Tax Audit

Cambodia adopts “Self-Assessment System” meaning that all tax payer are under self-declaration, fully takes responsible on the amount of tax lodgment and ensure that their tax returns are truthful, correct and in compliance with tax law and regulations. Failure to do so, it could lead to non-compliance that result to tax reassessment.  

** What is Tax Audit :

Tax audit refers to the verification of accounting records, financial statements and othr documents related to the taxpayer’s business in order to ensure that the calculation, the declaration and the payment of taxes are correct in accordance with tax law and regulations.

After tax audit is completed, taxpayers will receive notification of tax reassessment from General Department of Taxation. Some of Taxpayer may receive the notification letter at Zero tax reassessment or reassessment with amount of tax payable which including tax, additional tax and interest).

** Common Issue in tax audits

  • Tax on Salary
  • Tax on Fring Benefit
  • Withholding tax
  • Value Added Tax
  • Service charge by head office
  • Unearned/Deferred revenue
  • Tax Loss
  • Registered Capital Vs. Booked Capital
  • Retained Earning
  • Expenses with no supporting documents
  • Expense cut-off
  • Depreciation
  • Provision
  • Transfer pricing

** Some note to avoid additional tax and interest

  • Follow current tax update on new Prakas, notification, new update tax law and regulations.
  • Maintain proper supporting documentation as required by the law, including transfer pricing document.
  • Perform double self-review before filling tax returns.
  • Good comply and truthful with tax law and regulation
  • Well cooperative throughout the tax audit field work
  • Maintain consistency in assigning staff or any agent to deal with tax auditors.