INDIVIDUAL TAXATION

Non-residents are taxed only on their Moroccan-sourced income. Married couples are taxed separately.

INCOME TAX

Income is taxed at progressive rates.

RENTAL INCOME
Net rental income is taxable under the general income tax (Impôt Général sur le Revenu or IGR) at progressive rates. A standard deduction of 40% of the gross rental income covers the income-generating expenses in lieu of itemized deductions.

CAPITAL GAINS TAX

Individuals earning capital gains from selling property are subject to tax on property profits (taxe sur les profits immobiliers or TPI). Profits on the sale of property are taxable at 20% of any profit, but with a minimum tax of 3% of the sale price. The taxable gain is computed by deducting the following from the selling price: acquisition price and incidental costs, transfer costs, investment expenses, and interest payments.

Capital gains from the sale of a property which has been the primary residence of the taxpayer are not subject to tax under some qualifications:

• The property has been the seller’s primary residence for at least eight years
• The property has been the seller’s primary residence for at least four years on the day of the sale, and the property area does not exceed 100 sq. m., and the profit does not exceed MAD200,000 (US$23,289)
• The profit made on one or more transfers by individuals within a calendar year whose total value does not exceed MAD60,000 (US$6,987)

PROPERTY TAX

Property Tax (Taxe d’habitation)

Property tax is assessed on the rental value of the property. The general property tax rate is 10% of the assessed rental value, as determined by the local tax authorities.

If the property is used as a primal residence, only 25% of the assessed rental property value is subject to tax. Properties occupied as a main or second residence are taxed at progressive rates.

New buildings are exempted from the tax for a 5-year period following completion.