In brief — Is your transaction subject to VAT in Morocco, exempt, or outside the scope? This article provides a 5-step decision tree to qualify any transaction for VAT purposes: nature, scope, voluntary registration, exemptions, and rates. Six practical cases illustrate the methodology. For instant qualification, use our interactive tool or download the Morocco VAT 2026 PDF guide. For a comprehensive overview, see our complete Morocco VAT guide.
VAT Decision Tree in 5 Steps
Qualifying a transaction under Moroccan VAT law means sequentially answering five questions. Each answer leads either to the next step or to a definitive conclusion.
Step 1 — Nature of the Transaction
The first question concerns the intrinsic nature of the transaction. Does the activity fall within the industrial, commercial, artisanal, service provision, or liberal profession domains? If yes, proceed to step 2. If the transaction is purely agricultural, constitutes a civil act, or has no commercial character, it falls outside the scope of VAT. The analysis stops here, unless the operator wishes to explore the voluntary registration option (step 3).
Step 2 — Scope of Application (Art. 89 GTC)
Article 89 of the General Tax Code exhaustively lists transactions that are compulsorily subject to VAT. Does the transaction appear on this list? If yes, proceed directly to step 4 to check for possible exemptions. If no, the transaction is not compulsorily taxable, but the operator may optionally register for VAT — proceed to step 3.
Step 3 — Voluntary Registration (Art. 90 GTC)
Article 90 allows certain operators outside the scope or exempt from VAT to voluntarily opt for VAT registration. Has the operator exercised this option? If yes, the operator enters the VAT scope — proceed to step 4. If no, the transaction remains outside the scope and no VAT applies. For more on this mechanism, see our detailed article on VAT voluntary registration Art. 90.
Step 4 — Exemptions
The transaction is now within the VAT scope. Does it benefit from an exemption? Three regimes coexist:
- Art. 91 — Exemptions without right to deduct (WRD): the transaction is exempt but input VAT is not recoverable. See WRD exemptions Art. 91.
- Art. 92 — Exemptions with right to deduct (RD): the transaction is exempt and input VAT remains recoverable. See RD exemptions Art. 92.
- Art. 94 — Suspensive regime: VAT is suspended under specific conditions. See VAT suspensive regime.
If no exemption applies, proceed to step 5.
Step 5 — Rate Determination
The transaction is taxable. Which rate applies? In 2026, the standard rate is 20% and applies to most transactions, including liberal professions (notaries, lawyers, chartered accountants, architects, etc.). The reduced rate of 10% applies to certain transactions listed in Art. 99-B of the GTC (catering, tourist accommodation, banking operations, transport, certain food and energy products). See full details in our article on the VAT reform 2024-2026.
Practical Case 1 — Export of Services
Situation: A consulting firm based in Casablanca invoices a strategic advisory engagement to a client located in France.
Analysis using the decision tree:
- Step 1: Service provision of a commercial nature — within the potential scope.
- Step 2: Service provision Art. 89 — compulsorily taxable transaction.
- Step 4: Export of services — exemption with right to deduct under Art. 92.
- Conclusion: No VAT invoiced to the French client. Input VAT on Moroccan expenses is fully recoverable.
For details, see VAT on export of services Morocco.
Practical Case 2 — Furnished Rental by an Individual
Situation: An individual rents out a furnished apartment in Casablanca through an online platform.
Analysis:
- Step 1: Service provision — commercial character.
- Step 2: Accommodation transaction Art. 89-I-10 — compulsorily taxable.
- Step 4: No exemption applicable.
- Step 5: Standard rate of 20%.
- Conclusion: The owner must charge VAT at 20%, register for VAT, and file periodic returns.
More details: Real estate rental and VAT regime.
Practical Case 3 — Farmer Selling Crops
Situation: A farmer sells his citrus production to a wholesaler.
Analysis:
- Step 1: Agricultural activity — outside the scope under Art. 87 of the GTC.
- Step 3: The farmer may nonetheless opt for voluntary VAT registration (Art. 90) if it serves an economic interest, for instance if input suppliers are VAT-registered and the farmer wishes to recover VAT on purchases.
- Conclusion: Without opting in, no VAT applies. With the option, VAT becomes applicable and the right to deduct is opened.
Full details: VAT and agriculture Morocco.
Practical Case 4 — Real Estate Developer and Social Housing
Situation: A property developer sells a social housing unit at a price of 280,000 MAD including tax.
Analysis:
- Step 1: Real estate development — commercial character.
- Step 2: Sale transaction Art. 89-I-10 — compulsorily taxable.
- Step 4: Exemption with right to deduct Art. 92-I-28 applicable since the price does not exceed 300,000 MAD and the surface area meets the requirements.
- Conclusion: No VAT invoiced to the buyer. Input VAT incurred by the developer on construction works is fully recoverable.
See VAT for real estate developers and land developers.
Practical Case 5 — Self-Employed Hairdresser
Situation: A hairdresser under the auto-entrepreneur status generates annual turnover of 200,000 MAD.
Analysis:
- Step 1: Service provision — commercial character.
- Step 2: Normally within the scope of Art. 89.
- However, the auto-entrepreneur status places the operator outside the scope of VAT as long as turnover remains below the legal thresholds of 500,000 MAD for commercial/industrial/artisanal activities or 200,000 MAD for services.
- Conclusion: No VAT to charge or declare. The auto-entrepreneur cannot recover input VAT on purchases.
Learn more: VAT and auto-entrepreneur Morocco.
Practical Case 6 — Foreign SaaS Provider Billing a Moroccan Company
Situation: A US-based company provides a SaaS subscription (cloud software) to a Moroccan LLC (SARL).
Analysis:
- Step 1: Digital service — commercial character.
- Step 2: Service consumed in Morocco — territoriality under Art. 88 of the GTC.
- The supplier being a non-resident, the reverse charge mechanism under Art. 115 applies: the Moroccan client calculates, declares, and pays the VAT.
- Step 5: Standard rate of 20%.
- Conclusion: The Moroccan LLC must reverse-charge VAT at 20% on the amount of the foreign invoice. If the company has full right to deduct, the reverse-charged VAT is simultaneously deductible.
See VAT reverse charge Morocco and VAT on digital services Morocco.
Legal References
- General Tax Code (GTC) — Articles 87 to 125, Title III
- Circular Note 717 — Commentary on VAT provisions
- Morocco VAT 2026 Practical Guide — Download the PDF
Interactive Tool
Use our online VAT qualification tool to walk through the decision tree interactively and obtain a personalised result in under 2 minutes.
FAQ
How do I know if a transaction falls within Morocco’s VAT scope?
Start by consulting Article 89 of the GTC, which lists compulsorily taxable transactions (sales, service provisions, imports, construction works, etc.). If the transaction is not listed, check whether the operator has exercised the voluntary registration option under Article 90. Without inclusion in Art. 89 and without an Art. 90 option, the transaction is outside the scope.
How many VAT rates exist in Morocco in 2026?
Following the progressive reform of 2024-2026, Morocco is converging toward two main rates: the standard rate of 20% and a reduced rate of 10%. Some intermediate rates (14%, 7%) still apply to specific products during the transitional period.
Does an auto-entrepreneur have to charge VAT?
No, as long as annual turnover remains below the thresholds set by Art. 42-Ter A of the GTC (500,000 MAD for commercial, industrial and artisanal activities, 200,000 MAD for services). The auto-entrepreneur falls outside the VAT scope. In return, input VAT on purchases cannot be deducted.
