MRE property owners: 5% withholding tax on rent takes effect July 2026
The 2026 Finance Law introduces a 5% withholding tax on rental income from July 1, 2026. Moroccans abroad who own rented property in Morocco are directly affected. Here is what to do before the deadline.
The 2026 Finance Law introduces a 5% withholding tax on rental income from July 1, 2026. Moroccans abroad who own rented property in Morocco are directly affected.
What changes on July 1, 2026
A 5% withholding tax on gross rent excluding VAT will be levied on rent paid to companies subject to corporate tax or individuals under professional income tax. Implementation is progressive: first the State, banks, insurance companies and large enterprises (turnover of 500 million MAD or more), then companies with turnover above 350 million MAD from January 2027.
Concrete impact for Moroccans abroad
If you rent a commercial space or apartment to a business or professional in Morocco, your tenant must withhold 5% of rent and remit it to the tax authority. This is not an additional tax: it is a credit against your final income tax. If the amount withheld exceeds tax due, you can request a refund.
Risk for non-declarers
The measure considerably strengthens rental income traceability. The tax authority now has automatic cross-referencing between ANCFCC data, banks, and tax declarations. MRE who have never declared rental income face increased fiscal risk. The limitation period is 4 years, but 10 years in case of total failure to declare.
Regularize before July 2026
It is strongly recommended to regularize your situation before the deadline. Compile a complete file and submit missing declarations on tax.gov.ma.
Good to know: exemption threshold
Since 2025, net annual rental income below 40,000 MAD is tax-exempt. If your gross annual rent does not exceed about 66,700 MAD (roughly 5,560 MAD per month), you pay no tax after the 40% allowance.
Learn more
Read our complete guide Rental income in Morocco 2026 for calculation details and regularization procedures. For income declared in both France and Morocco, our guide MRE income tax declaration explains how to avoid double taxation.
Related practical guides
Have a project in Morocco?
Find a LesMRE-verified expert to guide you through your steps.
Find an expert →