Key takeaways: Moroccans Residing Abroad (MRE) are subject to Moroccan tax only on their Moroccan-source income (rental income, dividends, real estate capital gains). Tax residence is determined by Art. 23 of the CGI: 183 days of stay, permanent home, or center of economic interests. Tax treaties (Morocco-France, Morocco-Belgium, Morocco-Canada, etc.) eliminate double taxation through tax credits or exemption with progression. A return is due in Morocco for income not subject to a final levy (property income under the progressive scale, real estate gains, gains on securities not registered with an intermediary); it can be filed online via SIMPL.
MRE Tax Residence: The Criteria of Art. 23 CGI
Definition of Tax Residence in Morocco
Tax residence determines the scope of a taxpayer’s fiscal obligations. In Morocco, Article 23 of the General Tax Code (CGI) defines three alternative criteria for establishing tax residence:
- Permanent home: The taxpayer has a dwelling in Morocco as owner, usufructuary, or tenant, on a permanent basis, and has their family (spouse, children) there
- Center of economic interests: The taxpayer carries out a principal professional activity in Morocco or holds significant investments there generating the majority of their income
- Duration of stay: The taxpayer stays in Morocco for a continuous or discontinuous period exceeding 183 days in any 365-day period
Implications for MREs
An MRE who meets none of these three criteria is considered a non-resident for tax purposes in Morocco. They are then taxable in Morocco only on their Moroccan-source income:
- Rental income from property located in Morocco
- Dividends distributed by Moroccan companies
- Real estate capital gains on property located in Morocco
- Capital gains from the disposal of Moroccan securities
- Compensation for services rendered in Morocco
Tie-Breaker Rules in Case of Dual Residence
In case of a residence conflict (the MRE is considered resident in both countries), the applicable tax treaty provides tie-breaker rules, generally in the following order:
- Permanent home
- Center of vital interests
- Habitual place of residence
- Nationality
- Mutual agreement between competent authorities
Income Subject to Double Taxation
Salaries and Wages
Salaries earned by an MRE in their host country are generally taxable exclusively in that country, unless the work is performed in Morocco. Tax treaties attribute the right to tax salaries to the state where the activity is carried out.
Exception: The 183-day rule allows an employee temporarily assigned to Morocco to remain taxable only in their state of residence, if the stay does not exceed 183 days over a 12-month period and the employer is not a Moroccan resident.
Retirement Pensions
The tax treatment of retirement pensions for MREs varies by treaty:
- Morocco-France Treaty (Art. 17): Private pensions are taxable in the beneficiary’s state of residence. A French retiree of Moroccan origin living in France pays taxes in France
- Public pensions: Generally taxable in the paying state (the country paying the pension)
- Moroccan tax advantage: Since 1 January 2026, pensions paid by basic retirement schemes are exempt from IR. For taxable foreign pensions, the net income benefits from a flat-rate allowance (Art. 60 of the CGI: 70% on the annual gross portion not exceeding 168,000 DH, 40% above); to this is added an 80% reduction of the IR due corresponding to amounts transferred on a permanent basis in non-convertible dirhams (Art. 76 of the CGI)
Strategy: Some retired MREs choose to return to Morocco to benefit from this advantageous taxation on their foreign pensions.
Rental Income in Morocco
Rental income from real estate located in Morocco is always taxable in Morocco, regardless of the owner’s tax residence. This is the source taxation principle for real estate income, confirmed by all Moroccan tax treaties.
IR regime applicable to non-residents:
| Net Taxable Income Bracket | IR Rate |
|---|---|
| 0 to 40,000 DH | 0% |
| 40,001 to 60,000 DH | 10% |
| 60,001 to 80,000 DH | 20% |
| 80,001 to 100,000 DH | 30% |
| 100,001 to 180,000 DH | 34% |
| Above 180,000 DH | 37% |
Rental income of individuals is subject to IR at the progressive scale, after a 40% flat-rate allowance on the gross amount of rents (Art. 64-II of the CGI). Where the rent is paid by a legal entity or by a professional taxed under the actual or simplified net income regime, the payer applies a withholding tax on the gross amount of 10% (annual gross rental income below 120,000 DH) or 15% (120,000 DH and above), creditable against the IR due, with no withholding required where annual gross rents do not exceed 40,000 DH (Art. 73-II-B-5°, C-4° and 160 bis of the CGI). The landlord may opt for a 20% final levy on the gross amount (Art. 64-IV and 73-II-F-12°).
Moroccan-Source Dividends
Dividends distributed by Moroccan companies to non-resident MREs are subject to a 11.25% withholding tax in 2026 (progressively decreasing to 10% from 2027, Art. 247-XXXVII-C of the CGI). Tax treaties cap this rate: the domestic rate of 11.25% applies where it is lower than the treaty cap.
See our guide on withholding tax on dividends for country-specific details.
Real Estate Capital Gains
Capital gains on the disposal of real estate located in Morocco are taxable in Morocco at a rate of 20% of net profit (with a minimum of 3% of the sale price). Exemptions exist for:
- Primary residence occupied for at least 5 years on the date of sale (if the price exceeds 4 M DH, a minimum tax of 3% is due on the portion of the price above 4 M DH — Art. 63-II-B and 144-II-2° of the CGI)
- Gratuitous transfers (donations) between ascendants and descendants, between spouses, and between siblings (Art. 63-III of the CGI); an onerous sale to a child, by contrast, remains taxable
For MREs: The CGI treats as a primary residence the home that the MRE keeps as their residence in Morocco, or the one occupied free of charge by their spouse, ascendants or descendants in the direct line of the first degree, as long as it has not been rented out or used for business purposes (Art. 63-II-B). An MRE can therefore benefit from the exemption if this home meets the 5-year condition.
Mechanisms for Eliminating Double Taxation
Tax Credit Method
The most common method in Moroccan treaties is the tax credit:
- The income is taxed in the source state (e.g., Moroccan-source dividends)
- The residence state (e.g., France) includes this income in the taxable base
- The residence state grants a tax credit equal to the tax paid in Morocco, up to the corresponding tax in the residence state
Example: An MRE in France receives 200,000 DH in dividends from a Moroccan company. The Moroccan WHT is 22,500 DH (11.25%). In France, these dividends are reported at their gross amount; the corresponding French IR is the equivalent of 30,000 DH. The Morocco-France convention grants a flat-rate tax credit equal to 25% of the gross dividend, i.e. 50,000 DH, capped at the corresponding French IR: the net French IR on these dividends is nil. Total tax burden: 22,500 DH (not 52,500 DH without treaty).
Specific feature of the Morocco-France convention: the treaty cap on dividend withholding is 15% (amendment of 18 August 1989); since the Moroccan domestic rate of 11.25% in 2026 is lower, it is the one that applies. In France, the resident beneficiary reports the gross dividend and offsets a flat-rate tax credit equal to 25% of that gross amount (Art. 25-3-a of the convention), capped at the corresponding French tax.
Note: Real estate income (rents, capital gains) is exclusively taxable in the state where the property is located. An MRE receiving rental income from property in Morocco is taxable only in Morocco on that income — no double taxation and no tax credit to claim in the country of residence.
Exemption with Progression Method
Certain treaties provide for exemption of the income in the residence state, while taking it into account to determine the tax rate applicable to other income (progression).
Example: The Moroccan income is exempt in France but increases the marginal rate applicable to the taxpayer’s French income.
Tax Treaties: Comparison by Host Country
Morocco-France Treaty
The Morocco-France tax treaty is the most used by MREs. Signed in 1970 and amended, it provides:
| Income Type | Right to Tax | Mechanism |
|---|---|---|
| Real estate income (Art. 9) | State where property is located (Morocco) | Exclusive taxation — State of property location |
| Dividends (Art. 13) | Max WHT 15% source state (amendment of 18 August 1989); in 2026, the lower Moroccan domestic rate of 11.25% applies | Flat-rate tax credit of 25% of the gross dividend in France (Art. 25-3-a) |
| Interest (Art. 14) | Max WHT 10% source state (15% for term deposits and savings bonds, amendment of 18 August 1989) | Tax credit |
| Private pensions (Art. 17) | State of residence | Exemption in Morocco |
| Public pensions | Paying state | Tax credit |
| Real estate capital gains (Art. 24) | State where property is located (Morocco) | Exclusive taxation — state where property is located |
Morocco-Belgium Treaty
| Income Type | Morocco WHT Rate | Mechanism in Belgium |
|---|---|---|
| Dividends | 10% | Tax credit |
| Interest | 10% | Tax credit |
| Royalties | 10% | Tax credit |
| Real estate income | Domestic law | Exemption with progression |
| Private pensions | State of residence | — |
Morocco-Canada Treaty
| Income Type | Morocco WHT Rate | Mechanism in Canada |
|---|---|---|
| Dividends | 15% | Tax credit |
| Interest | 15% | Tax credit |
| Royalties | 10% | Tax credit |
| Real estate income | Domestic law | Exclusive taxation — State of property location |
| Pensions | State of residence | — |
Other Key Treaties for MREs
| Country | Dividends | Interest | Royalties |
|---|---|---|---|
| Germany | 5/15% | 10% | 10% |
| Italy | 10% | 10% | 5/10% |
| Spain | 10/15% | 10% | 5/10% |
| Netherlands | 10/25% | 10% | 10% |
| United Arab Emirates | 5/10% | 10% | 10% |
Note: Reduced rates (5%, 10%) generally apply when the beneficiary holds a significant participation (often 25% or more).
Morocco has also built a network of treaties signed with African countries, which is relevant for MREs based on the continent.
MRE Tax Filing in Morocco
When Is Filing Mandatory?
A non-resident MRE must file a tax return in Morocco in the following cases:
- Rental income: Annual IR/rental income return
- Real estate capital gains: Filing within 30 days of the sale
- Moroccan-source professional income
- Securities capital gains (disposal of securities)
For dividends, the 11.25% WHT (2026) is final: no additional filing is required.
Filing via SIMPL
Electronic filing via the DGI’s SIMPL portal is mandatory for businesses and the liberal professions; for a non-professional MRE landlord it remains optional, and filing a paper return with the tax inspector is still possible (Art. 82-I and 155-I). To file online, MREs must:
- Create an account on simpl.tax.gov.ma with their tax identification number (IF) or CIN/passport
- File the annual global income return by March 1 of the following year
- Attach supporting documents (lease agreements, foreign tax assessments, etc.)
MRE Foreign Exchange Regime
Foreign Currency Accounts
MREs benefit from a preferential foreign exchange regime governed by the Exchange Office circular:
- Foreign currency account (or convertible dirham account): Allows depositing foreign currency without amount limitation
- Free repatriation: Investment income in Morocco (rent, dividends, capital gains) is freely transferable abroad, upon proof of Moroccan tax payment
- Investments in Morocco: MREs may freely invest in real estate, listed shares, and company equity
Convertible Term Deposit Account
The convertible term deposit account allows MREs to place their convertible dirhams in term deposits with Moroccan banks, with the option of reconversion to foreign currency at any time.
Transfers and Documentation
To transfer rental income or capital gains abroad, the MRE must present to their bank:
- The tax payment certificate (DGI receipt)
- The sale or lease agreement
- Proof of the origin of funds (title deed, investment certificate)
MRE Real Estate Investment
IR on Rental Income
An MRE landlord in Morocco is taxed at the progressive IR scale on their net rental income, after a 40% flat-rate allowance (Art. 64-II of the CGI). Where the rent is paid by a legal entity or a professional under the actual or simplified net income regime, a withholding tax of 10% (annual gross rents below 120,000 DH) or 15% (above) is applied to the gross amount and is creditable against the IR due; the tenant is released from withholding where annual gross rents do not exceed 40,000 DH (Art. 160 bis).
Possible optimizations:
- Option for the 20% final levy (Art. 64-IV and 73-II-F-12°): available where rents are subject to withholding tax; calculated on the gross amount, final, with no return required for this income (Art. 86-6°). Worthwhile only if the rents would otherwise be taxed at the progressive scale in the 34% or 37% brackets
- Moroccan SCI (civil real estate company): Structuring ownership through a real estate company can offer benefits in terms of succession and management
MRE Real Estate Capital Gains
The net disposal profit is subject to IR at a rate of 20% (minimum 3% of sale price). The net profit is calculated as follows:
Net profit = Sale price - (Revalued acquisition price + Flat-rate acquisition costs 15% + Justified investment expenses)
The revaluation coefficient is published annually by the tax administration to account for inflation.
For disposals of securities or assets held across several jurisdictions, the treatment of international capital gains follows specific allocation rules laid down by the treaties.
Registration Fees
Real estate acquisition is subject to the following registration fees (2026):
| Property Type | Rate |
|---|---|
| Bare land | 5% |
| Social housing (up to 300,000 DH) | 3% |
| Other properties | 4% |
| Land conservation fee | 1.5% |
MRE and Tax FAQ
Must an MRE declare their foreign income in Morocco?
No, unless they are considered a tax resident of Morocco (Art. 23 CGI). A non-resident MRE only declares their Moroccan-source income.
How to obtain a tax clearance for an MRE selling property in Morocco?
The tax clearance is issued by the tax collection office after payment of IR on the capital gain. It is essential for transferring the sale proceeds abroad.
Can an MRE benefit from a reduced WHT rate on dividends?
Only if the cap set by the applicable tax treaty is lower than the domestic rate of 11.25% (2026); otherwise, the domestic rate applies. To benefit from the treaty cap, they must provide a tax residence certificate from the host country.
Are French retirement pensions taxable in Morocco?
Under the Morocco-France treaty, private pensions are taxable in the state of residence. If the retired MRE lives in France, their pensions are taxable in France only. If they return to Morocco, the pensions become taxable in Morocco — bearing in mind that since 2026 pensions from basic schemes are exempt from IR, and that taxable foreign pensions benefit from the Art. 60 allowance (70% up to 168,000 DH, 40% above) and the 80% IR reduction for amounts transferred on a permanent basis in non-convertible dirhams (Art. 76).
Is Moroccan rental income taxable in the host country?
No. Real estate income is exclusively taxable in the state where the property is located (Morocco). The MRE files and pays IR in Morocco on their rental income. They do not need to include it in their host country tax return, and there is no tax credit to claim since the host country has no right to tax this income.
Can an MRE invest in an SARL in Morocco?
Yes, without restriction. Investment in SARL equity is free for MREs, in accordance with Exchange Office provisions. Dividends received will be subject to the 11.25% WHT in 2026 (or the treaty cap if lower). For more information on investment in Morocco, see our dedicated guide.
What is the tax statute of limitations for MREs?
The administration may correct understatements until December 31 of the fourth year following the year in which the income was earned (Art. 232-I). For taxpayers who have not filed their return, the tax is due for all undeclared years, within a limit of 10 years (Art. 232-VIII-15°). Where declared income is inconsistent with the taxpayer’s lifestyle, the administration may also initiate an overall examination of the taxpayer’s tax situation.
MRE taxation combines Moroccan tax law and international treaties: the characterisation of each item of income (source, residence, applicable treaty) determines which state taxes it and the mechanism for eliminating double taxation.
