Tax Guide

Property Tax

In Morocco, property owners are required to pay an annual property tax. The first five years are exempt.  If it is a permanent residence or a holiday home, there may be discounts. After this, tax is due based on the annual rental value of the property.  The table below gives an approximate guide to the taxes due:

Tax on Rental Income

Buy to Let investors from the UK will be required to pay tax on the income from their Morocco-based property investment. 
The first three years can be exempt of tax, but afterwards investors must pay tax on 60% of their generated income at levels between 22% and 44%.

Property Rental Tax

If owners leave their properties empty, then a tax of 13.5% on the rental value is levied.

Garbage Collection Tax

The owner of a property is exempt from the garbage collection tax for the first five years.  After this period, tax is charged at 10% of the property's annual rental value.

Capital Gains Tax

If the property is sold within five years, capital gains tax is charged at 20% of the profit (with a minimum threshold of 3% of the sale price). A property sold between six and ten years of ownership will pay 10% capital gains tax and 0% thereafter. For capital gains tax purposes, the tax is based on: the sale price less the purchase price.

There is a double tax treaty in place between Morocco and the UK and this protects the investor from being liable for capital gains tax in both countries.

Inheritance Tax

There is 0% inheritance tax for family members, but it is essential to make a legal Moroccan Will and seek professional tax advice beforehand.

Corporate Tax

If you are considering investing in multiple property units in Morocco, it may be an idea to consider creating a Moroccan private limited company.

VAT

VAT is 20% as of January 2008