By Simon Burlinson
Bio:
Simon is an English-qualified solicitor with extensive experience advising local, regional and international clients on cross-border corporate transactions, corporate restructurings, foreign direct investment in Cambodia and the tax structuring and compliance issues related thereto. Simon’s particular areas of expertise include advising international clients in the pharmaceutical, telecommunications, IP/IT, insurance, petrochemical and plant and seed breeding ACsectors on all aspects of local law compliance. He speaks English and French.
The Ministry of Economy and Finance issued Notification No. 039, dated 21 July 2016 on Visiting Enterprises to Collect Enterprises’ Information in Phnom Penh to Justify Tax Registration (“Notification 039”). Pursuant to Notification No. 039, an appointed working group, consisting of representatives from the General Department of Taxation (“GDT”) and the Phnom Penh Municipality (“Working Group”) will begin to collect information from all enterprises in Phnom Penh starting from August 2016 onwards. The GDT has announced that this collection of information by the Working Group will not affect the enterprises’ operation of their business activities.
The purposes of Notification 039 are to collect an enterprise’s statistics, raise some questions if necessary related to the information provided (such as its identity and activities and others necessary information to improve the investment environment in Cambodia) and to encourage the development of tax policy, dissemination of tax-related information, tax registration services and other tax services.
The intention of the GDT and MEF is to update the records the authorities currently hold and to bolster the implementation of Prakas No. 496 on Tax Registration, which essentially repealed and replaced Prakas No. 1139. (Click this page for more detail on these two Prakas).
Under Notification 039 all enterprise owners are requested to prepare a copy of the following basic documents prior to the working group’s visit:
For enterprises already registered with the GDT:
- Patent Tax Certificate (most recent year) and VAT certificate;
- Annual tax return/payment receipt (most recent year) and monthly tax return/payment receipt (most recent month); and
- Water bill and electricity bill (most recent month).
For enterprises not yet registered with the GDT:
- Khmer identification card or passport or family book or residence book of the enterprise owner(s);
- Business permission certificate issued by the competent authorities (if available);
- Other licenses (if available);
- Immovable property ownership certificate or leasing agreement of the location and receipt of tax payment on immovable property; and
- Water bill and electricity bill (latest month).
It is expected that the GDT will give enterprises from (2) two to four (4) weeks prior notice of the Working Group’s visitation.
Ostensibly, the purpose of Notification 039 is to check which enterprises have complied with the re-registration obligations pursuant to Prakas 496 and to ensure that each enterprise has fulfilled its tax filing obligations.
While there has been no indication as to when this initiative will be completed, enterprises should expect further measures for enforcement of compliance based on the findings of the Working Group.
Sciaroni & Associates Taxation Practice Group offers a full range of tax compliance, advisory and dispute resolution services, from the filing of monthly and annual tax returns and patent tax filings, tax registrations and structuring advice to conducting due diligence in corporate transactions and assisting clients with disputes involving the tax authorities. We advise many of our clients on tax optimization strategies and assist them during tax audits. At every stage of a company’s life, our advisers ensure clients are fully compliant with the dynamic field of taxation in Cambodia. . To our local clients we bring international standards of professional service and to our international clients we merge our understanding of local compliance and legislative practices with quality of service and financial information required for global business.
Sciaroni & Associates, one of Southeast Asia’s leading professional services and investment advisory firms, has been providing skilled counsel and knowledgeable business insights for over two decades. Based in Cambodia with legal offices in Laos and Myanmar, our experienced team of advisors brings considerable general and sector-specific expertise to the challenges confronting companies doing business in emerging markets. We are proud that our clients comprise many of the world’s premier companies, banks, financial institutions, governments and global development organizations.
For more information please visit www.sa-asia.com or contact us at [email protected].
