Prakas on Tax Rules and Procedures for Trust

Who it binds

Trusts, trustees and the tax treatment of trust transactions in Cambodia.

What it requires

• Income tax on the taxable income of legal persons applies at 20 percent under Article 20 of the Law on Taxation, with a progressive scale for individuals.
• Trustee fees are treated as ordinary deductible business expenses under standard Cambodian tax principles — there is no separate rate applied to them.
• Where after-tax income is remitted to a non-resident taxpayer, the trustee must record the remittance and pay withholding tax of 14 percent on the transaction.

What it does not cover

The limits of an instrument decide whether it applies to you, and are rarely published. These are stated from the instrument itself.

• Whether a particular structure is a trust at all, or the licensing of trustees — both belong to the Law on Trust and the Trust Regulator.
• Trustee conduct standards, which are Prakas 004.
• Capital gains, which are dealt with separately under Prakas 496 and 1130.
• Any advice on how a specific arrangement should be treated. Tax positions are reserved work for a licensed tax agent, and this page is not one.

Sources

• Cambodia Issues New Tax Rules for Trust OperationsTilleke & Gibbins · professional legal commentary

Related

• NS/RKM/0119/002 — Law on Trust
• 004 — Prakas on the Code of Professional Ethics for Trustees
• 1130 MEF.Prk.GDT (superseding 496 MEF.PRK) — Prakas on Capital Gains Tax