Self-employed, employee, or company

How can you earn income from your work in Morocco, the key to obtaining a residence permit? There are three possible statuses:

• employee
• entrepreneur, with your own company
• self-employed

Each of these statuses has its advantages and disadvantages, as well as specific constraints for foreign residents in Morocco.

Being an employee in Morocco

For a foreigner, being employed in Morocco requires a Foreign Employment Contract, or CTE, which must be validated by the Ministry of Labor via the Taechir platform.

There is no work visa in Morocco that allows you to work without this CTE. Even with a ten-year residence permit, the CTE must be requested for each new contract.

The advantages of employee status:

• With the exception the CTE, no administrative complexity
• Social security (and possibly, depending on the company, supplementary insurance and supplementary pension plans)
• The possibility for foreigners to benefit from the wage savings mechanism (and therefore transfer all or part of their salary to a convertible dirham account)

The disadvantages of employee status:

• the requirement for a CTE and therefore an Anapec certificate, which can be difficult to obtain for jobs that do not require specific qualifications
• high taxes once you exceed the average salary
• low social security coverage
• relatively low salaries for local contracts compared to expat contracts

Having a company in Morocco

Setting up a company in Morocco remains easy and inexpensive. With the exception of a few regulated activities (mainly liberal professions), there are no specific restrictions for foreigners, and no requirement for a majority Moroccan shareholding, except for agricultural land operations.

And, of course, the company manager can pay themselves a salary without having to go through the Anapec procedure or sign a foreign employment contract.

However, a company does involve administrative costs:

• registered office (whether a registered address or rented premises)
• accountant
• income tax, business tax after five years
• business bank account

In addition, you need to have a basic knowledge of the legal and tax environment. An accountant cannot do everything. If you have employees, you also need to be aware of the basics of Moroccan labor law.

Finally, being an entrepreneur requires additional qualities: in addition to your expertise, you also need to know how to prospect for business, find customers, and be able to deal with late payments, etc.

The advantages of having a company in Morocco

• You can begin the formalities before becoming a resident.
• This is the safest way to obtain a residence permit if you do not have any special qualifications or exemptions from the ANAPEC certificate.
• You can optimize part of your income in the form of dividends instead of salary.

The disadvantages of a society

• higher annual administrative costs
• tax and social security risks if you have no administrative expertise
• closure costs equivalent to those of setting up the business
• no potential savings on salaries

Being an autoentrepreneur in Morocco

Autoentrepreneur status is the simplest in administrative terms.

However, it is reserved for people who are legally resident in Morocco, i.e. Moroccans and foreigners with a residence permit. Although some people have managed to renew their residence permit with existing autoentrepreneur status, the official website clearly states that this is not possible.

For the provision of services, the annual turnover is limited to 200,000 dirhams (or 16,667 dirhams per month). While this may seem like a significant amount at first glance, it should be remembered that no expenses are deductible.

In addition, the turnover per customer must not exceed 80,000 dirhams. Above this amount, the client must make a 30% withholding tax. If you bill them 100,000 dirhams, you will be paid 94,000 dirhams. If you bill them 200,000 dirhams, you will be paid 164,000 dirhams.

Finally, import-export operations are not permitted for autoentrepreneurs. Although in practice, invoicing foreign customers has not been subject to control or adjustment, autoentrepreneurs cannot keep 70% of their foreign currency earnings in a convertible dirham account.

One last point concerning foreigners: most of them have enormous difficulty activating their CNSS rights.

The advantages of autoentrepreneur status

• administrative simplicity

The disadvantages of autoentrepreneur status

• It does not allow you to obtain or renew a residence permit.
• It is limited to 200,000 dirhams per year and 80,000 dirhams per year per client.
• In theory, it does not allow you to export goods.

In conclusion, the best status depends on your situation.

Moroccan citizens who do not require a residence permit and have a medium-sized business will undoubtedly find that self-employment is the best status for freelancers.

Whether you are Moroccan or a foreign national, if you can obtain an employment contract, salaried employment is a safe option, but it will not allow you to make a fortune.

For foreign nationals, setting up a company remains the best option for working and living in Morocco.

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