Morocco Introduces New Tax Rules for Rental Agreements, Deadline Looms

Landlords who prefer to pay the IT on rental income themselves have the obligation to provide their tenant with a declaration of option, says L’Economiste. This is a mandatory document that tenants must receive from landlords in order to avoid withholding the IT at source. Failure to comply with this rule can result in the penalties provided for in the General Tax Code.

The same source indicates that the expiration deadline is set for the end of February. The only problem is that the declaration of option is a recurring formality that landlords are required to comply with. Obviously, the burden will fall on them. Especially since "common law requires systematically withholding tax on the rent paid to the landlord. And this role of tax collector on behalf of the treasury, the legislator attributes it to the tenants".

Theoretically, it is a matter of withholding 10% on taxable gross rental income below 120,000 dirhams and 15% beyond. Then the tenant will pay the tax withheld to the treasury no later than the following month. This measure aims to fight against tax evasion on rental income.