In brief: A liberal professional in Morocco (doctor, lawyer, architect, chartered accountant) can operate as a sole proprietor (IR, progressive scale up to 37%) or through a company (IS at 20% then IR on distribution). The optimal choice depends on the level of profit: below MAD 300,000, IR is often more advantageous; above that, an SARL under IS allows you to manage your remuneration and benefit from limited liability. A chartered accountant can help you structure your activity optimally.
Liberal professions and professional income (Art. 30 of the Tax Code)
Liberal professions exercised as a sole proprietor generate professional income within the meaning of Article 30 of the Tax Code. This income falls under the category of non-commercial profits (BNC) and is subject to income tax.
The following professions are notably concerned:
- Medical professions: doctors, dentists, pharmacists, physiotherapists
- Legal professions: lawyers, notaries, bailiffs, legal advisers
- Technical professions: architects, consulting engineers, surveyors, topographers
- Financial professions: chartered accountants, statutory auditors, management consultants
- Others: consultants, independent trainers, designers
The liberal professional has the choice between two fundamentally different legal frameworks to carry out their activity, each with distinct tax consequences.
Option 1: Sole proprietorship — IR
Tax regime
The professional operating as a sole proprietor is subject to IR under the progressive scale (Art. 73 of the Tax Code). The marginal tax rate (MTR) reaches 37% for the net taxable income bracket exceeding MAD 180,000 per year.
The net professional income is determined under the net real profit (RNR) regime or, for taxpayers whose turnover does not exceed certain thresholds, the simplified net profit (RNS).
For a detailed treatment of professional income tax, see our dedicated guide.
Deductible expenses under IR
The liberal professional may deduct from their receipts all expenses incurred for business purposes:
- Rent for the office or professional premises
- Depreciation of equipment and professional assets
- Personnel costs (secretary, assistant, associates)
- Social contributions (CNSS, health insurance)
- Fees paid to third parties (subcontracting, expertise)
- Vehicle expenses (professional proportion)
- Professional insurance
Advantages of individual IR
- Administrative simplicity: no company formation formalities
- Reduced management costs: lighter accounting obligations than a company
- Full freedom to manage cash flows
- Exemption from the minimum contribution for the first 36 months (for new taxpayers)
Disadvantages of individual IR
- High marginal rate: 37% from MAD 180,001 of net taxable income
- Unlimited liability: personal assets are at risk
- No distinction between remuneration and profit
- Limited optimisation: inability to modulate the pace of distributions
Option 2: Setting up a company — IS
Legal structure
The professional may operate through an SARL, SARLAU (single-member) or SAS. The company is then subject to corporate tax (IS).
Applicable IS rates (2026 progressive scale)
| Net taxable profit bracket (MAD) | IS rate |
|---|---|
| 0 – 300,000 | 10% |
| 300,001 – 1,000,000 | 20% |
| Over 1,000,000 | 35% |
Double taxation: IS + IR on distribution
The net profit after IS may be distributed as dividends, subject to a 10% withholding tax (Art. 73-II-B-7°). The professional therefore bears double taxation:
- IS on the company’s profit
- IR (10% withholding) on the dividends received
The professional may also pay themselves a manager’s salary, which is deductible from the company’s result and subject to salary income tax under the progressive scale.
Advantages of IS
- Moderate IS rate: 10% on the first MAD 300,000, 20% up to MAD 1,000,000
- Remuneration management: choice between manager’s salary and dividends
- Limited liability: personal assets are protected (SARL/SAS)
- Greater latitude in terms of deductible expenses
- Enhanced professional image with clients and partners
Disadvantages of IS
- Formation and management costs (articles of association, publication, accounting, possible statutory audit)
- Heavier accounting obligations (balance sheet, tax returns, IS and VAT filings)
- Double taxation on distributed profits
Numerical comparison: effective rate by profit level
The table below compares the overall effective tax rate for a single liberal professional with no dependants, depending on whether they operate under IR or IS (with full distribution of the post-IS profit as dividends).
| Net profit (MAD) | Individual IR | IS + 10% dividends | Difference |
|---|---|---|---|
| 100,000 | 14,000 (14%) | 10,000 (IS) + 9,000 (div.) = 19,000 (19%) | IR more advantageous |
| 300,000 | 85,800 (28.6%) | 30,000 (IS) + 27,000 (div.) = 57,000 (19%) | IS more advantageous |
| 500,000 | 161,800 (32.4%) | 70,000 (IS) + 38,700 (div.) = 108,700 (21.7%) | IS clearly more advantageous |
| 1,000,000 | 351,800 (35.2%) | 170,000 (IS) + 74,700 (div.) = 244,700 (24.5%) | IS very advantageous |
Assumptions: IR calculated under the progressive scale without additional deductions. IS calculated under the progressive scale. Dividends = net profit after IS, 10% withholding.
Tipping point: at around MAD 200,000 to 250,000 of net profit, IS begins to become more advantageous than IR from a purely tax perspective.
Optimisation through the manager’s salary
In practice, the professional in an SARL can combine manager’s salary and dividends to optimise their overall tax burden. The manager’s salary is:
- Deductible from the company’s result (reducing the IS base)
- Subject to salary IR (with 20% professional expenses deduction and social contributions deduction)
This combination allows taking advantage of the 0% bracket and the lower brackets of the salary IR scale, while limiting IS and the withholding tax on dividends.
Asset protection: a decisive criterion
Sole proprietorship: unlimited liability
A liberal professional operating as a sole proprietor commits the entirety of their personal assets in the event of professional debts, court judgments or tax reassessments. There is no separation between professional and personal assets.
Company (SARL/SAS): limited liability
By setting up an SARL or SAS, the professional limits their liability to the amount of their capital contributions. Their personal assets (residence, savings, personal property) are protected from the company’s creditors, except in cases of proven management fault.
This criterion is often decisive for high-risk professions (doctors, architects) or activities requiring significant investments.
Intermediate regimes
Single Professional Contribution (CPU)
The CPU is a simplified regime available to professionals whose annual turnover does not exceed MAD 200,000 (service activities). It replaces IR, the professional tax and the minimum contribution with a single quarterly payment. This regime may suit professionals starting out or with modest income.
Auto-entrepreneur
The auto-entrepreneur status allows carrying out a professional activity under a simplified tax and social regime. The tax is calculated on turnover (not profit) at a rate of 20% for services. This status is capped at MAD 200,000 in annual turnover for service activities.
This status suits secondary activities or professionals in the launch phase, but it is rarely optimal beyond a few years due to the absence of expense deductions.
Case study: doctor with MAD 800,000 profit
Dr Amina is a general practitioner in Casablanca. Her practice generates an annual net profit of MAD 800,000. She is deciding between maintaining her activity under IR or setting up an SARL.
Scenario 1: operating under IR
| Item | Amount (MAD) |
|---|---|
| Net taxable profit | 800,000 |
| IR (progressive scale) | (800,000 x 37%) − 27,400 = 268,600 |
| Effective rate | 34.4% |
Scenario 2: SARL under IS with salary/dividend optimisation
| Item | Amount (MAD) |
|---|---|
| Annual gross manager’s salary | 360,000 |
| Company profit after salary | 440,000 |
| IS (300,000 x 10% + 140,000 x 20%) | 30,000 + 28,000 = 58,000 |
| Net profit after IS | 382,000 |
| Dividend withholding (10% x 382,000) | 38,200 |
| Salary IR on 360,000 (after CNSS, AMO, professional expenses) | ≈ 42,800 |
| Total taxes and levies | 139,000 |
| Overall effective rate | 17.4% |
Annual saving: 275,200 − 139,000 = MAD 136,200, representing a saving of nearly 50% on the tax burden.
This scenario illustrates the major benefit of a corporate structure for high-income professionals. The optimisation relies on a balanced mix of manager’s salary and dividend distribution, calibrated with the help of a chartered accountant.
Frequently asked questions (FAQ)
From what level of profit is it better to switch to IS?
As a general rule, switching to IS becomes fiscally advantageous from an annual net profit of MAD 200,000 to 250,000. Below this threshold, the company’s management costs (accounting, legal obligations) may cancel out the tax saving. As each situation is unique, guidance from a chartered accountant is recommended for a personalised simulation.
Can a lawyer or doctor set up an SARL to practise?
Yes. Most regulated liberal professions can practise through an SARL, SARLAU or SAS in Morocco. Some professions impose additional conditions (professional body approval, exclusive corporate purpose). The chartered accountant assists the professional with the formation formalities and ensures tax compliance.
What are the social contributions for an SARL manager?
The associate manager of an SARL is registered with CNSS as an employee if they pay themselves a salary. Contributions include: CNSS employee share (4.48% capped at MAD 6,000/month), AMO (2.26%), and the employer shares borne by the company. The manager thus benefits from health insurance coverage and CNSS retirement.
Can I revert to IR after opting for IS?
Dissolving the company allows reverting to individual practice under IR, but this operation entails tax consequences: taxation of the liquidation bonus, registration duties, and deregistration formalities. It is preferable to carefully consider the choice of structure from the outset, with professional guidance.
READ ALSO:
- Professional income tax in Morocco
- Corporate tax in Morocco
- Auto-entrepreneur in Morocco
- Salary income tax in Morocco: 2026 scale
- Holding company in Morocco: complete tax guide
- Tax law advisory — Upsilon Consulting
This article is written by the chartered accountants team at Upsilon Consulting, a firm registered with the Order of Chartered Accountants (OEC) of Morocco.
Need help choosing between IR and IS? Contact Upsilon Consulting for a personalised simulation and tax advisory tailored to your profession.
