The Ministry of Economy and Finance issued Notification no. 020 on the Stamp Duty Tax Exemption and Relief on the Transfer of Ownership or Possessory Rights of Real Estate for First-Time Home Buyers dated 31 December 2024 (“Notification no. 020“). Notification no. 020, issued pursuant to the directive from Samdech Thipadei Hun Manet, the Prime Minister of the Kingdom of Cambodia, aims at facilitating individuals who have purchased houses from residential development companies in the gated communities (commonly known as “Borey” in Cambodia) or condominiums and supporting the real estate sector. The tax incentives provided under Notification no. 020 will be in effect from 1 January 2025 to 31 December 2025.
These tax incentives are as follows:
1. Individuals who have purchased houses in the Borey or condominiums before 2025 and transfer the ownership or possessory rights in 2025 will receive the following tax incentives:
- Stamp duty tax exemption on houses that have value of under or equal to US$210,000;
- Stamp duty tax relief on houses that have value of more than US$210,000 by allowing a deduction of US$210,000 from the stamp duty tax base; and
- For the transfer of ownership or possessory rights of a second or subsequent house, a deduction of US$70,000 from the stamp duty tax base.
2. Individuals who have purchased houses in the Borey or condominiums in 2025 and have not yet received the stamp duty tax exemption and relief will also be eligible for the tax incentives outlined above.
In order to qualify for the exemption and relief mentioned above, the following conditions must be met:
- The houses in the Borey or condominiums must be acquired from a residential development company registered with the Real Estate Business and Pawnshop Regulator or the provincial department of economy and finance. This applies regardless of whether the title deed lists the name of the company or the natural person who is the project owner, or a representative of the company or project owner; and
- The value of a house in the Sale and Purchase Agreement (“SPA“) should be reflective of its market value. The SPA shall be submitted to the tax administration before or at the time of the transfer of ownership or possessory rights.
However, for houses purchased from a residential development company that does not have a licence, where the project owner is facing issues or bankruptcy, the transfer of ownership or possessory rights of such houses through a settlement mechanism by the relevant ministries or authorities will still qualify for the stated stamp duty tax exemption and relief.
If you have any queries on the above, please feel free to contact our team members below who will be happy to assist.
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