In brief: Salary income tax (IR) in Morocco is calculated using a progressive scale ranging from 0% to 37% (Art. 73 of the General Tax Code). For a gross monthly salary of MAD 12,000, the monthly IR amounts to approximately MAD 921 after deducting CNSS/AMO contributions, professional expenses and family dependant allowances. The employer is required to make the withholding at source each month and remit it to the DGI.
2026 Salary Income Tax Scale (Art. 73 CGI)
The income tax scale applicable to salary income is set by Article 73 of the General Tax Code (CGI). It applies to the employee’s annual net taxable income.
| Annual Income Bracket (MAD) | Rate | Amount to Deduct |
|---|---|---|
| 0 – 40,000 | 0% | — |
| 40,001 – 60,000 | 10% | 4,000 |
| 60,001 – 80,000 | 20% | 10,000 |
| 80,001 – 100,000 | 30% | 18,000 |
| 100,001 – 180,000 | 34% | 22,000 |
| Over 180,000 | 37% | 27,400 |
The amount to deduct is a quick calculation mechanism: IR = (Net taxable income x Rate) - Amount to deduct. This system produces the same result as a bracket-by-bracket calculation.
Step-by-Step Salary IR Calculation
The calculation of IR on salaries follows a multi-step process, starting from gross salary to arrive at the net tax payable.
Step 1: Determine the Gross Taxable Salary (SBI)
The gross taxable salary includes all remuneration paid to the employee:
- Base salary
- Overtime
- Bonuses and gratuities (seniority, performance, 13th month)
- Benefits in kind (housing, vehicle, valued at actual cost)
- Various allowances (except those that are exempt)
Step 2: Deductions from Gross Salary
The following are deducted from the gross taxable salary to obtain the net taxable salary:
- CNSS contributions (employee share): 4.48% capped at MAD 6,000/month, declared monthly by the employer on Damancom
- AMO contributions (employee share): 2.26% without ceiling
- CIMR contributions (if applicable): employee share is deductible
- Professional expenses: flat-rate deduction of 35% of the gross taxable salary (annual gross taxable income ≤ MAD 78,000) or 25% above that threshold, calculated on the gross taxable salary excluding cash benefits and benefits in kind, capped at MAD 35,000 per year
Step 3: Calculate the Net Taxable Income
Net taxable income = SBI - CNSS contributions - AMO contributions - Professional expenses
Step 4: Apply the Scale
The progressive scale is applied to the annual net taxable income (or monthly by dividing the brackets by 12) to obtain the gross IR.
Step 5: Family Dependant Deductions
The gross IR is reduced by family dependant deductions:
- MAD 600 per dependant per year (i.e., MAD 50/month)
- Maximum 6 dependants (spouse and dependent children, all persons combined)
- Maximum annual deduction: MAD 3,600 (i.e., MAD 300/month)
Net IR = Gross IR - Family dependant deductions
Complete Worked Example: Gross Monthly Salary of MAD 12,000
Consider an employee who is married with 2 children, earning a gross monthly salary of MAD 12,000.
Monthly Calculation
| Item | Amount (MAD) |
|---|---|
| Gross monthly salary | 12,000.00 |
| (-) Employee CNSS (4.48% x 6,000) | 268.80 |
| (-) Employee AMO (2.26% x 12,000) | 271.20 |
| (-) Professional expenses (25% x 12,000 = 3,000, reduced to the MAD 35,000/year cap) | 2,916.67 |
| = Monthly net taxable salary | 8,543.33 |
Applying the Scale (monthly amounts)
Annual net taxable income = 8,543.33 x 12 = MAD 102,520
Annual gross IR = (102,520 x 34%) - 22,000 = MAD 12,856.80
Family dependant deductions (spouse + 2 children = 3 persons): 3 x 600 = MAD 1,800/year
Annual net IR = 12,856.80 - 1,800 = MAD 11,056.80
Monthly IR = 11,056.80 / 12 = MAD 921.40
Summary
| Item | Monthly (MAD) |
|---|---|
| Gross salary | 12,000.00 |
| CNSS contributions | -268.80 |
| AMO contributions | -271.20 |
| IR withheld at source | -921.40 |
| Net salary payable | 10,538.60 |
Items Exempt from IR (Art. 57 CGI)
Certain remuneration elements are exempt from income tax:
Full Exemptions
- Family allowances paid by the CNSS
- Disability pensions provided by the CNSS
- Daily allowances for illness, occupational accident and maternity (CNSS)
- Severance pay, voluntary departure compensation and damages awarded in the event of dismissal: exempt within an overall limit of MAD 1,000,000 for the total amount of these indemnities (Art. 57-7°, Finance Act 2023), regardless of their amount under the Labour Code
- Study grants
Partial Exemptions
- Expense allowances (representation, travel, transport, assignment): exempt insofar as they cover expenses actually incurred in the performance of the duties and are justified, whether reimbursed on statements or granted as a flat amount (Art. 57-1°). The exemption does not apply to employees benefiting from the special professional expense rates (Art. 59-I-B and C)
- Meal vouchers (including in electronic form): exempt up to MAD 40 per employee per working day, without exceeding 20% of the gross taxable salary, and not cumulable with food allowances for remote worksites (Art. 57-13°)
Employer Withholding at Source (Art. 156 and 174 CGI)
Article 156 of the CGI requires every employer domiciled or established in Morocco to make the withholding at source of IR on each salary payment, and Article 174 sets the deadline for remitting these withholdings to the Treasury. This withholding constitutes an advance payment of tax on behalf of the employee.
Employer Obligations
- Monthly calculation of IR for each employee
- Withholding of the IR amount from the net salary
- Payment to the General Tax Directorate (DGI) before the end of the month following salary payment
- Annual declaration of salaries and wages (form 9421) before 1 March of the following year
Employer Liability
The employer is liable for remitting the IR withheld at source. In the event of late payment or non-payment, the amounts due bear the 20% penalty and the 5% surcharge for the first month of delay, then 0.50% per additional month or fraction of a month (Art. 200-I and 208 CGI).
Frequently Asked Questions (FAQ)
How do I quickly calculate IR on a monthly salary?
For a quick calculation, divide the annual scale brackets by 12 to obtain the monthly brackets. Then apply the formula: IR = (Monthly net taxable income x 12 x Rate) - Amount to deduct, then divide by 12. You can also use our net/gross salary simulator.
Are exceptional bonuses subject to IR?
Yes, all bonuses and gratuities paid to the employee are subject to IR, whether regular or exceptional. The employer must apply withholding at source on these amounts by adding them to the gross salary for the month of payment.
Is severance pay taxable?
Severance pay is exempt from IR up to MAD 1,000,000 (Art. 57-7°, Finance Act 2023). This cap applies to the total amount of severance pay, voluntary departure compensation and damages awarded in the event of dismissal. Above this amount, the excess is subject to IR under the progressive scale, in the year of payment.
Does the professional expenses deduction apply to all employees?
Yes, the flat-rate professional expenses deduction applies to all private and public sector employees: 35% of the gross taxable income where it is less than or equal to MAD 78,000 per year, and 25% above that, all capped at MAD 35,000 per year. Certain professions benefit from enhanced rates (journalists, miners, etc.) as provided by the CGI.
How do I declare family dependants to benefit from deductions?
The employee must provide their employer with a family dependant declaration form listing the spouse and dependent children. The employer then applies the deduction of MAD 600/year per dependant (maximum 6 persons, i.e. MAD 3,600).
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This article is written by the team of chartered accountants at Upsilon Consulting, a firm registered with the Order of Chartered Accountants (OEC) of Morocco.
