Morocco’s New Tax Rules Shake Up Rental Income for Expat Landlords

The 2025 tax guide specifies that the taxable gross rental income, received from properties rented to public or private legal entities, or to individuals whose professional income is determined under the actual net result or simplified net result regime, is subject to withholding tax.

Two rates are provided depending on the level of annual gross income:
• 10% for an annual gross income of less than 120,000 dirhams
• 15% for an annual gross income of 120,000 dirhams or more

These rates are non-liberatory. This means that the amount withheld by the tenant is deductible from the total amount of income tax owed by the owner for the year in which the income was received. The taxpayer is therefore still required to file an annual global income tax return and pay the corresponding tax, before March 1 of the following year.

However, a provision introduced in 2025 now allows the taxpayer to opt for a liberatory rate of 20% on the gross amount of rental income subject to this withholding tax. In this case, the deduction made serves as the final settlement of the tax. The taxpayer is then exempted from filing the annual global income tax return for the portion of their income that has been subject to this liberatory withholding.

The choice between these regimes therefore implies different obligations. If the 20% liberatory rate is chosen, the declarative obligation is lifted. Otherwise, the taxpayer is required to electronically file their income tax return, via the SIMPL portal.