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On June 22, 2020, the General Administration of Taxation ("GDT") issued Document No. 15301, which provides VAT implementation guidelines for companies disposing of tangible fixed assets in Cambodia. In this article, we have provided a summary of Document 15301, hoping to be helpful to everyone.

On June 22, 2020, the General Administration of Taxation ("GDT") issued Document No. 15301, which provides VAT implementation guidelines for companies disposing of tangible fixed assets in Cambodia. In this article, we have provided a summary of Document 15301, hoping to be helpful to everyone.

According to the 15301 document, any enterprise that disposes of tangible fixed assets, regardless of whether the enterprise applies for VAT input credit when purchasing tangible fixed assets, must pay 10% VAT at the time of sale. VAT disposal includes donating or selling tangible fixed assets at prices below market value. Corporate restructuring is usually exempt from value-added tax.

For tangible fixed assets that an enterprise ceases to use in its business, if the enterprise initially applies for a VAT input credit when acquiring the tangible fixed asset, the enterprise must pay 10% of the value-added tax based on its fair market value. If an enterprise does not apply for an input credit when purchasing a tangible fixed asset, the enterprise does not need to pay 10% value-added tax when the tangible fixed asset is ceased to be used in the enterprise. When a tangible fixed asset is kept by the enterprise but is no longer used to contribute to the output of the enterprise, the tangible fixed asset is deemed to have ceased to be used.

According to the VAT regulations, companies engaged in non-taxable supplies and companies that cannot apply for VAT input credit when acquiring tangible fixed assets are still required to pay 10% VAT when selling these tangible fixed assets, but There is no need to pay when you stop using tangible fixed assets.

As always, the team of Zhuozhi (Cambodia) Accounting Firm is always ready to answer any questions you have about this tax issue and other tax issues.

A Cambodian chartered tax agent needs to be licensed by the Cambodian government. The license number of our Cambodian tax agent is TA202005001.