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FAQ´s Morocco
- Who can buy Property in Morocco?
- Can I get a mortgage in Morocco?
- Do I need to open a bank account in Morocco?
- What are the additional required purchasing costs?
- Are there ongoing costs besides water and electricity associated with a property purchase?
- What is the Capital Gains Tax situation in Morocco?
- Are there any annual property taxes?
- How much is the inheritance Tax?
- What tax do I have to pay on rental income?
- How much is the Corporate Tax in Morocco?
1) Who can buy Property in Morocco?
Any investor, resident or overseas buyer can purchase property in Morocco. Residents from any country in the EU or the USA.
2) Can I get a mortgage in Morocco?
Yes. Mortgages are available on Moroccan properties of between 60% - 70%, depending on your personal situation. The current rate is from 5.5% variable to 7% fixed.
3) Do I need to open a bank account in Morocco?
Yes. You will need to have a Moroccan bank account but only in time for the completion of the purchase. We will ensure that you are instructed of exactly what is required from you at all stages of the purchase.
4) What are the additional required purchasing costs?
Generally in Morocco around 5% - 6% is required in addition to the property purchase price to secure your property. These fees are broken down further in the example below:
5) Are there ongoing costs besides water and electricity associated with a property purchase?
As with most countries there are additional community fees but these are not usually expected to exceed €60 pm.
The Morocco tax system is modelled after the French system and has quite a few complexities. We always consult and work closely with our international tax advisers prior to offering our investors tax reduction strategies. The following information is a very basic guide to the Morocco tax implications for UK investors.
Please remember that the Moroccan tax system is quite complex so always get expert tax advice before making an investment.
6) What is the Capital Gains Tax situation in Morocco?
There is no Capital Gains Tax (TPI) if you sell after 10 years of ownership. Sales made between 5 and 10 years are subject to 10% of the profit if more than 1 million DRh (about €90,000) or 20% if sold within 5 years. There is a double tax treaty between the UK and Morocco to ensure that this is not paid in both countries.
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7) Are there any annual property taxes?
You are exempt for the first 5 years of ownership. After 5 years you receive a 75% discount if the home is your holiday home or your permanent residence! Tax ranges from 0% - 30% depending on property value.
8) How much is the inheritance Tax?
It is 0% for family members. We recommend that you make a Moroccan will.
9) What tax do I have to pay on rental income?
Morocco offers some favourable tax options to overseas property investors. You are exempt for the first 3 years from paying income tax. After 3 years UK investors will pay income tax on 60% of the income. In Tangiers 60% of this income is taxable at 22% (other parts of Morocco are taxed at 44%). The city of Tangiers has a 50% reduction on rental income tax adding yet one more advantage to invest in Tangiers. However, if you are an investor only, as opposed to letting your holiday home, you will pay 13.50% on the rental value of the property!
Read more about investing in Morocco.
10) How much is the Corporate Tax in Morocco?
If you intend to purchase a number of Moroccan properties it may well be worth considering establishing a Moroccan Private Limited Company (SARL) which can take just 3 weeks. The SARL is an intermediate type between associations of persons and of capital, bearing resemblance to both partnerships and share companies. It is always a trading company, regardless of its corporate name and its minimum equity capital is 100,000dh. It may be formed by two or more members who are only liable to the amount of their share of the equity capital in the company. Unlike a general partnership, members of a private limited company do not need to be registered merchants. The private limited company must file a memorandum of association as part of its incorporation process. The capital stock has to be fully described and paid up as the company is formed. Stocks shall have the same face value and are not negotiable; they may be transferred only through contracts. "Parts Sociales" may be transferred to third parties outside the company only with the co-associates' consent. Tangier is 50% of the tax rate in the rest of the country. Tax is currently 8.75% for the first 5 years and 17% after 5 years.
