What Is the TPI and Who Is Affected?
The Taxe sur les Profits Immobiliers (TPI), or Real Estate Capital Gains Tax, is a Moroccan tax levied on capital gains realized upon the transfer of real estate or real property rights. It is governed by the Moroccan General Tax Code, particularly Articles 62 to 65. Any individual, whether resident or non-resident, who sells real estate in Morocco and realizes a profit is in principle subject to this tax. Transfers of shares in property-predominant companies are also covered. However, legal entities subject to corporate income tax are not subject to the TPI but rather to corporate tax on their real estate capital gains.
The taxable event for the TPI is the transfer of the property, meaning the date the notarial deed is signed before a notary or adoul. The seller is the legal taxpayer, even though in practice some buyers agree to bear part of the cost as part of an overall price negotiation. The declaration and payment must be made within 30 days of the transfer date to the tax inspector in the district where the property is located. Failure to meet this deadline results in late surcharges of 10% for the first month and 5% for each additional month thereafter.
Calculating the Taxable Base and Applicable Rates
The taxable property profit is calculated by deducting the property's cost price from the sale price. The cost price includes the original acquisition price, acquisition costs such as notary fees, registration duties and VAT where applicable, duly documented expenditure on construction, extension or improvement works, and interest on loans actually paid. To correct for monetary erosion, each of these cost price components is updated by applying a revaluation coefficient published annually by the General Directorate of Taxes based on the year of acquisition. For 2026, these coefficients are available on the Moroccan tax portal.
The TPI rate is 20% of net taxable profit, with a minimum collection threshold of 3% of the sale price. This minimum ensures that even if the profit is low or nil, a floor tax is still due. For example, if you sell a property for 1,500,000 MAD and your adjusted profit is 50,000 MAD, the theoretical TPI would be 10,000 MAD (20% x 50,000), but the minimum collection threshold would be 45,000 MAD (3% x 1,500,000). In this case, the minimum threshold applies. It is therefore essential to simulate both calculations before any sale to anticipate the actual tax burden.
Key Exemptions and Allowances to Know
The law provides several important exemptions. The main one is the total exemption from TPI on the profit realized from the sale of the taxpayer's primary residence, provided the property was used as the principal residence for at least 6 continuous years by the seller, their spouse, or their dependent children. A tolerance exists for periods shorter than 6 years in cases of duly justified exceptional circumstances such as professional transfer, death of a spouse, or divorce. This exemption is one of the most powerful tax optimization tools in Moroccan real estate.
Other exemptions worth knowing include the exemption for transfers where the profit is less than 30,000 MAD per year across all properties, the exemption for transfers by inheritance, and the special regimes applicable to transfers made within certain free zones or government programs. In addition, an allowance of 25% applies to the profit when the property has been held for between 6 and 10 years, and 50% after more than 10 years of ownership. These holding period allowances make a long-term holding strategy particularly advantageous from a tax perspective for real estate investors in Agadir and across Morocco.
