Gov't To Impose 20% of Capital Gain Tax in 2026: Here’s How to Navigate Real Estate Investments

Written By chheng leang

As Cambodia steps into a new regulatory era, the introduction of a 20% Capital Gains Tax (CGT) from 1 January 2026 marks an important milestone for the property market. For investors—especially those considering Phnom Penh’s condominium sector—understanding this change is essential for making strategic and profitable decisions.

Below is a clear, investor-focused breakdown of what this new tax means and how it may reshape opportunities in Cambodia’s fast-evolving real estate landscape.

What Is the 20% Capital Gains Tax?

Beginning January 2026, gains made from selling immovable property—including condominiums, buildings, and land—will be taxed at 20% of the net capital gain.

Investors may calculate gain using one of two methods:

  • Actual Cost Method: Gain = Selling Price – (Acquisition Cost + Improvement Costs + Transaction Fees) → Tax is 20% on that net gain.

  • Standard Deduction Method: 80% of the sale price is automatically deductible. → Only the remaining 20% is taxable.

This tax applies to both Cambodian nationals and foreigners, with exemptions for principal residences held for 5 years, inheritance transfers, and some family transfers.

How Will CGT Affect Condominium Investment?

1. Less Focus on Short-Term Flipping

Phnom Penh has seen phases of speculative purchasing, especially during the condo boom years. With CGT in place, quick resell strategies will become less attractive because a portion of the profit is taxed.

Investors will shift toward longer holding periods, prioritizing income stability over fast turnover.

2. More Emphasis on Rental Yield

Rental yield has always been a key strength of the condominium market—typically 6%–8% annually for well-located units.

In a CGT environment, rental income becomes the primary performance engine, especially for:

  • BKK1 luxury condos

  • Tonle Bassac serviced units

  • Chroy Changvar riverside projects

  • Toul Kork emerging premium clusters

The tax does not affect rental income calculations, so condos with strong occupancy and professional management will continue to perform well.

3. Stronger Demand for High-Quality Developers & Locations

With exit gains now taxed, investors will place even higher weight on:

  • Developer track record

  • Construction quality

  • Professional management

  • Building occupancy

  • Long-term rental demand

Prime zones like BKK1, Koh Pich, Tonle Bassac, and Chroy Changvar Peninsula will remain resilient due to consistent expatriate and local demand.

4. Possible Short-Term Market Adjustments

Before January 2026, some owners may accelerate sales to close deals before CGT becomes effective. After implementation, the market may briefly slow as buyers and sellers adjust expectations, but the medium-term outlook for quality condominiums remains solid.

5. More Professionalism and Transparency

CGT encourages:

  • Proper documentation

  • Accurate valuation

  • Cleaner transaction processes

  • Better compliance overall

This is healthy for the long-term maturity of Cambodia’s real estate sector and builds confidence for foreign investors.

What Should Investors Do?

✔ Focus on the Right Assets

Select condominiums with:

  • High rental demand

  • Strong management

  • Proven developers

  • Amenity-rich environments

  • Central or waterfront locations

✔ Think Long Term

Condos in Phnom Penh are best viewed as 5–10 year assets, built for yield, lifestyle value, and gradual appreciation.

✔ Document All Costs

Well-kept records reduce taxable gain and protect your return.

✔ Leverage Expert Guidance

With new tax implications, relying on professional advisory becomes even more crucial in choosing the right projects and structuring the right exit strategies.

Final Thoughts

Cambodia’s 20% Capital Gains Tax is not a barrier—it is a normalization of the investment environment. Markets across ASEAN have similar tax frameworks, and Cambodia is aligning with regional standards to ensure sustainability, transparency, and investor confidence.

For investors seeking rental income, long-term appreciation, and premium lifestyle assets, Phnom Penh’s condominium sector—especially luxury and riverfront residences—remains a compelling and strategic choice.

If you would like personalized guidance or investment analysis on Phnom Penh’s best condominium projects for 2026 and beyond, feel free to connect with me directly.

Contact for Advisory

For a confidential consultation, financial performance planning, or site tour, please reach out:

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chheng leang
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