the basis of the tax reassessment, additional tax and interest.

If the taxpayer agrees with the reassessed tax liabilities in the NOTR, the taxpayer can make the tax payment.

However, if the taxpayer disagrees with any part or the whole of the NOTR, the taxpayer has 30 working days after receiving the NOTR to submit an objection letter to the GDT. Upon submitting the objection letter, the GDT has 60 days to respond to the objection letter. The previously assigned tax auditors will work with the taxpayers to resolve the dispute.

A second objection letter can be submitted within 30 working days if the taxpayer still disagrees with the GDT’s decision. Auditors from the Litigation Law and Statistic Department will be assigned to work with the taxpayer on the second objection letter.

If the taxpayer still disagrees with the GDT’s second decision, the taxpayer can submit the objection letter to the Tax Arbitration Committee under the Ministry of Economy and Finance within 30 working days.

If the taxpayer disagrees with the Tax Arbitration Committee’s decision, the taxpayer may go to court, but currently, no specific court deals with tax audit disputes and going to court is a rare case.

Conclusion

Understanding the types of tax audits in Cambodia, desk, limited and comprehensive, is crucial for businesses to maintain compliance and effectively manage risks. Each audit type carries different levels of scrutiny, procedures and documentation requirements, and being well-prepared can significantly reduce the likelihood of disputes, penalties or escalations. By keeping accurate records, responding promptly to GDT requests and maintaining good compliance status, businesses can work through the audit process with greater confidence and safeguard their operations in Cambodia’s evolving tax environment.

For a broader overview of Cambodia’s tax system, refer to our guide on the introduction to taxation.

How Acclime can help with tax audits in Cambodia

Acclime Cambodia offers complete support related to tax audit preparation and compliance management for businesses operating in Cambodia. From audit readiness assessments to ongoing advisory support, our team of experts can assist with everything from reviewing and organising tax records to representing clients during audit interactions with the General Department of Taxation.

By partnering with us, local and foreign businesses can confidently face tax audit processes and minimise the risk of non-compliance. Contact us to learn more about how we can support your specific needs for audit preparation and compliance support.