Have questions? Ask us!

Payroll & Tax in Morocco

Morocco payroll & taxation

Foreign companies operating in Morocco may find it challenging to deal with the complexities of the country’s tax system. The primary concerns for a foreign company that needs to comply with tax laws in Morocco are: Individual income tax (IIT) for employees in Morocco, social security costs, VAT, withholding tax, business tax and permanent establishment concerns.

Your Payroll Options in Morocco

Remote Payroll

A remote payroll in Morocco is where a foreign company, i.e. a non-resident company, payrolls a resident employee in Morocco. This applies to both local and foreign employees. One option for a non-resident company to payroll its employees (local and foreign) in Morocco is to use a fully outsourced service like a GEO or PEO which will employ and payroll the staff on their behalf.

Local Payroll Administration

In some cases, a company will register their business in Morocco under one of the forms available but prefer to have another company administer its payroll. This can be accomplished through a payroll provider. It is important to note that the company, as the Employer of Record, is still fully responsible for compliance with employment, immigration, tax and payroll regulations. But the payroll calculations, payments and filings can all be outsourced to the payroll provider.

Internal Payroll

Larger companies with a commitment to Morocco may wish to run their own local payroll for all employees, foreign and local. In order to accomplish this, they will have to complete the incorporation, register the business and then hire the necessary staff. There will be a need for in country human resources personnel who have the background needed to manage a Moroccan payroll and can fulfil all tax, withholding tax and payroll requirements.

This approach carries significant cost and requires some knowledge of local employment and payroll regulations. The company will need a local accounting firm and potentially legal counsel to ensure full compliance with Moroccan employment laws.

Fully Outsourced Payroll & Employment

Companies can outsource the employment and payroll of their staff in Morocco to a GEO, like Shield GEO. This is possible for both foreign workers and Moroccan nationals. This is the easiest, fastest and safest way to payroll staff in Morocco.

Shield GEO manages all aspects of payroll for workers in Morocco, including taxes, withholding, social security payments and other statutory requirements. Shield GEO becomes the Employer of Record and employs the staff on behalf of the client.

Staff are paid monthly with tax and social security deducted at source and paid to local authorities. Shield GEO will invoice the client monthly in advance of the payroll date. The invoice consists of the Total Cost of Employment (Base salary + Employers Statutory Contributions + Additional statutory contributions) and a Management Fee. Shield GEO provides the employees with payslips.

Read more about outsourced payroll and employment through Shield GEO.

Jump to...

Setting up payroll in Morocco

Information Explanation
Currency ?

Morocco dirham, MAD

Tax Figures

Information Explanation
Corporate Income Tax ?

The current corporate income tax rate (impôt sur les sociétés) is 30%. However, a special rate of 37% applies to insurance and banking and financial institutions.

Preferential rates apply to companies with a taxable income of MAD 300,000.

Income Tax Rate ?
Grossed income Tax Rate (%)
0 - MAD 30,000 0
MAD 30,001 - 50,000 10
MAD 50,001 - 60,000 20
MAD 60,001 - 80,000 30
MAD 80,001 - 180,000 34
Above MAD 180,001 38
Payroll Tax ?

No

Sales Tax ?

VAT is imposed on the supply of taxable goods and services in Morocco. Taxable persons charge VAT on their taxable supplies (output tax) and are charged with VAT on goods  which they receive (input tax).

The current standard rate of VAT imposed on taxable goods and services is 20%, with reduced rates of 14%, 10% and 7%.

Withholding Tax ?

Morocco imposes withholding tax (WHT) on certain classes of income earned by non-residents:-

  • Dividends: 15%
  • Royalties, patents, know-how, technical assistance fees and remuneration for most services: 10%
  • Interest: 10%/20%/30%
  • Rental on equipment: 10%
  • Indemnity for non-permanent employees: 30%
 A reduced rate may be available under an applicable Double Tax Treaty.
Employee Social Security (EE SS)

Employees are required to make the following contributions:

1. Death and other daily compensation for illness, pregnancy etc: 4.29% (capped at MAD 6,000)

2. Mandatory health insurance: 2.0% (uncapped)

For more details, please refer to the section on Employment.

Employer Social Security (ER SS)

Employers are required to make the following contributions:

1. Family benefits: 6.4%

2. Death and other daily compensation for illness, pregnancy etc: 8.6% (capped at MAD 6,000)

3. Professional training tax: 1.6% (uncapped)

4. Mandatory health insurance: 3.5% (uncapped)

For more details, please refer to the section on Employment.

+1 877 457 7691
Chat Now
  • Twitter
  • Linkedin

Subscribe

to our monthly Global Mobility newsletter