Rental Income Tax in Morocco for Owners Abroad

Morocco's income tax, the impôt sur le revenu (IR), treats rental income as one of six taxable categories of revenue under Article 22, and nothing in that article or the ones that follow it sets a different rate for a foreign or non-resident owner. What residence decides is scope, not rate. Under Article 23, someone with a Moroccan fiscal domicile, meaning a permanent home in Morocco, the centre of their economic interests there, or more than 183 days of presence in any 365-day period, is taxed on worldwide income. Anyone else is taxed in Morocco only on Moroccan-source income. Rent from a flat in Tangier or a villa in Marrakech is Moroccan-source by definition, so it is taxable here regardless of where you keep the rest of your life.

Rental income (revenus fonciers) covers rent from letting built or unbuilt property and agricultural land, the notional value of a property you let a third party use free of charge, eviction compensation paid to a tenant, and certain property-fund distributions, under Article 61. That same article only applies when the letting has not tipped over into a professional activity, a distinction that matters for furnished short lets, covered below.

The gross figure is the total rent received, adjusted for any repair costs the tenant covers on the owner's behalf and any costs the owner covers on the tenant's behalf, under Article 64-I. From that gross figure, Article 64-II takes a flat 40% allowance, deemed to cover the owner's running costs, with no need to produce receipts for actual maintenance spend. The remaining 60% is what gets taxed.

If your tenant is an ordinary individual, none of the withholding rules below apply. The net rental figure, after the 40% allowance, is added to any other Moroccan income you declare and taxed under the general scale at Article 73-I: nothing on the first 40,000 dirhams, then 10% up to 60,000, 20% up to 80,000, 30% up to 100,000, 34% up to 180,000 and 37% above that.

If your tenant is a company, a public body, or an individual taxed as a business under the net real or simplified professional regime, Article 160 bis requires them to withhold the tax themselves before the rent reaches you, at the rates set in Article 73-II (B-5° and C-4°): 10% of the gross taxable rent if the annual amount they pay you is under 120,000 dirhams, or 15% if it is 120,000 dirhams or more. That tenant must also file an annual declaration naming each owner, the property, and the gross rent, net rent and withholding involved, before 1 March of the following year, under Article 154 bis.

A company or professional tenant is excused from withholding anything at all if the gross annual rent it pays to one owner does not exceed 40,000 dirhams, under Article 160 bis. Below that, the arrangement works the same as an individual tenant: you declare the net figure yourself.

Where withholding does apply, you are not stuck with the 10% or 15% rate. Under Article 64-IV, an owner can opt instead for a single flat rate of 20% on the gross rent, under Article 73-II-F-12°. The request is submitted electronically to the tax authority, and a copy of the receipt must reach the tenant at least 30 days before the next rent payment is due. Once you are on this option, that rental income is excluded from your overall annual declaration entirely, under Article 25, since it is taxed at what the code calls a taux libératoire, a rate that settles the matter on its own. For an owner who does not want to file a Moroccan tax return every year over one rented flat, that trade, a flat 20% instead of a progressive scale that could run lower, is often worth the simplicity.

All of the above assumes a standard letting, the kind that stays inside Article 61's definition of rental income. A letting that becomes a business, rather than simply putting a property to income, falls out of this regime and into revenus professionnels instead, with its own rules. Furnished or professionally equipped premises are also one of the operations Article 89 of the same code lists as subject to VAT, a separate tax again. Where the line sits between an ordinary furnished rental and a VAT-registered, professionally run letting business is a judgement on the facts, not a fixed figure, so if you are weighing up a long lease against a short let or already letting through a booking platform, read what the short-term rental rules actually require and have a Moroccan accountant confirm which regime your listing sits under before you file anything.

There is also a narrower rule that only reaches a small group of owners: from 2026, Article 15 ter and Article 73-II-A add a 5% withholding on rent paid to a landlord who is themselves taxed as a business under the net real or simplified regime. That is a professional landlord being paid by certain large payers, not an individual letting an investment flat, and will not touch most owners reading this.

This is an income tax, charged only in a year you actually receive rent. It has nothing to do with the taxe d'habitation and taxe de services communaux, which are charged every year on an assessed rental value whether or not the property is let at all. Owners abroad sometimes assume settling one covers the other. It does not.

Whichever route applies to you, keep the paperwork: the tenant's withholding receipt if a company pays you, or your own filing record if you declare it yourself. It is exactly this kind of evidence a Moroccan bank will ask for before letting rental proceeds move freely, so get the non-resident account that will receive the rent set up with this in mind from the start, rather than after the first dispute over a transfer.