Morocco’s Hidden Tax Trap: Expat Dream Homes Face Costly Square Meter Surprise

The turning point is at 300 square meters. It is the built-up area that determines whether the owner will have to pay or not. Below this threshold, a total exemption is applied. But the devil is in the details: as soon as the surface area exceeds this limit, even by one square meter, it is not the surplus but the entire surface area that becomes taxable under the "social contribution of solidarity on self-deliveries of personal housing construction".

The calculation of this levy follows a progressive scale that applies per square meter on the total surface area. The amount to be paid thus increases in stages:

• Exemption for a surface area up to 300 m²;
• 60 dirhams/m² for a surface area of 301 to 400 m²;
• 100 dirhams/m² for a surface area of 401 to 500 m²;
• 150 dirhams/m² for a surface area exceeding 500 m².
• The tax administration specifies its definition of the "housing unit", considering it as an "indivisible" construction that has been the subject of a "building permit".

Far from being a simple financial formality, this measure is accompanied by a real administrative obstacle course. MRE project owners are required to comply with strict reporting obligations. From the start of the work and until the precious permit to live is obtained, an annual declaration of the cost of the construction must be filed on the online platform of the General Directorate of Taxes.

This annual declaration must be particularly meticulous and accompanied by precise supporting documents:

• A detailed statement of all expenses incurred (amounts excluding tax, identity of suppliers, payment methods, etc.).
• An architect’s certificate on the estimated cost of the work or, failing that, a copy of the turnkey contract.
• Once the construction is completed and the permit to live is issued, a final race against the clock begins: the taxpayer has a deadline of 90 days to submit a specific final declaration for this solidarity contribution to the competent tax administration receiver, accompanied by the permit to live and the initial building permit.

An important nuance is however brought by the tax guide. Occasional constructions, even if they are carried out by individuals, are not subject to this contribution when they are intended from the outset for sale or rental, provided that their surface area remains less than 300 m². An exception that clarifies the scope of this tax, resolutely focused on large personal residences.