• Literary and art awards amounting to a maximum of MAD100,000 per year
• Premiums and benefits granted to employees as tourism vouchers
• Invalidity pensions paid to service persons and their successors starting from January 2020]
• Allowances awarded to trainees up to a maximum of MAD6,000 per month for 12 months
• Pensions and retirement revenues paid under primary pension regulations
• Remuneration and similar income paid by Fédération Internationale de Football Association (FIFA; “International Federation of Association Football” in English) representations in Morocco to their staff who do not have Moroccan nationality
The 2021 Finance Law provides for the exemption of salaries paid by employers to employees newly hired during the period starting 1 January 2021 and ending 31 December 2022 for a period of 36 months from the date of hiring. The 2023 Finance Law extended until 31 December 2026 the 36-month exemption from income tax, applicable to employees at their first recruitment. Such exemption is subject to the following conditions:
• The employee must be hired under an open-ended contract.
• The employee’s age must not exceed 35 years old.
In addition, for the period of 1 January 2015 through 31 December 2026, gross salary capped at MAD10,000 per month paid by newly created companies during the 24 months starting from their incorporation to employees (up to a maximum of 10 employees) hired under unlimited duration contracts is exempt from tax. This exemption is granted for 24 months, starting from the employee’s hiring date.
Self-employment and business income. Self-employed individuals are divided into two taxable categories, depending on the nature of their activities. They may be taxed on commercial and professional income or on agricultural income.
Individuals earning agricultural income and generating annual turnover of less than MAD5 million with respect to such income are permanently exempt from income tax.
However, if the income derived from agricultural farms is less than MAD5 million, the exemption mentioned above is granted only if such income has remained under this amount for three consecutive years.
Self-employed individuals’ services providers subject to individual income tax fall into the following three categories:
• Unique professional contribution (CPU) regime
• Auto-entrepreneurs regime
• Actual Net Income (RNR) or Simplified Net Income regime (RNS)
The taxable income for individuals whose professional income is determined according to the CPU and auto-entrepreneurs regimes is computed based on annual turnover. The tax base for selfemployed individuals subject to the RNR or RNS regime is computed in the same manner as the tax base for corporations. Taxable income equals the difference between gross income and
This exemption is subject to the following conditions:
• The difference between the vesting price and exercise price may not exceed 10% of the share value at the date of vesting. Any excess is considered salary and is subject to income tax.
• The sale of the shares may not occur within a three-year nonavailability period beginning with the exercise date.
This exemption is provided only for stock options issued by Moroccan companies.
Stock options, free shares or any other process to buy shares granted by Moroccan companies to their managers and employees, or granted by companies not resident in Morocco to managers and employees employed by Moroccan companies or branches of the nonresident companies, must be declared by the Moroccan entity in its annual salary return filed before 1 March of the year following the year of the acquisition or of the distribution of the shares.
Stock saving plans and company saving plans. Gains (interest or profit from sales) derived from stock saving plans and company saving plans benefit from exemption provided that contributions and capitalized revenues are maintained during at least five years and the total amount of contributions does not exceed MAD2 million.
Capital gains. Gains derived from the sale of real property held by an individual are subject to the tax on real estate profits at a 20% rate.
The minimum tax is 3% of the transfer price. However, gains derived from the sale of real property amounting to a maximum of MAD140,000 per year are exempt.
Individuals will also be liable for the payment of the following complementary taxes.
Capital gains derived by resident individuals from the sale of shares of resident companies are taxed at a rate of 15% for listed shares and 20% for unlisted shares. Capital gains derived from the sale of shares of nonresident companies are taxed at a rate of 20%. Capital gains derived from the transfer of an individual’s business assets, including real property, are taxed at the same rates as ordinary income.
Capital gains derived from the contributions of securities held by an individual in companies to a holding resident company subject
The Social Contribution for Solidarity is applicable for 2022, 2023, 2024 and 2025 fiscal years.
Individuals subject to the Social Contribution for Solidarity must submit a declaration by electronic means, according to a model established by the administration, specifying the amount of income net of tax and the amount of the contribution relating to it, before 1 June of each year.
Estate and gift taxes. Estate and gift tax rates range from 1% to 6%, depending on the nature of the assets and operations and the relationship between the recipient and the deceased or the donor.
C. Social security
Social security contributions, which are withheld by the employer, are based on gross compensation paid, including fringe benefits and bonuses.
Employer contributions are paid, and employee contributions are withheld and paid, monthly. The employer must pay 6.4% of gross monthly compensation for family allowances. For death pensions and for daily compensation for illness, disability and pregnancy leave, employers must contribute 8.6%, and employees 4.29%, of gross monthly compensation, capped at MAD6,000. In addition, the employer must pay 1.6% of gross monthly compensation as a contribution to the Moroccan office of staff training.
An additional contribution for “loss of employment indemnity” is payable. Employers must contribute 0.38%, and employees 0.19%, of the gross monthly compensation, capped at MAD6,000.
Contributions on monthly gross remuneration are payable for mandatory medical insurance. The contribution rates are 2.26% for employees and 4.11% for employers, except for companies exempted from this mandatory medical insurance, which pay at a rate of 1.85%. This exemption is provided for companies that were set up before 2005 and that are already contributing to private medical insurance.
D. Tax filing and payment procedures
The tax year in Morocco for individuals is the calendar year. Moroccan residents must file annual general income tax returns before the following dates:
• 1 March following the end of the tax year (28 February or 29 February at the latest) for individuals who have professional income taxed under the fixed-taxation system (see Section A), and/or income other than professional income.
• 1 May following the end of the tax year (30 April at the latest) for individuals who have professional income taxed under the
have valid work permits and residence permits to be selfemployed. The minimum amount of share capital required to set up a company in Morocco depends on the form chosen (MAD300,000 for the incorporation of a PLC [société anonyme] and no required minimum share capital for the incorporation of an LLC [société à responsabilité limitée]).
H. Residence permits
Residence permits are issued for a period of one to 10 years and may be renewed several times. The renewed residence permit is also valid for the same period.
To obtain a residence permit, the foreigner should file his or her application personally before the police authorities. In order to obtain the residence permit, the foreigner should submit several documents to the police authorities, such as a copy of his or her work permit issued by the Ministry of Employment, a lease agreement and a medical certificate issued by a Moroccan doctor, etc.
I. Family and personal considerations
Family members. Family members who intend to reside with a foreigner in Morocco should also obtain a residence permit. The application for the residence permit for dependents may be made as soon as the foreigner has obtained his or her residence permit.
The spouse or dependents who intend to work in Morocco should independently apply for a work permit.
Driver’s permits. The foreigner is authorized to drive with his or her foreign driver’s license for a period of one year from the obtaining of his or her residence permit. After this period, the foreigner should obtain a Moroccan driver’s license.