2024 annual compliance requirements for Cambodian businesses.

As 2024 draws to a close, it is important to review your annual compliance obligations to ensure they have been properly met, thereby avoiding any potential negative repercussions. Below are the typical annual compliance requirements for your reference and consideration:

Annual tax compliance

Annual tax on income/corporate income tax return for 2024

Entities classified as large or medium taxpayers are generally subject to a 20% Tax on Income (TOI) based on their net taxable profit, which is determined by adjusting the accounting profit. This involves adjusting expenses that are not allowed or limited, along with any taxable income that should be recognised in the current year but not included in the annual accounting profit.

When preparing the 2024 TOI return, it’s essential to consider the following common tax issues and take necessary actions:

• Unearned or deferred income
• Tax expenses paid on behalf of suppliers or employees
• Differences between accounting depreciation and tax depreciation
• Salary and related party payables
• Provision expenses
• Interest expenses
• Utilisation of tax losses or tax credits, etc.

The TOI return for 2024 must be submitted by March 31, 2025, and the corresponding tax payment is also due at that time. The General Department of Taxation will impose penalties and interest for late submissions of the TOI return and any delayed tax payment. We recommend engaging Acclime within the next two months to ensure a timely preparation and filing of the ToI return for the 2024 year.

Annual patent tax for 2025

The Patent Tax is a business registration fee that must be paid annually by March 31. The deadline for the 2025 patent tax payment is March 31, 2025. If a business engages in multiple types of activities, a separate patent tax payment is required for each activity.

The patent tax amounts are as follows:

• Small taxpayer: KHR 400,000 (~USD 100)
• Medium taxpayer: KHR 1,200,000 (~USD 300)
• Large taxpayer: KHR 3,000,000 (~USD 750) or KHR 5,000,000 (~USD 1,250) if the annual turnover exceeds KHR 10,000,000,000 (~USD 2,500,000).

Acclime can help ensure that your company pays the appropriate patent tax for 2025 by the March 31 deadline. We recommend completing the payment early in 2025 to avoid missing the deadline.

Submission of 2024 financial statements to the accounting and auditing regulator

All entities (excluding small taxpayers) that are not required to undergo an independent financial audit must submit their annual financial statements to the Accounting and Auditing Regulator (ACAR) by April 15, 2025. However, since April 12 and 13 falls on weekends and April 14 – 16 are public holidays (Khmer New Year), the new deadline will be April 20, 2025.

For entities that do require an independent financial audit, the annual audited financial statements must be submitted to ACAR by July 15, 2025.

Acclime can assist your company in preparing and submitting the financial statements to ACAR by the aforementioned deadlines to avoid any penalties.

Annual declaration of commercial enterprise

The Annual Declaration of Commercial Enterprise (ADCE) is a compulsory requirement for all commercial entities registered in Cambodia. It plays a vital role for the Ministry of Commerce (MOC) in keeping accurate and current information about the legal entities in the country.

To simplify the ADCE filing process, the MOC has introduced an online system that allows companies to submit their declarations electronically. This digital method improves convenience and efficiency, thereby minimising the administrative workload for businesses.

The deadline for filing the ADCE is within three months of the 12th month following the enterprise’s incorporation date. This schedule ensures the MOC receives updated information regularly, facilitating effective monitoring and analysis of business activities. If the ADCE is not filed within the specified timeframe, a penalty of KHR 2 million (~ USD 500) will be imposed for each year of non-compliance.

Although the online system provides regular reminders of the due date for ADCE filing, we advise all entities registered with the MOC to remain vigilant and file their ADCEs on time to avoid penalties. If you require assistance with this process, please reach out to us at Acclime.

2024 certificate of compliance for qualified investment project

Entities classified as Qualified Investment Projects (QIPs) typically receive duty-free import privileges and tax holiday incentives. To maintain these benefits, a QIP must adhere to all applicable laws and regulations; failing to do so may result in the loss of its QIP status.

The annual Certificate of Compliance (COC) is a document that verifies a QIP’s adherence to the relevant laws and regulations, issued by the Council for the Development of Cambodia (CDC) or the Municipal-Provincial Investment Sub-Committee (MPISC) in the following year.

In practice, if there are instances of non-compliance, the CDC or MPISC usually allows the QIP to address the issues and complete any outstanding requirements (such as submitting additional documents or requesting missing COCs from previous years) instead of immediately revoking its QIP status. Despite this understanding, we strongly advise QIPs to obtain their COC within the designated timeline to mitigate the risk of losing their QIP status. Acclime can assist with the annual preparation of the COC request.

Renewal of foreign work permit for 2025

The application period for the 2025 foreign employee quota is now open and will close on November 30, 2025. Businesses that currently employ or plan to hire foreign nationals in Cambodia for 2025 must apply for a foreign employee quota from the Ministry of Labor and Vocational Training (MLVT).

Employers are allowed to have foreign nationals comprise a maximum of 10% of their total local workforce. However, they can request an additional quota beyond this limit if they can prove a shortage of qualified Cambodian workers for specific roles.

Once the MLVT approves the quota, the foreign employee can apply for a work permit through their employer. This work permit is valid until the end of the calendar year and must be renewed by March 31 of the following year. In recent times, the Cambodian government has been enforcing employment laws regarding foreign nationals more stringently. Employers found hiring foreign workers without a valid work permit may face fines and/or imprisonment, while the Ministry of Interior may also expel foreigners working illegally.

Employers should be aware that the process for obtaining a Cambodian work permit can be complicated and time-consuming. Therefore, it is advisable to begin the application process as early as possible to avoid any delays. If you require assistance with this process, please reach out to us at Acclime.