Tax rates in Morocco

Company Tax

2023

Tax Rate For Foreign Companies

Moroccan tax applies territorially. Foreign companies are liable on Moroccan-sourced income, even when this is of an occasional nature, at the same rates as local companies (unless preferential treatment is granted under foreign investment schemes).
A branch tax of 15% applies to the net income transferred by the Moroccan branch to foreign entities.

Capital Gains Taxation

Capital gains are treated as non-current income and taxed at the normal corporate tax rate.
Non-resident companies are exempt from capital gains derived from the sale of stocks listed on the Casablanca stock exchange, excluding the shares of real estate entities.
For the years 2023, 2024 and 2025, companies will benefit from a 70% deduction on the net capital gain resulting from the sale of fixed assets, excluding land and buildings.

Main Allowable Deductions and Tax Credits

Expenses incurred in connection with business activities are generally deductible unless specifically excluded. Start-up expenses shall be capitalised and depreciated for tax purposes over a five-year period. Interest on loans granted by direct shareholders is deductible if the capital is fully paid in, limited to the share capital equity and the interest rate provided annually by the Ministry of Finance.

Charitable contributions made by companies are deductible only if they are granted to foundations and societies explicitly provided by law. In the case of contributions made to the community enterprise, the deduction is capped at 0.2% of the turnover.

Tax losses may be carried forward for a period of four years from the end of the loss-making accounting period. However, the portion of a loss that relates to depreciation may be carried forward indefinitely. The carryback of losses is not permitted. Foreign tax relief is provided for foreign-sourced income. Bad debts that are definitively non-recoverable are treated as deductible losses. Taxes are generally deductible (except for corporate income tax).

Morocco offers tax incentives in the form of tax exemption or taxation at more advantageous rates for local and foreign investors. Check the Corporate income tax section for further details.

Other Corporate Taxes

Registration duties between 1% to 6% are due on all written or verbal conventions, such as property transfer of real estate, shares, or rights; company set-up; equity increase; and goodwill transfer (6%). A flat rate of MAD 200 is also applicable to specific operations and conventions.The acquisition of real property is subject to a 1% real estate tax.

A municipal tax ("taxe de services communaux") is levied at a rate of 10.5% of the rental value of properties located in urban areas and 6.5% for properties located on the outskirts of cities.

The business tax ("taxe professionnelle") consists of a tax on the rental value of business premises (rented or owned) and fixed assets. The tax rates range from 10% to 30%, with an exemption for the five first years of activity. The rental value is exempted for the portion of the cost exceeding MAD 50 million.

A Payroll tax (called professional training tax) is imposed on the gross monthly remuneration of employees that are subject to social security contributions, at a rate of 1.6%. Morocco's mandatory social security regime is managed by the CNSS (Caisse Nationale de Sécurité Sociale). Employers' contributions are as follows: family allocation 6.40%; social allocation 8.60% (with a computation base capped at MAD 6,000); professional tax 1.60%; mandatory medical care 4.11%.

Other Domestic Resources

General Tax Administration

Tax Rate

Allowable Deductions and Tax Credits

The deductions from gross salary concern mainly social security contributions, retirement contributions, and a lump-sum deduction equal to 25% of the gross salary for incomes not exceeding MAD 78,000 (with a ceiling of MAD 35,000 per year).
The deduction applicable to pensions and life annuities is set at 70% of the gross taxable amount not exceeding MAD 168,000.

Charitable contributions are deductible if granted to organisms and societies expressly provided by the tax law. Loan interests relating to the acquisition of the main house are tax-deductible up to the limit of 10% of the taxable global revenue.

As per the provisions of the 2023 finance act, certain indemnities such as dismissal indemnity, compensation for voluntary departure, and compensation for damages awarded in the event of dismissal are exempt from taxation up to a maximum limit of MAD 1 million. However, if an individual receives multiple indemnities, the combined total amount of such indemnities exempted from income tax cannot surpass the aforementioned limit of 1 million.

Professional expenses incurred in the operation of the business are generally deductible unless specifically excluded.

Special Expatriate Tax Regime

Individuals with their main homes in Morocco are taxed on the totality of their incomes. Non-resident individuals are taxed only on Moroccan-sourced income.
There are no special regimes for expatriates (unless a double taxation treaty applies).