A lot of foreign businesses are taking an interest in the Kingdom of Cambodia due to its attractive investment environment. As such, local entrepreneurs have thrown in their lot to set up real estate companies to meet the demands of both fellow Cambodians and foreigners. But setting up a real estate company is easier said than done.
Investors looking to start a real estate agency in Cambodia will need to consider things such as company registration, tax obligations, real estate licenses, office setups, recruitment, and business plans.
For the purposes of this guide, we will specifically talk about how to start a real estate agency in Cambodia.
Registration with the Ministry of Commerce
Business registration is required at the Ministry of Commerce of the Kingdom of Cambodia. Registered businesses within the Kingdom are given a certificate of registration.
The company must meet these following requirements from the Ministry of Commerce:
Shall define a company name to be approved by the Ministry of Commerce
Shall come up with the company’s terms and conditions, documents to prove where the company is located, identity card of the company owner, certificate of bank deposit (at least $1,000), company stamp, appointment letter, and business registration application.
The registration period at the Ministry of Commerce takes about two weeks and costs around $370. There are services rendered free of charge.
Paying taxes at the General Department of Taxation
After registering with the Ministry of Commerce, the applicant must submit the certificate of registration, along with other relevant documents, to the general Department of Taxation to pay their registration tax and annual patent tax for the initial registration.
Patent Tax is derived from the taxpayer classification of the business owner under the Self-Assessment Regime of Taxation and is payable between January 1 to March 31 of each year. We advise consulting a lawyer on how you can properly assess your taxation regime to start a business in Cambodia.
New taxpayers, whose business began within the first six months of the year will pay their annual tax in full. Those who begin their business within the last six months of the year will only have to pay half of their annual tax.
Business owners who own several assets (such as warehouses, offices, etc) under one business in the same province only have to pay their patent tax within that province. Businesses who own assets across provinces will, however, have to meet their patent tax obligations in each province.
Business owners are required to display the patent at their place of business. These patents take about 1 to 2 weeks to obtain and will cost 1,200,000 riels (US$290).
Obtaining a license from the Ministry of Economy and Finance.
The last general step is to obtain a license from the Ministry of Economy and Finance. In order to apply for a license, the applicant must prepare the following documents:
Completed application license form
Photo of the license owner and certificate of professional real estate service
Background of shareholder or company owner
Letter from the Ministry of Justice of Cambodia
Photocopy of a national identity card and residence book
Documents issued by the Ministry of Commerce and Taxation, the company’s certificate of registration, and a copy of a letter of business registration and patent.
Letter of business location issued by the local authority, together with photos of the business location.
A 3-year business plan.
Applying for a license at the Ministry of Economy and Finance takes about one month from the date of filing the sufficient paperwork without error.
The required fees for a real estate agent license are as follows:
Real estate agent license is 500,000 riels (US $120) plus an administration fee of 100,000 riels (US $25)
Certificate of professional real estate service is 200,000 riels (US$ 50) plus an administration fee of 40,000 riels (US$ 10), totaling 840,000 riels (US$ 210).
Once you have been issued a license and professional certificate from the Ministry of Economy and Finance, you can legally operate your business in Cambodia.
You can register to be a member of the Cambodian Valuers and Estate Agents Association. Currently, CVEA has over 100 member companies, working as a network to promote real estate in Cambodia.
Source: Khmer Times