Real estate in Morocco taxation & legal – Agencimo

BEFORE the PURCHASE :
Banking steps - opening of an account in dirhams convertible

As of your arrival in Morocco and in order to hold it although you will have allured, the first step will be to open near a convertible bank an account in dirhams. You will be able to feed your account since the foreigner by transfer SWIFT.
The naps coming from abroad must pass by this account which will enable you to carry out your operation of investment in Morocco and the transfer of the product of this investment will guarantee to you. The Moroccan Foreign exchange bureau must imperatively be informed by the Notary of the transaction that you realize in order to be able to profit, in the event of resale, of the repatriation of the funds and the related appreciation.

AT THE TIME of The PURCHASE :
Expenses of acquisition of a real estate in Morocco

The purchaser of a real estate in Morocco is indebted expenses of acquisition (right and taxes) and apply to amount including all taxes of the acquired good. They are the "transfer taxes" to which the fees of the notary are added. The notarial acts are recorded and the change declared with the Land Conservation.

RIGHTS AND TAXES	Dwelling houses for one duration 3 years or undeveloped site with commitment to build within 7 year	Commercial premises or undeveloped site without commitment to build
Fees registration	2,5 %	2,5 % (*)
Notarial tax	0,5 %	0,5 %
Land conservation	1% +150Dhs (certificate of property)	1 %
Fees of the notary	1 % (with minimum of 2500 Dhs) + VAT 7%	1 % (with minimum of 2500 Dhs) + VAT 7%
of constructions to the land conservation (if necessary)	0,5 % + 75 Dhs
Others (stamps...)	From 1500 to 3000 Dhs according to files'	From 1500 to 3000 Dhs according to files'

(*) : 5% or 2,5% of the first sale of a commercial room, fee registration brought back to 2,5 %

The follow-up of the file to the Foreign exchange bureau requires some additional expenses and can be differed in time.

In the event of acquisition of a good not titrated (melkia), it is necessary to add the expenses of titration which depend on the surface on the ground and the price of the acquired good. They can be possibly divided with the salesman.

- Rights of publication: 450 Dhs
- Ad valorem Rights: 1,5 % up to 50 000 Dhs + 2 % of the value above
- Rights on surfaces: 45 Dhs per started are (urban zone), per started hectare (rural zone)
- Right fixed: 75 Dhs - Duplicate: 75 Dhs
- Geometrician: 2 approximately 500 Dhs - Others (stamps, etc.) : approximately 1500 Dhs.

Agricultural land in Morocco

In Morocco, the law prohibited with foreigners to buy grounds located apart from the urban perimeter, which are classified in agricultural land. To make its acquisition possible, it is possible that the State changes the legal nature of the ground and classifies it with nonagricultural vocation (VNA). A file will have to be set-up.

IN POSSESSION OF THE GOOD :
Taxes and taxes had by the owners

• Taxes which had by the owners:

• The owner of a real estate in Morocco is indebted of 2 taxes: the Urban tax (YOU) and taxes it with municipal administration (TE).
•  The Urban Tax (T.U.) : Your principal or secondary dwelling is subjected to the urban tax. This tax sat on the rental value of housing, determined by way of comparison or direct appreciation by the commission of census.
• The rental value is revised every 5 years by an increase of 2 %. Concerning the principal dwelling an abatement of 75% of the rental value being used as a basis for calculation of the urban tax is applied.

 

Applicable rate of TU:

(*) :Are exonerated from the urban tax - during 5 years starting from the delivery of the licence to live the new buildings and additions of construction.

The Tax of Municipal administration (T.E.) : The Tax of municipal administration is it also sat on the rental value, including that of the buildings temporarily exonerated, and on the total amount of the rents in the event of hiring.

Applicable rate of TE :

- 10 % of the rental value for the buildings located in the urban communes

- 60 % of the rental value for the buildings located in the peripheral zones of the urban communes. If the building is intended for the principal dwelling, you profit from an abatement of 75 % as well as for the urban tax.

• Taxes had by the owners on the land incomes

The incomes coming from the hiring from the built buildings and not frames are regarded as land gross incomes. The land income taxable Net (subjected to the IGR) is obtained by applying an abatement of 40 % to the amount of the gross income land.

 The incomes are exonerated coming from the hiring from new constructions and additions of construction, during the 3 years which follow that of completion of the aforesaid constructions.  

 

SCALE Of the I.G.R:  

To put an example :

Annual declaration of the total income

You must absolutely complete an annual declaration of total income to the title of the incomes which you will have perceived the past year, at the latest on March 31 of each year, and this, to avoid any fine or penalty of delay

 

AT THE TIME OF THE SALE OF THE GOOD:
Taxes and taxes had by the owners

Taxes which had by the owners:

Tax on the land Profits or Taxes on the profits Immobiliers (TPI) If you yield your good to Morocco (a construction or a ground), the profits which you will carry out are subjected to the General Tax on Income (IGR) at the rate of 20 % with a minimum to pay of 3 % of the delivery price. Nevertheless, you are exonerated from this tax if it had acted of your principal dwelling for at least 8 years at the day of the aforementioned transfer (with one six (6) months period as from the date of the vacancy of housing) or if it acts of a transfer on a purely free basis between ascending and downward and between husband, brothers and sisters land

Profits = [ delivery Price - expenses of transfer ] - brought up to date Value [ Price of acquisition + fresh of acquisition + possible capital expenditures + possible banking interests ]

Nota :

* The expenses of acquisition are evaluated contractually to 15 % of the price of acquisition, except if the taxpayer can justify that these expenses rise with a higher amount.

* The capital expenditures mean capital expenditures of ground, construction, rebuilding, enlarging, restoration and improvement duly justified.

* Brought up to date value = the price of acquisition, increased as it is known as above, is revalued by multiplying this price by the coefficient corresponding to the year of acquisition,

calculated by the administration on the basis of national index of the cost of living. A declaration must be given against receipt to the receiver of the tax authorities in the 60 days which follow the date of the transfer at the same time as the payment of the tax.

To take its retirement in Morocco ?

The foreign pensioners residents in Morocco are given a very weak imposition. The State Marocain grants to them, as to the Moroccan pensioners, an abatement of 40 % on their assessed incomes and still reduces by 80 % the amount of the tax due under their pension and corresponding to the sums transferred on a purely final basis on an account in dirhams to Morocco (it is not necessary to transfer 100% from its retirement!). It thus remains to them largely of what to live, and even of living very well.