Morocco's Finance Law 2026 introduces a new measure affecting professional landlords and their tenants: from 1 July 2026, rent paid to certain categories of property owners will be subject to a 5% withholding tax, deducted directly by the tenant at source. This guide explains who is affected, how the mechanism works, and the practical impact.
Who is affected?
Landlords (lessors) concerned
| Landlord status | Tax regime | Withholding applied |
|---|---|---|
| Individual (IR) | RNR or RNS | 5% from 01/07/2026 |
| Legal entity (IS) | Corporate tax | 5% from 01/07/2026 |
| Individual (rental income, Art. 61-I CGI) | Simple rental income | Not concerned |
Individuals earning rental income under the simplified rental-income regime (Article 61-I of the CGI) are not covered by this withholding. It targets professional landlords – those taxed under RNR/RNS or IS.
How does the withholding work?
The tenant (a legal entity or IR taxpayer) withholds 5% from the gross rent amount at payment time.
Monthly gross rent MAD 10,000
Withholding at source (5%) MAD 500
Amount paid to landlord MAD 9,500
The tenant must remit the withheld amount to the Treasury within the month following payment, together with a detailed rental schedule, via the DGI's SIMPL platform. This mirrors the broader 2026 trend toward withholding at source.
What does this mean for the landlord?
The withholding is an advance credit deductible from the final IR or IS due for the year. It is not an additional tax: if your annual tax bill is lower than the total amounts already withheld, the excess is refundable.
Landlords declare their rental income at the gross amount before withholding, then impute the withheld amounts – exactly like other non-libératoire withholdings. If you also receive an exempt pension, note that rental income still triggers the annual filing obligation.
Worked example: annual reconciliation
Annual gross rent MAD 120,000
Withheld over the year (5%) MAD 6,000 (advance)
Landlord's final IR/IS on rent MAD 4,000 (example)
→ Excess withheld refundable MAD 2,000
Why this measure?
The DGI aims to improve traceability of professional rental income and combat under-reporting in the real-estate sector, in line with the fiscal-equity objectives of the 2023-2026 reform roadmap. It is part of the same shift toward collection at source seen in the RAS on services.
FAQ
Do all landlords pay the 5% rental withholding?
No. Only professional landlords under RNR/RNS or IS. Individuals under the simplified rental-income regime (Art. 61-I CGI) are excluded.
Is the 5% an extra tax?
No – it is an advance imputed against the final IR/IS. Excess withholding is refundable.
When must the tenant remit the withholding?
Within the month following the rent payment, via the DGI SIMPL platform.
Sources
- Direction Générale des Impôts (DGI) – tax.gov.ma
- Note circulaire n° 737 – DGI
- Code Général des Impôts 2026 (Art. 61-I) – finances.gov.ma
Disclaimer
This article is for general information only and does not constitute tax or legal advice. Refer to DGI circular note 737 and the CGI for the exact provisions.
Marouan focuses on corporate taxation, VAT, and business compliance in Morocco. He writes practical guides that help entrepreneurs and companies navigate the Moroccan tax system with confidence.
