Urban rent tax
Rental income subject to IR progressive scale after 40% flat abatement. Alternative: option for 10% discharge withholding if gross annual rents < 120,000 MAD (simplified regime).
Who is concerned
Any owner renting real estate in Morocco (individual or professional). Rents taxed at IR under property income.
Deadlines
Annual declaration joined to IR declaration (before March 1). For SCI: IS declaration within 3 months after closing.
How it works
Net property income = Gross annual rents × 60% (40% abatement for fictitious expenses). Added to global IR income. Tenant (company) can withhold 10% of excl.-tax rent at source and remit to DGI (discharge of declarative obligation for owner).
2026 rates and scales
Normal regime: after 40% abatement, taxation per IR scale (0 to 37%). Simplified regime: 10% discharge withholding if rents < 120,000 MAD/year, without additional IR declaration.
Concrete example
Monthly rent 5,000 MAD × 12 = 60,000 MAD/year. Simplified regime option: Tax = 60,000 × 10% = 6,000 MAD. Normal regime option (high global income): 60,000 × 60% = 36,000 MAD taxable in 30% bracket → 10,800 MAD. Simplified regime more advantageous here.
Exemptions
Rents < 30,000 MAD/year: total IR exemption. Social housing (monthly rent < 2,000 MAD for 20+ years): 10-year exemption for lessor.
Declarative obligations
Declaration of rents received at IR (property income). Registered lease contract mandatory for enforceability. Source withholding certificate if professional tenant.
Penalties for non-compliance
Non-declaration of rents: 4-year adjustment with 100% penalty. Undeclared rents can be detected via registered contracts or tenant complaints.
Legal optimization tips
- If rents < 120,000 MAD: opt for 10% simplified regime (often more advantageous)
- If rents > 120,000 MAD: evaluate creating SCI to optimize via IS (22.5%)
- Justify improvement works to reduce taxable base (normal regime)
- Systematically register lease contract for legal enforceability (in case of dispute)
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