Morocco cracks down on cash payments for companies

In Morocco, paying in cash is no longer just a commercial habit. For companies, it can now be costly. Control services from regional and provincial tax directorates have rejected accounting statements filed by several companies after identifying cash payments exceeding authorized thresholds.

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According to Hespress, the controls covered an initial sample of 185 companies, mainly located in Casablanca, Rabat and Tangier. Inspectors identified invoices paid in cash beyond 5,000 dirhams including tax per supplier and per day, as well as the monthly ceiling of 50,000 dirhams.

These overages are not without consequences. The expenses in question can be excluded from deductible charges. Companies also lose the right to recover VAT related to these operations and see their right to deduction under corporate income tax called into question.

Tax controllers also reportedly identified circumvention attempts. Some companies allegedly split invoices to stay below the legal threshold. But cross-checks showed that the payments concerned the same suppliers over close periods, which was interpreted as a maneuver intended to circumvent the law.

Cash is no longer a convenience

For the tax administration, the message is clear: cash payment must no longer be used to hide charges, inflate expenses or organize financial circuits difficult to trace. According to the same sources, the use of cash reportedly increased the actual cost of certain transactions by approximately 30%.

The controls also highlighted significant cash withdrawals, made in several stages after depositing crossed checks and non-endorsable checks in the name of the companies concerned. These operations attracted the attention of inspectors, who seek to verify whether they were used to escape tax obligations.

The General Tax Code strictly limits the deduction of expenses paid in cash. Purchases, services or professional expenses must be justified by regular invoices and paid by traceable means to produce their full tax effects.

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The companies concerned are now exposed to adjustments and heavy penalties. The tax authority is clearly pushing towards verifiable payment methods, such as bank transfers, crossed checks or bills of exchange. In Morocco, cash is no longer a simple convenience: it is becoming a fiscal risk.