Shareholder Current Account Interest Morocco 2026: 2.15%

In brief: In 2026, interest on shareholder current accounts is deductible from corporate tax (IS) only at a maximum rate of 2.15%, on sums no greater than the share capital, and only if that capital is fully paid up (Art. 10-II-A-2° of the CGI; order no. 231-26 of 6 February 2026).

A shareholder current account is a cash advance made by a shareholder to their company. Paying interest on it raises two questions: how much of the interest can the company deduct, and what withholding tax must it apply to the interest paid? This article focuses on deductibility; it complements our guide to deductible expenses for corporate tax in Morocco.

What the 2026 CGI says about the deductibility of current account interest

The law provides that the following are deductible as financial expenses: “interest recorded or invoiced on sums advanced by shareholders to the company for the needs of the business” (Art. 10-II-A-2° of the 2026 CGI). The expense therefore belongs to the financial year in which the interest is recorded, not the year of payment. The same article sets three cumulative limits.

The 2026 rate cap: 2.15%

For 2026, order no. 231-26 of the Minister of Economy and Finance of 6 February 2026, published in the Official Bulletin, sets the maximum rate of deductible interest on shareholder current accounts at 2.15%. The rate is based on the average interest rate of six-month Treasury bills in 2025. It changes every year.

Withholding tax on interest paid to the shareholder

In Morocco, shareholder current account interest is fixed-income investment income (PPRF). Article 14-III of the CGI covers interest “on loans and advances granted by individuals or legal entities other than the bodies referred to in II” (credit institutions) to any person liable to corporate tax or to income tax under the actual net income regime.

This income is subject to withholding tax when it is paid, made available or entered in the account of beneficiaries whose registered office, tax domicile or establishment is in Morocco (Art. 4-II). Since Finance Law no. 43-10 (2011), entry in account “means entry in shareholder current accounts” (Art. 4, last paragraph). The withholding is made by the company that enters the interest in the account (Art. 159-I).

The rate depends on the shareholder receiving the interest:

The 20% rate requires the corporate shareholder to state its company name, registered office and its trade register (RC) and corporate tax numbers (Art. 19-IV-C). For the rates on other interest, see our article on withholding tax on interest in Morocco.

Deadlines, returns and other rules

• Payment: within the month following entry in account (Art. 171-I-A if the beneficiary is subject to corporate tax; Art. 174-II-A if subject to income tax).
• Return: the company declares the PPRF paid or entered in account before 1 April each year (Art. 153).
• Registration: deeds recording advances in shareholder current accounts have been exempt from registration duties since Finance Law no. 65-20 (2021) (Art. 129-V-9°).
• Corporate tax rate on added-back interest: 20%, or 35% for net profit of 100,000,000 DH or more (Art. 19-I-A and B).
• Cash: the cap of 5,000 DH per day and 50,000 DH per month (Art. 11-II) does not apply to financial expenses.

Key takeaways:

• In Morocco, shareholder current account interest is deductible only if the share capital is fully paid up (Art. 10-II-A-2° of the 2026 CGI).
• Sums bearing deductible interest are capped at the amount of the share capital (Art. 10-II-A-2° of the 2026 CGI).
• The maximum deductible rate is 2.15% for 2026 (order no. 231-26 of 6 February 2026), against 2.20% in 2025.
• Withholding tax is 20% for a corporate shareholder subject to corporate tax (Art. 19-IV-C) and a final 30% for an individual shareholder outside RNR and RNS (Art. 73-II-G-3°).

What the tax administration specifies

The administration specifies, in circular note no. 717 of April 2011 (volume 1, p. 163), that this interest “is deductible only on condition that the share capital is fully paid up”. This passage restates Article 10-II-A-2° of the 2026 CGI and remains valid; only the rates have changed.

The same page states that the interest is deductible “whatever its method of calculation”, in the financial year in which it is “recorded or invoiced […] and not in the year of its actual payment”. The debt must be incurred in the company’s interest and recorded on the balance sheet.

To fund new needs, the company may increase its capital or borrow from shareholders or third parties (p. 163). The “sums no greater than capital” cap stems from this choice.

A table of orders to read as history only

Circular note 717 (p. 164) publishes the table of orders from 1997 to 2011, with their number, Official Bulletin and rate. Examples: 3.48% in 2008 (order no. 729-08, OB no. 5622), 3.69% in 2009, 3.49% in 2010, 3.44% in 2011 (order no. 645-11, OB no. 5935). These rates are obsolete.

The triggering event of the withholding: entry in the current account

On the withholding, the administration specifies that “the triggering event of the withholding tax is the entry of said interest in the current account of the shareholder concerned on the due date of that interest” (circular note 717, p. 31). Circular note 717 (p. 201) confirms that advances granted by persons other than credit institutions are subject to the withholding; its rates are replaced by those of the 2026 CGI.

Clarifications in the annual circular notes

• Circular note 731 (Finance Law 2021), p. 13: deeds recording advances in shareholder current accounts are exempt from registration duties, but “nevertheless remain compulsorily subject to the registration formality with the mention ‘gratis’”.
• Circular note 735 (Finance Law 2024), p. 52: a fully exempt entity does not benefit from exemption from the withholding on PPRF; the amount withheld “does not give rise to a refund”.
• Circular note 737 (Finance Law 2026), p. 46-47: the withholding is credited against instalments, then the balance against corporate tax due, in the following order: withholding on PPRF, withholding on fees paid to third parties and rental income, provisional instalments. Any amount not credited gives rise to an automatic refund.

Finally, the tax return package includes, among its annexes, a statement showing by beneficiary the amount of interest paid on shareholder current accounts (circular note 717, p. 220-221).

Key takeaways:

• Circular note 717 (p. 163) allows the deduction of current account interest “whatever its method of calculation”, in the year in which it is recorded, provided the capital is fully paid up.
• Circular note 717 (p. 31) sets the triggering event of the withholding as the entry of the interest in the shareholder’s current account on its due date.
• Since Finance Law 2021, a deed of advance in a shareholder current account is registered free of charge (circular note 731, p. 13; Art. 129-V-9°).
• Circular note 737 (p. 46-47) ranks the withholding on PPRF first among the credits against the corporate shareholder’s corporate tax.

Cases decided by the DGI

Ruling no. 179 of 21/04/2008: how to add back excess interest

• Question: how should shareholder current account interest that does not meet the limits of Article 10-II-A-2° be added back?
• Answer: in a ruling of 21 April 2008, the DGI accepted that, if the capital is not fully paid up, the interest is added back in full; otherwise, the add-back is partial and covers the portion of sums above the share capital and the portion of the rate above the order for the year.
• Scope: not specified (ruling known through a summary).
• 2026 transposition: the ruling post-dates the CGI (2007) and Article 10-II-A-2° is unchanged; the position still applies with the 2026 rate of 2.15%.

Ruling no. 88 of 28/02/2005: entry in account triggers the withholding

• Question: does entry in account 4465 “shareholders, dividends payable” trigger withholding tax?
• Answer: yes. In this ruling, the DGI accepted that the triggering event is the handing over of funds, entry in account or making available, determined “by the date on which the general meeting is held […] and not by the accounting method”.
• Scope: IS collection 2000-2005 (p. 60-61); whether it is a general or individual ruling is not specified.
• 2026 transposition: the ruling concerns dividends and applies to interest only by analogy. For interest, the specific rule is entry in the current account on the due date (circular note 717, p. 31; Art. 4, last paragraph). Its withholding rate, prior to the CGI, no longer applies.

Ruling no. 257 of 12/03/2004: withholding passed on to the beneficiary

• Question: is a withholding on PPRF passed on to the beneficiary creditable?
• Answer: yes; in a ruling of 12 March 2004, the DGI accepted the credit provided the amount passed on is attached to the income of the year, as a “supplement to the gross amount of interest”. Surcharges and penalties are not creditable.
• 2026 transposition: under Article 159-II of the 2026 CGI, the corporate shareholder records the gross interest and credits the withholding against its corporate tax.

Ruling no. 153 of 13/02/2004: no refund for an exempt shareholder

• Answer: the DGI stated that the withholding on PPRF has general scope and that out-of-scope or exempt persons “cannot claim a right to refund”.
• 2026 transposition: this is the rule in Article 159-II, 2nd paragraph. If the lending shareholder is an association or an exempt body, the withholding is a final cost for it.

Key takeaways:

• In its ruling no. 179 of 21/04/2008, the DGI stated that current account interest is added back in full if the capital is not fully paid up.
• Under the same ruling no. 179, with fully paid-up capital, only the portion of sums above the capital and the portion of the rate above the order are added back.
• Under DGI ruling no. 257 of 12/03/2004, a withholding passed on is creditable if it is recorded as a supplement to gross interest.
• A withholding made in favour of an exempt or out-of-scope shareholder is not refundable (ruling no. 153 of 13/02/2004; Art. 159-II of the 2026 CGI).

Application in 2026: worked example

Assumptions: SARL subject to corporate tax, 2026 financial year, net profit below 100,000,000 DH. Share capital of 500,000 DH, fully paid up. Shareholder A is an employed individual, not taxed under RNR or RNS. A has a current account advance of 800,000 DH for the whole year, bearing interest at 6%. The interest is entered in A’s current account on 31/12/2026.

The withholding applies to the 48,000 DH entered in account, not only to the deductible portion: Article 14 makes no distinction. The add-back affects only the company’s corporate tax.

The SARL pays the 14,400 DH before the end of January 2027, within the month following the December 2026 entry in account (Art. 174-II-A). It declares the interest before 1 April 2027 (Art. 153). The 37,250 DH add-back appears in the reconciliation from accounting profit to taxable profit.

Variants:

Key takeaways:

• With paid-up capital of 500,000 DH and an advance of 800,000 DH at 6%, only 10,750 DH of interest is deductible in 2026 (500,000 × 2.15%).
• Withholding tax is calculated on all the interest entered in account, including the added-back portion (Art. 14 of the 2026 CGI).
• Interest entered in the current account on 31/12/2026 requires payment of the withholding before the end of January 2027 (Art. 171-I-A and 174-II-A of the 2026 CGI).

Points to watch

• Check the three limits at each year-end: paid-up capital, interest-bearing advances no greater than capital, rate of the order for the year (2.15% for 2026, 2.20% for 2025).
• Do not wait for payment: entry of the interest in the current account on its due date triggers the withholding, even without payment (circular note 717, p. 31; Art. 4, last paragraph).
• Personal liability of the company: it owes any withholding not paid over, whether or not it was actually withheld (Art. 198). The penalty rises to 20% for failure to pay or late payment of a withholding tax (Art. 208-I).
• Article 153 return: a late, missing or incomplete return triggers a surcharge of 5%, 15% or 20%, with a minimum of 500 DH (Art. 196).
• Tax return package: attach the statement of shareholder current account interest by beneficiary (circular note 717, p. 220-221).
• Entries: gross interest is credited to the shareholder’s current account, the withholding to a State account; the add-back of the excess is off-book.
• Written deed: the deed of advance remains subject to the registration formality, with the mention “gratis” (circular note 731, p. 13; Art. 129-V-9°).
• Origin of the shareholder’s funds: advances in shareholder current accounts are included in the review of the overall tax situation above 240,000 DH per year (Art. 29-8°).
• Do not use the wrong rate: a professional shareholder (RNR or RNS) is subject to 20%, not final (Art. 73-II-F-1°), not 30%.
• Questions not settled by the texts: the calculation when the balance varies during the year (average balance, pro rata temporis, date for assessing whether the capital is paid up) and the treatment of the excess interest in the shareholder’s hands are settled neither by the CGI nor by published doctrine.

Key takeaways:

• The company is personally liable for any unpaid withholding on current account interest, with a penalty raised to 20% (Art. 198 and 208-I of the 2026 CGI).
• A missing or insufficient PPRF return, due before 1 April, triggers a surcharge of 5% to 20%, minimum 500 DH (Art. 153 and 196 of the 2026 CGI).
• Above 240,000 DH per year, an individual shareholder’s current account advances are included in the review of their overall tax situation (Art. 29-8° of the 2026 CGI).

Frequently asked questions

What is the maximum interest rate on a shareholder current account in Morocco in 2026?

The maximum deductible rate is 2.15% for 2026, set by order no. 231-26 of the Minister of Economy and Finance of 6 February 2026. Article 10-II-A-2° of the CGI provides for a rate set each year based on the average interest rate of six-month Treasury bills of the previous year. It was 2.20% in 2025.

Is shareholder current account interest deductible if the capital is not fully paid up?

No. Article 10-II-A-2° of the CGI makes the deduction conditional on the share capital being fully paid up. In its ruling no. 179 of 21/04/2008, the DGI stated that the interest is then added back in full. Withholding tax remains due on the interest entered in the account.

Can a shareholder current account larger than the share capital earn interest?

Yes, but interest is deductible only on sums no greater than the share capital (Art. 10-II-A-2° of the CGI). Interest on the excess is added back to taxable income. Withholding tax nevertheless applies to all the interest entered in the account.

Which withholding tax applies to interest paid to a shareholder: 20% or 30%?

It depends on the shareholder. Company subject to corporate tax: 20%, creditable against its corporate tax (Art. 19-IV-C and 159-II). Individual outside RNR and RNS: 30%, final for income tax (Art. 73-II-G-3°). Individual under RNR or RNS: 20%, creditable and not final (Art. 73-II-F-1°). Non-resident: 10% (Art. 19-IV-B), subject to any tax treaty.

Is withholding tax due if the interest is only entered in the current account and not yet paid?

Yes. Under the last paragraph of Article 4 of the CGI, entry in a shareholder current account counts as entry in account. Circular note 717 (p. 31) sets the triggering event as the entry of the interest in the shareholder’s current account on its due date. The withholding is paid within the month following that entry.

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