If you own property in Morocco and live elsewhere, Morocco taxes your rent and the gain you make when you sell. If you let it, you have to file a return there every year, even if you do not live there. Two tax breaks exist, a 75% allowance on housing tax and a capital gains exemption on resale, and both depend on how the home is used, as a main residence or under a clause the law writes for MREs: a let property qualifies for neither.
Property tax in Morocco is not complicated, but every rule comes with a condition, and that condition decides whether it applies to you. This article follows the order of a real case: who taxes your rent, what you must declare and when, what the 20% option you may have heard about is really worth, what changes when you sell, and what your heirs will pay. It covers the Moroccan side: the tax on your rent and the annual return are the same for any owner who is not tax-resident in Morocco, whether you are a foreign national or an MRE (Marocains résidant à l’étranger, Moroccans living abroad, including dual nationals). Your country of residence may also tax this income, or your estate, under its own rules and any tax treaty it has with Morocco: check with a tax adviser in that country. Up to date: September 2026.
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- Morocco taxes the rent from your Moroccan property, even if you live abroad.
- You must file an annual return in Morocco before 1 March, even without living there, and even when the tax due is zero.
- The 20% flat-rate option created in 2025 applies only to rent subject to withholding tax, meaning rent paid by a company, a public body or a professional taxed under the actual or simplified net profit regime. With a private tenant, it does not apply to you.
- The two tax breaks, a 75% allowance on housing tax and a capital gains exemption after 5 years, depend on how the home is used: a main residence or, under a clause the law writes for MREs, a home kept in Morocco (resale exemption only) or lent free of charge to close family. Once the property is let, it qualifies for neither, whoever the owner is.
- The Moroccan General Tax Code provides for no tax on the value passed on at death. Your country of residence may have its own rules.
Rental income tax in Morocco: how your rent is taxed
In Morocco, an owner whose tax domicile is not in Morocco is taxed only on income from Moroccan sources, and rent is part of it. Gross rental income first receives a flat-rate allowance of 40%, which stands in for all costs, so nothing else can be deducted on top. The net income then goes through the progressive income tax scale. This scale, in force since 1 January 2025, charges 0% on the first 40,000 MAD of net taxable income and rises in brackets up to 37%.
Take a rent of 10,000 MAD a month, or 120,000 MAD a year. The allowance brings it down to 72,000 MAD of net taxable income. The first 40,000 MAD are taxed at 0%, the next 20,000 MAD at 10%, and the last 12,000 MAD at 20%. The Moroccan tax on this rent comes to 4,400 MAD, a little under 4% of the gross rent, assuming you have no other Moroccan income.
If your tenant is a company, a public body or a professional taxed under the actual or simplified net profit regime, it withholds 10% or 15% of the gross rent at source, depending on whether the annual rent is below 120,000 MAD or not. This withholding is not a separate tax: it is an advance, credited against the tax calculated on the scale and refunded if too much was taken. With a private tenant, there is no withholding, and the scale applies on its own.
That is not the only charge. The municipal services tax (taxe de services communaux) applies to a let property on the total rent, at 10.50% in urban areas. On most ordinary rents it weighs more than income tax, and it does not depend on your status. The rental yield calculator stops at gross yield: these two taxes are part of what separates gross from net.
Do you have to file in Morocco when you don’t live there?
Yes, and it is the point most owners who live abroad discover late. The obligation depends neither on where you live nor on the amount of rent. It follows from a chain of three articles of the Moroccan General Tax Code (Code général des impôts).
Article 82 requires an annual return of overall income (déclaration annuelle du revenu global), to be filed before 1 March by anyone whose income is not business income. Article 86 exempts some taxpayers from this return, but its cases are limited: salary income from a single employer, exempt retirement pensions, and income already subject to a final, discharging rate (taux libératoire). The 10% or 15% withholding described above does not appear in the list of final rates in article 73. An owner who lets to a private tenant therefore falls under none of the exemptions.
Since the 2023 income year, there is no longer a separate return for rent: it goes into the annual return of overall income, with, for each property, the tenant, the address, and the gross and net rent. The return is filed online. An annual rent that, once the 40% allowance is applied, stays below 40,000 MAD of net income, which means up to about 66,000 MAD of gross rent, produces zero tax, but it does not exempt you from filing.
There is one more deadline. A sale triggers a property gain return (déclaration de profit foncier) within 30 days of the sale, together with payment of the tax.
So the Moroccan calendar of an owner living abroad comes down to two dates:
- Before 1 March, every year: the annual return of overall income, including the previous year’s rent.
- Within 30 days of a sale: the property gain return and payment of the tax.
To these, add whatever your country of residence requires for income from abroad: that depends on its own rules, not on Moroccan law.
The 20% option: only when your tenant withholds tax
The 2025 Finance Act (loi de finances 2025) created a new option for rental income: taxation at a final rate of 20%, calculated on the gross rent with no allowance, in exchange for an exemption from the annual return for that income. It applies to rent received since 1 January 2025 and rests on articles 64-IV and 73-II-F-12° of the General Tax Code.
It is not open to every case. The text reserves it for rental income subject to withholding tax, meaning rent paid by a legal entity (personne morale), such as a company or a public body, or by a professional taxed under the actual or simplified net profit regime (régime du résultat net réel or simplifié). A private tenant renting your flat to live in withholds nothing. If that is your situation, and it is the situation of most MRE owners, the option is not available to you.
If you let to a company, the option is requested online from the tax administration, against a receipt, a copy of which you give your tenant, who then withholds 20% at source. Do the sums first: 20% of the gross rent, against the scale applied to 60% of the gross rent. Unless the rent is very high, or other Moroccan income already places you in the top brackets, the scale remains more favourable. The option buys simplicity, rarely a saving.
A threshold of 40,000 MAD goes with this mechanism, and it does not mean what it seems to mean. Below this amount of annual rent paid to the same owner, a professional tenant does not have to withhold tax at source. It is a collection rule, not an exemption: the owner still owes the tax and must still file. It also only applies to the 10% or 15% withholding: it does not apply to rent under the 20% option. The first bracket of the scale also stops at 40,000 MAD, an alignment the administration presents as a harmonisation, but the two thresholds do not apply to the same base: one to the gross rent paid, the other to the net income after the allowance.
Two tax breaks that depend on how the home is used
Two provisions of Moroccan law expressly name Moroccans living abroad. They sit in two different texts, concern two different taxes, and are written for the same use of the property.
The first is in the law on local taxation. Article 24 of Law 47-06 applies a 75% allowance to the rental value (valeur locative) of each taxpayer’s main residence, for the housing tax (taxe d’habitation). It extends this allowance to the home that Moroccans living abroad keep as their main residence in Morocco, occupied free of charge by their spouse, their ascendants or their first-degree descendants in the direct line. The allowance cannot be combined with any other reduction of this tax.
The second is in the General Tax Code. Article 63-II-B exempts from tax the gain made on the sale of a home used as a main residence for at least 5 years on the day of the sale. It specifies that the home Moroccans living abroad keep as their home in Morocco, or the one occupied free of charge by their spouse, ascendants or first-degree descendants, is treated as a main residence. The text in force says 5 years. Three further details in the same article are worth knowing: the exemption applies only once per 5-year period, a vacancy of up to one year is tolerated between moving out and the sale, and the land on which the home stands is covered up to 5 times the built area.
| Housing tax allowance | Capital gains exemption on resale | |
|---|---|---|
| Text | Law 47-06, art. 24 | General Tax Code, art. 63-II-B |
| What it gives | 75% allowance on the rental value | Exemption after 5 years as a main residence |
| Base rule | The taxpayer’s main residence | A home used as a main residence |
| Clause written for MREs | Home kept in Morocco, occupied free of charge by spouse, parents or children | Home kept in Morocco, or occupied free of charge by spouse, parents or children |
| If the property is let | Not covered | Not covered |
Read the two clauses side by side. They are not word for word identical: for housing tax, the home kept in Morocco must be occupied free of charge by close family; for the resale exemption, a home kept in Morocco counts even with no one living in it, or when occupied by the family. But they describe the same use: a home, kept for yourself or, under the MRE clause, lent to your family. Being an MRE does not in itself give either advantage. Both are attached to this use.
The day you let the property, you fall outside both, whoever the owner is. Housing tax does not apply to let property, which comes under the municipal services tax with no allowance at all, and a let home is no longer a main residence within the meaning of article 63. If you are buying to let, do your sums without either advantage, and count on them only if you plan to make the property your home or, under the clause the law writes for MREs, to lend it free of charge to your close family.
One last figure is sometimes read as a condition when it is not one. The amount of 4,000,000 MAD appears nowhere in article 63-II-B. It comes from article 144-II-2°, which imposes a minimum of 3% on the portion of the sale price above this threshold, even when the gain is exempt. A property sold for more than 4 million MAD therefore keeps its exemption on most of the price and bears 3% on the excess, nothing more.
The price you declare in the deed sets this base, just as it sets the base for the buyer’s registration duties, and the tax administration checks that price.
Inheritance, in two sentences
The Moroccan General Tax Code provides for no tax based on the value passed on at death: what remains are deed duties, including 1% on the inventory drawn up after death, and the fees for registering the heirs on the title. Your heirs’ country of residence, or yours, may tax the inheritance under its own rules and any tax treaty it has with Morocco: check with a tax adviser in that country.
If your heirs later sell the property, whether they can transfer the proceeds out of Morocco depends on what was declared when the money came in: I explain the foreign-currency rule in can foreigners buy property in Morocco.
What to remember before you buy
Property tax in Morocco for non-residents is not complicated; it is conditional. Every rule carries its condition, and that is what you need to read before counting on an advantage: is the property let or occupied by the family, is the tenant a private individual or a company, and what does your own country of residence do with this income. A rental project is calculated without the 75% allowance and without the capital gains exemption, with the municipal services tax and the tax on the scale, and with an annual return in Morocco. A family project gets them back, and loses the rent.
What your country of residence changes. This article covers Moroccan law only. How the tax is shared between Morocco and the country where you live is set by the tax treaty between the two, or by that country’s own law if there is no treaty, and the methods for avoiding double taxation differ from one treaty to another. Check your own country’s treaty with a tax adviser there before drawing any conclusion. Moroccan law, for its part, does not change with where you live: the return before 1 March, the 20% option and its limits, the two tax breaks and their condition apply whatever your country.
If you want to place your own case within these rules (rent, intended use, country of residence, resale horizon), book a free 20-minute call on Calendly, or message me on WhatsApp. I run your project’s figures through the full model, Moroccan taxes included.
Sources: Moroccan General Tax Code (Code général des impôts), art. 23, 63, 64, 65, 73, 82, 83, 86, 127, 133, 144 and 160 bis; summary note and circular note no. 736 of the Directorate General of Taxes (Direction générale des impôts) on the 2025 Finance Act; Law no. 47-06 on local authority taxation, art. 19, 22, 23 and 24. This article is for information only and does not constitute tax or legal advice; have your situation confirmed by a qualified professional in Morocco and in your country of residence.
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Frequently asked questions
Do I have to file a tax return in Morocco if I don't live there?
Yes, if the property is let: before 1 March each year, for the previous year's rent. None of the exemptions in article 86 of the General Tax Code covers an owner who lets to a private tenant. Only the 20% option, which applies to rent subject to withholding tax, removes the obligation to declare that particular income. Since 2023, rent is declared in the annual return of overall income.
Does the 75% housing tax allowance apply to a property that is let?
No. Housing tax does not apply to let property. The allowance concerns a main residence and, under the clause the law writes for Moroccans living abroad, a home kept in Morocco and occupied free of charge by the spouse, ascendants or first-degree descendants. A let property comes under the municipal services tax, calculated on the rent.
Can a non-resident landlord choose the 20% flat rate on rent?
Only if the rent is paid by a legal entity or by a professional taxed under the actual or simplified net profit regime, in other words rent subject to withholding tax. With a private tenant, the option created by the 2025 Finance Act is not available: there is no withholding, and the progressive scale applies after a 40% allowance.
Does Morocco charge inheritance tax on a flat?
The Moroccan General Tax Code provides for no tax on the value passed on at death. What remains are deed duties, including 1% on the inventory drawn up after death, and the fees for registering the heirs on the title. Your heirs' country of residence, or yours, may tax the inheritance under its own rules: check with a tax adviser there.
Does the capital gains exemption after 5 years apply to an MRE who lives abroad?
Yes, under a specific clause. The text treats as a main residence the home that a Moroccan living abroad keeps in Morocco as their home, or the one occupied free of charge by their spouse, ascendants or first-degree descendants. A property that is let does not qualify, and a sale price above 4,000,000 MAD bears a minimum of 3% on the portion above that amount.
Property investment advisor in Morocco. I help international buyers and the Moroccan diaspora buy in Casablanca, Rabat and Marrakech, on the buyer's side only.