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Employing in Cambodia

At a glance

Employment in Cambodia

Foreign companies that employ workers in Cambodia face several challenges and must adhere to the legal and regulatory framework that is in place. The Labour Law has only recently been adapted to facilitate the deployment of foreign workers to Cambodia. In some cases, using an outsourced employer will make the process smoother, and it is recommended to use professional legal services as well. Our guide explains Cambodian policies on leave, termination and payment of benefits.

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Payroll & Tax in Cambodia

Complying with local payroll and tax requirements is essential for a company doing business in Cambodia. Issues such as tax rates and withholding and social security are all essential in ensuring a seamless human resources operation. Many companies will consider outsourcing these administrative tasks to a GEO (Global Employment Organization).

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Immigration / Work Permits in Cambodia

Foreign workers are required to have the proper visas and work permits in Cambodia, as established by immigration laws. This often requires incorporation and licensing prior to sponsoring work permits for employees, which can be a problem if your company is trying to enter the country quickly.

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Incorporation

There are several business structures available for incorporation in Cambodia – the representative office, branch, and wholly foreign owned subsidiary – and each has advantages and disadvantages. In some cases it will depend upon the type of industry that you are in, and the scope of planned business activity. Our guide has a a comparison of the time and cost for incorporating standard company structures including Rep Office, WFOE and branch.

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GEO Solutions or DIY Employment in Cambodia?

Companies entering Cambodia must make a decision whether to use their own resources for a Do-It-Yourself (DIY) approach, or to use a Global Employment Organization to handle payroll and employment responsibilities. A GEO or Cambodian Employer of Record solution makes it faster, easier and cheaper to deploy staff if they don’t have a Cambodian entity established that can run payroll.

A DIY approach will typically take 6-9 months until there is a properly incorporated WFOE ready to run payroll and cost up to 6 figures if registered capital is required. Shield GEO can deploy foreign staff in 4-6 weeks and local staff in 48 hours. Additionally Shield GEO is responsible for all compliance issues related to the employment.

Using Shield GEO Employer of Record Services in Cambodia

Payroll Cambodia
Management Fee for Employer of Record Services / Monthly Payroll Costs

Please contact us for a quote

Notes

Shield GEO pays the employee on a monthly basis, typically on the last working day of the month although we can adapt to your preferred schedule. Income tax and social security (where applicable) are deducted at source and paid to the local tax authorities.

 
Grossed income Tax Rate (%)
KHR 0 – 500,000 0%
KHR 500,001 – 1,250,000 5%
KHR 1,250,001 – 8,500,000 10%
KHR 8,500,001 – 12,500,000 15%
KHR 12,500,001 and above 20%

Non-residents are taxed a flat rate of 20% on all Cambodian-sourced income.

Tax Returns Supplied

Yes, Shield GEO can organise tax returns in this country.

Employers Social Security and statutory contributions

Employers are required to contribute 0.8% of the average monthly wage of workers to the National Social Security Fund (NSSF).

Employees Social Security and statutory contributions

Employees do not make any contribution to the NSSF.

Corporate Income Tax Rate

20%, with the exception of mining companies (taxed at 30%), and insurance gross premiums (taxed at 5%).

Payroll Tax

N/A

Sales Tax

10% VAT

Withholding Tax

Withholding taxes include the following:
• Payment for services to a physical person: 15%
• Payments of royalties for intangible assets and interests in minerals, oil, or natural gas: 15%
• Interest payments: various rates depending on the recipient
• Income from rental or moveable or immovable property: 10%

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