Rent received by an individual in Morocco is property income, subject to income tax. How it is taxed depends mainly on who the tenant is: a business or an individual.
The basic calculation: a 40% allowance
Taxable property income is obtained by applying a flat 40% allowance to the gross rent, meant to cover the owner’s costs. The tax is then calculated on the progressive income tax scale, from 0% to 37%, together with the household’s other income.
Example: MAD 100,000 of gross rent in the year gives net property income of MAD 60,000, added to the owner’s overall income.
When the tenant is a business: withholding tax
When rent is paid by a legal entity, public or private, or by an individual whose professional income is taxed on the actual or simplified net income regime, the tenant must apply a withholding on the gross rent:
| Annual gross rent | Withholding rate |
|---|---|
| Under MAD 120,000 | 10% |
| MAD 120,000 and over | 15% |
This withholding is not final: the owner declares the income and offsets the withholding against the tax calculated on the scale, with any excess refunded.
The 20% final-tax option
Since 2025, the owner may opt for a final rate of 20% on the gross rent subject to withholding. The tax deducted by the tenant is then final for that income, and the owner does not have to declare it.
Which option to choose? The final rate is simple, but it applies to gross rent. The scale, after the 40% allowance, may be more favourable for an owner with modest other income. Do the calculation case by case.
When the tenant is an individual
No withholding applies. The owner must declare the property income and pay the tax themselves, online on the Tax Directorate (DGI) portal, before 1 March of the year after the rent was received.
What changes in 2026
The 2026 Finance Act introduces a 5% withholding on certain rents paid to individuals who let property recorded as business assets, from 1 July 2026. It is offset against the tax due. It does not apply to an individual letting private property, which remains under the rules above.
Points to watch
- Housing provided free of charge to people other than parents and children: it may be taxed on a rental value basis.
- Non-resident owners, including Moroccans living abroad: Moroccan-source rent remains taxable in Morocco, subject to tax treaties.
- Furnished lettings and quasi-hotel activities: depending on the case, these may be professional income rather than property income.
- Municipal services tax: due in addition, on the rental value.
In short
- 40% allowance, then the progressive scale.
- 10% or 15% withholding if the tenant is a business, offset against the tax.
- 20% final-tax option since 2025.
- Return before 1 March if the tenant is an individual.
Ascensu supports individuals and companies with their tax returns, including property income.
Official sources
This article is provided for general information, as at its publication date. It is not personalised advice: the rules change and every situation must be reviewed on its own facts.