The Cambodian government has officially announced a further postponement of the 20% Capital Gains Tax (CGT) on immovable property, with implementation now deferred to 1 January 2027.
While this extension is welcomed by the property sector, it is important to note that capital gains tax on other forms of capital — including share transfers — remains scheduled to apply from 1 January 2026. This creates a differentiated CGT landscape that investors and businesses should carefully navigate over the coming years.
Key Developments at a Glance
- Real estate CGT deferred to 1 January 2027
Disposals of land and buildings by individuals will continue to fall outside the CGT regime for a further two years. - CGT on non-real-estate capital effective from 1 January 2026
Gains arising from the transfer of shares and other qualifying capital assets remain subject to CGT from 1 January 2026.
Implications for Share Transfers and Corporate Transactions
As set out in Prakas 496 on Capital Gains Tax that was issued on 18 July 2025 capital gains tax was to apply to the following types of Capital:
- Immovable Property (e.g. land, buildings)
- Leases and Subleases
- Investment Assets (e.g. including shares)
- Goodwill (e.g. brand, customer lists)
- Intellectual Property
- Foreign Currency
Unlike immovable property, investment assets/share transfers are not covered by the latest deferral. As a result, transactions involving the sale of shares — including M&A exits, internal group restructurings, and shareholder reorganisations — may attract CGT from 1 January 2026.
Key considerations include:
- Transaction structuring
Investors may need to reassess whether a direct asset sale or share sale remains optimal from a tax perspective. - Timing of exits and reorganisations
Planned share disposals scheduled around 2026 may benefit from early execution or alternative structuring. - Valuation and cost base documentation
Robust records supporting acquisition cost, capital improvements, and transactional expenses will be critical in determining taxable gains. - Interaction with other Cambodian taxes
CGT should be considered alongside existing taxes such as withholding tax, minimum tax, and transfer taxes, as well as any overseas tax obligations of foreign shareholders.
Policy Direction and Market Signal
The staggered implementation — deferring CGT for real estate while proceeding with taxation of share transfers — suggests a targeted policy approach. The government appears intent on supporting real estate market stability, while still advancing broader tax reform and revenue measures through the taxation of financial and corporate capital gains.
For investors, this reinforces that CGT is no longer a theoretical future concept, but an imminent compliance issue for corporate and investment transactions.
Preparing for 2026 and Beyond
Although real estate gains enjoy temporary relief, taxpayers should view the current period as a transition window. Businesses and investors with Cambodian exposure should be proactively reviewing:
- Planned share transfers, exits, and restructurings
- Holding structures involving property-rich companies
- Internal group reorganisations scheduled post-2025
- Readiness of accounting systems and tax documentation
Early planning will be essential to manage risk, avoid unexpected tax leakage, and ensure compliance once CGT on share transfers becomes operative.
Payment Timing and Expected Guidance
An important operational aspect of the capital gains tax regime is the payment deadline. Under the current framework, capital gains tax arising from share transfers is payable within 3 months from the date the capital gain is realised.
This relatively short payment window means that taxpayers involved in share disposals will need to address CGT considerations early in the transaction lifecycle, rather than treating tax as a post-completion issue. In practice, this may require:
- Early determination of whether a transaction gives rise to a taxable capital gain
- Advance preparation of acquisition cost, valuation support, and transaction expense documentation
- Cash-flow planning to ensure CGT can be settled within the prescribed 3 months period
At the same time, several practical and technical questions remain outstanding in relation to CGT on share transfers and other forms of capital. Market participants are currently awaiting further clarification on matters such as:
- The methodology for calculating taxable gains, including the treatment of historic cost, capital contributions, and transaction costs
- Declaration and filing procedures, including the form and supporting documentation required
- The interaction between CGT and other Cambodian taxes, particularly in cross-border transactions
- Compliance expectations for foreign sellers and offshore holding structures
We expect additional guidance to be issued over the coming months to address these issues and to provide greater certainty for taxpayers post the 1 January 2026 effective date.
Practical Takeaway
Until further guidance is released, taxpayers should adopt a conservative and well-documented approach to share transfers and other in-scope capital transactions. Early engagement on structuring, valuation, and compliance will be critical to managing risk and avoiding delays or disputes once the regime becomes fully operational.
We will continue to track developments closely and will provide updates as soon as further clarification becomes available.
Tax services required to be undertaken by a licensed tax agent in Cambodia are provided by Mekong Tax Services Co., Ltd, a member of DFDL and licensed as a Cambodian tax agent under license number – TA201701018.
