Morocco’s Hidden Real Estate Tax: 3% Minimum Even Without Profit

This principle applies to all taxpayers subject to income tax on real estate profits (IR/PF). It particularly concerns Moroccans residing abroad who sell a house, apartment, land or even an undivided share of real estate.

Even without capital gain, the tax authorities collect 3%

The text is clear:

"You are required to pay a minimum tax, even in the absence of profit, which cannot be less than 3% of the transfer price."

In other words, if you sell a property at a loss, or if you believe that you are not making any real profit, the tax authorities will apply a floor rate: 3% calculated on the total amount of the selling price.

This rule prevents taxpayers from declaring a false deficit or a zero margin to avoid taxes.

A rule that applies even in case of exemption

Even if you benefit from the exemption under the main residence, another minimum tax may apply in some cases:

"You must pay a minimum tax of 3% on the portion of the selling price that exceeds the amount of 4,000,000 dirhams for transfer operations concerning a building or part of a building, occupied as a main residence and whose profit is exempt."

This means that even if the exemption from the tax on real estate profits is validated, you will pay at least 3% on the portion of the selling price exceeding 4 million dirhams.

Who is concerned?

This minimum of 3% applies to:
• Any sale of a built or unbuilt property (land, apartment, villa, garage, etc.),
• Any transfer of undivided rights on a real estate property,
• Any non-exempt or even exempt operation but exceeding the threshold of 4 M DH.

An obligation to declare within 30 days

The seller must:
• Declare the transfer within 30 days following the date of the sale,
• Electronically pay the tax due, even if it is only the minimum of 3%.

The declaration and payment must be made online, via the portal of the General Directorate of Taxes (DGI).

What to remember if you carry out a real estate sale in Morocco:

- Even without profit, you will have to pay a minimum of 3% of the selling price to the tax authorities.
- This rule applies even if you are exempt, as long as the amount exceeds 4 million dirhams.