If you run a registered business in Cambodia, you pay the patent tax every year. It is an annual business registration tax administered by the General Department of Taxation (GDT), and it applies to every registered business, local or foreign-owned.
Upon payment, your business receives a Patent Tax Certificate, which serves as proof that your business is licensed to operate. You will be asked for it when renewing licenses, opening or maintaining bank accounts, and during due diligence for any investment or acquisition.
The amount is fixed by your taxpayer classification rather than your profits. However, the calculation is not always one payment.
The tax applies per business activity and per location, which is where businesses with several lines of business or branches often miscount.
Understanding patent tax in Cambodia
The patent tax accompanies your tax registration under Prakas No. 193 MEF.PrK, which sets the rules and procedures for its collection.
Once paid, the GDT issues the Patent Tax Certificate, and you must display it at your principal place of business.
The certificate also has to reflect reality. If your business relocates, restructures, or closes, you need to report the change to the GDT. Keeping the certificate current is worth the small effort, because an unpaid or outdated patent tax tends to surface at bad times, such as during a license renewal or a bank's annual review.
The deadline for patent tax payment is March 31 each year.
Who Needs to Pay Patent Tax?
It is a mandatory requirement for all businesses, local and foreign, to pay Patent Tax in Cambodia. Legal entities required to pay include:
- Sole proprietorships, partnerships,
- Foreign-owned businesses registered in Cambodia
- Branches and representative offices of foreign companies
In certain situations, businesses are required to register for more than one Patent Tax Certificate. This includes those with:
- Different business activities: A company running import-export, transportation, and hotel operations pays patent tax on each line of business. Three activities means three certificates.
- Unrelated activities, even at the same address: A taxpayer operating a law firm and a laundry shop side by side pays for each, since the activities are unrelated.
- The same activity in different locations: A retail chain with shops in several provinces pays patent tax for each branch location.
- Separate enterprises under the same ownership: Two registered companies with different names and registration numbers each pay their own patent tax, even with an identical owner.
However, there are two instances where you will only have to pay this tax once:
- When business activities are related or ancillary, fall under the direct management of the same taxpayer, and are located within the same premises or compound.
- The business engages in only one type of business activity at a single location.
Essentially, if the operations are part of a unified enterprise, managed and operated from the same place, then only one Patent Tax payment is required.
Patent tax rates in Cambodia
The amount depends on your taxpayer classification under the self-assessment regime. The GDT assigns the class based on your legal form, turnover, sector, and assets, under Prakas No. 009 on the reclassification of taxpayers.
| Taxpayer class | Annual patent tax per activity | Approximate USD |
|---|---|---|
| Small taxpayer | KHR 400,000 | ~USD 100 |
| Medium taxpayer | KHR 1,200,000 | ~USD 300 |
| Large taxpayer (turnover up to KHR 10 billion) | KHR 3,000,000 | ~USD 750 |
| Large taxpayer (turnover above KHR 10 billion) | KHR 5,000,000 | ~USD 1,250 |
If your company is foreign-owned, the small taxpayer rate does not apply to you. Incorporated entities and representative offices are classified at least as medium taxpayers. Furthermore, branches of foreign companies and QIP-approved projects are classified as large taxpayers regardless of turnover.
How to calculate your patent tax
The patent tax in Cambodia is calculated as per the following:
Patent Tax Payable = (Base Rate per Business Location) x (Number of Activities or Branches) + Additional Provincial Branch Fee (if applicable)
The tax is paid for each business activity and for each location. There is no separate branch surcharge; a branch simply pays the applicable class rate again. For instance, if you are a medium taxpayer with one shop in Phnom Penh and a second in Siem Reap running the same retail activity, you pay KHR 1,200,000 for each location. That comes to KHR 2,400,000 in total, around USD 600.
Your start date affects the first year's amount. A business registered in the first half of the year pays the full annual amount for that year. If you register after June 30, you pay half. After the first year, the tax is renewed in full every year by March 31.
How to file and pay the patent tax
Renewal runs annually, with payment due by March 31. You can file and pay through the GDT's e-Tax services, through the GDT's partner banks, or in person at your tax branch. For a first registration or a renewal, the documentation typically includes:
- Certificate of incorporation and the Taxpayer Identification Number (TIN)
- Lease agreement or property ownership certificate for the business address
- The completed patent tax declaration and payment of the fee
- Identification documents for shareholders, and translated, notarized documents where applicable
- A power of attorney or board authorization where a representative or tax agent files on the company's behalf
Missing the deadline results in administrative penalties. An expired certificate can also hold up license renewals and raise questions during bank reviews, so treat March 31 as a fixed date in your compliance calendar.
Handling the patent tax with Emerhub
If you operate in Cambodia, Emerhub can manage the patent tax and relevant accounting cycle for you. Our team confirms your correct classification and rate, prepares and files the declarations, and renews your certificates before the March deadline each year. If your business runs several activities or locations, we also map out how many certificates you need, so nothing is missed as the business grows.
Talk to our Cambodia team about your setup, and we will tell you exactly what your structure owes and when.
Frequently asked questions
What is the legal basis for the Patent Tax in Cambodia?
The rules and procedures for collecting the patent tax are set out in Prakas No. 193 MEF.PrK dated March 26, 2021, issued by the Ministry of Economy and Finance and administered by the General Department of Taxation. Taxpayer classifications follow Prakas No. 009 dated January 12, 2021.
What happens if I lose my patent tax certificate?
You can request a replacement from your local tax branch, but you may need to show proof of payment and identification.
Do I still need to pay Patent Tax in Cambodia if I close my business mid-year?
The patent tax for that year remains payable, and the business must formally deregister with the GDT to stop future obligations from accruing.
Do I pay separately for a branch in another province?
Yes. The tax is paid per business activity and per location, so each branch pays the applicable class rate for its activity. A warehouse or workplace serving the same business at the same locality does not trigger a separate payment.
Do foreign-owned businesses pay different rates?
The rates are the same for local and foreign-owned entities within each class. The difference is the classification itself: foreign-owned incorporated entities are at least medium taxpayers, and branches of foreign companies are classified as large.
When is the patent tax due?
By March 31 each year for renewals. A new business pays at registration: the full annual amount if it starts in the first half of the year, and half the amount if it starts after June 30.