Taxes & Accounting for Foreign Businesses in Morocco

Foreign investors in Morocco benefit from a competitive tax regime, multiple incentives, and a clear—though sometimes bureaucratic—regulatory framework. Understanding Morocco’s tax structure and accounting obligations is essential for operating successfully and compliantly. Whether you’re opening a branch, subsidiary, or representative office, knowing the local requirements will help you avoid costly mistakes and take advantage of available benefits.

Corporate Tax in Morocco

Morocco operates a tiered corporate tax system depending on the type of activity and turnover:

• Standard corporate tax: 30% for most businesses.
• Financial sector tax: 37% for banks, insurance companies, and other financial institutions.
• Reduced tax rate: 15% for businesses with an annual turnover under 3 million MAD (approx. $314,000).

Special incentives: New companies, especially in export, industrial, or strategic sectors, may qualify for temporary tax holidays or reduced rates during the first years of activity.

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Social Security & Payroll Taxes

If you employ staff in Morocco, you must contribute to the Caisse Nationale de Sécurité Sociale (CNSS). These charges apply to both employers and employees:

Employer Contributions (approx. 20.71% – 25.71% of gross salary):

• Family Allowance: 6.4%
• Social Benefits: 8.6% (capped at 6,000 MAD)
• Health Insurance: 4.11%
• Professional Training Tax: 1.5%
• Social Solidarity Tax: Progressive from 2.5%–5% depending on profits

Employee Contributions (approx. 8.05% of gross salary):

• Social Benefits: 4.29%
• Health Insurance: 2.26%
• Social Solidarity Tax: 1.5% for annual incomes above 120,000 MAD

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Individual Income Tax Rates

Morocco applies progressive personal income tax rates:

Annual Gross Income (MAD)	Tax Rate
0 – 30,000	0%
30,001 – 50,000	10%
50,001 – 60,000	20%
60,001 – 80,000	30%
80,001 – 180,000	34%
Above 180,000	38%

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Social Solidarity Tax on Companies

Companies pay an additional solidarity tax on profits:

• 2.5% – 5% for profits from 1 million to 40 million MAD
• 5% for profits above 40 million MAD

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VAT (Value-Added Tax)

• Standard rate: 20%
• Reduced rates: 7%, 10%, and 14% for specific goods and services (e.g., transport, tourism, electricity)
• Exported goods and services: 0% VAT (with the right to recover input VAT)

Foreign businesses involved in import/export should register for VAT and comply with quarterly declaration requirements.

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Double Tax Treaties & Profit Repatriation

Morocco has dozens of double taxation treaties with Europe, Africa, the Middle East, and the US. These agreements prevent foreign businesses from being taxed twice and often reduce withholding taxes on dividends, interest, and royalties.

Profits can be freely repatriated in convertible currency, subject to compliance with Morocco’s foreign exchange rules.

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Accounting Standards & Bookkeeping

Morocco follows the Plan Comptable Marocain (PCM), a national accounting system similar to IFRS but with local adaptations.

Foreign businesses must:

1. Keep accounting records in Morocco (in French or Arabic)
2. Maintain journals, ledgers, and inventory books in compliance with PCM
3. Prepare annual financial statements (balance sheet, income statement, cash flow statement)
4. Submit tax declarations within set deadlines

Annual accounts must be signed by the company’s legal representative and, for certain entities, audited by a statutory auditor.

No need to worry if you’re not fluent in French — at BH Adviser, our English-speaking accounting and tax experts handle all local compliance for you, ensuring your records meet Moroccan standards while communicating with you clearly in English.

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Tax Filing Deadlines for Companies

• Corporate tax declaration: Within 3 months after the fiscal year-end (generally March 31 for companies using the calendar year)
• VAT returns: Monthly or quarterly depending on turnover
• CNSS declarations: Monthly

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Common Tax Incentives for Foreign Investors

According to the New Investment Charter, incentives include:

• Exemptions or reductions in corporate tax for a set number of years
• VAT exemptions on imported capital goods
• Customs duty exemptions for industrial equipment
• Regional tax reductions for investments in less-developed areas

Special industrial zones (e.g., Tangier, Kenitra) offer favorable tax regimes for manufacturing and export-oriented companies.

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Best Practices for Compliance

1. Work with a local accountant familiar with Moroccan PCM and tax law
2. Keep digital and paper copies of all invoices, payroll records, and bank statements
3. Plan for social security costs when budgeting salaries
4. Use double tax treaties to optimize international operations
5. Review annual tax law changes to capture new incentives or avoid penalties

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Conclusion

Morocco offers foreign businesses a competitive tax regime, social security structure, and generous incentives—but also demands careful compliance with local accounting and filing rules. Partnering with experienced Moroccan tax professionals ensures your business stays compliant, avoids penalties, and maximizes available benefits.

If you’re considering expanding to Morocco, a tailored tax & accounting strategy will not only protect your business but also enhance profitability from day one.

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FAQ – Taxes & Accounting for Foreign Companies in Morocco

1. Do foreign companies pay higher corporate tax in Morocco?

No. Morocco applies the same rates to local and foreign companies, except for the financial sector, which has a higher rate.

2. How quickly can profits be repatriated from Morocco?

Once all tax obligations are met, profits can be repatriated freely in convertible currency, following foreign exchange procedures.

3. Is VAT registration mandatory for foreign businesses?

Yes, if your company supplies taxable goods or services in Morocco.

4. What accounting system does Morocco use?

Morocco uses the Plan Comptable Marocain (PCM), adapted from IFRS.

5. Can I benefit from tax holidays?

Yes, certain sectors and regions offer corporate tax exemptions for initial operating years.