Repatriation of funds

moneyman

Is it true that if you don't invest your funds through a bank in morocco, then you cannot repatriate the funds during a resale? What are the rules for repatriaton of funds....?

If I buy a property today for £50k, and sell it for £100k in 5 years, how would the finances work...any ideas?

Thanks.

Prolan

Hi Moneyman,

From my research it seems that you got it right. All profits can be repatriated on the condition that investment can be traced back by the exchange commission. This can be achieved only by investing through funds deposited in a Moroccan bank account.

Hope this helps even if it probably confirms what you didn't want to hear.

Kind regards,
Prolan

moroccobound

All profit, less 20% capital gains tax on the 'offical' selling price can be repatriated if the Notaire files the appropriate papers with the foreign exchange authorities. It should be noted that not all money brought into Morocco can be repatriated.

camel

Moroccobound: Can you please give us an example as to what type of funds that you consider will not be allowed to be repatriated ????????????

Does that mean that I have to leave these funds for my six moroccan wives and two camels ????

Prolan

Hi moneyman,

I didn't notice the 5 year span in your post and moroccobound is correct in drawing your attention to tax matters. If you hang onto your property for more than 10 years ==> there is no capital gains (TPI tax) in Morocco.

If you hang onto it for more than 5 years: the capital gains tax is 10%. For any capital gain on property held less than 5 years the tax is 20%.

Inheritence tax for family members is 0% should you leave the property to one of your family members.

Tax on rental income: first three years excempt. After that you pay tax on 60% of the rental income at a rate of between 22% and 44% depending on exact location.

Please take these as guidelines only and consult a tax advisor to assess your personal circumstances.

To return to the topic of repatriating your funds: the general rule is to never part with cash...always leave a trace either via a cheque or a bank transfer. As long as your funds can be traced by the exchange commission there shouldn't be issues in repatriating the funds.

Hope this helps.

Prolan

Hi Camel,

Even worse....the money will probably go in the King's pocket...and he certainly doesn't need it. Kidding.

The money will still be yours to enjoy but only in Morocco.

So again I cannot say it enough...make sure your funds can be traced back (no cash) by the exchange commission (your notary will inform the commission when he takes some money from you). Please also be aware that not all sales go through notaries, some people buy and sell through Aduls ==> (registrars) and I don't know if those transactions are communicated to the exchange commission.

Anyway I would avoid any purchases unless it goes through the Notary.

Regards,
Prolan

camel

Prolon: You are not far wrong where the money will go. Yes he does not need it. But greed has no boundries.

What on earth are you suppose to enjoy that kind of money, once converted into Dirhams ????????????? Any sugguestions. Its for that reason that I was offering an honourable solution of taking up wives and keep the animal loving feternity happy as well.

octanorm

You must open an bankaccount in Morocco in dirhams converibel . In this way all the transfer of money past to the office of change in Casablanca. When you buy a property , the notaire inform the office of change . When you sell you property , the notaire hold the money untill you can prouve that you pay the 20% taxe between the buy price and the sell price. After this you transfer all the money to Europe. The 20% taxe on the profit is a maximum , if you prooof that you don't have profit anyway you will pay a minimum of 3% because the administration knows that you don't give the right figures.

Shawaz

This thread has got me very concerned... I am seriously considering buying in the country at the moment but am yet to decide on location and type of property I will purchase. I was under the impression that I could just pay for part of my property from the UK and the rest from Morocco once I’d opened a bank account. If in the future, I sold my property, I was hoping to pay the relevant tax due and then repatriate any profits either back to the UK or put them into another investment back into Morocco or another country.

I have since spoken to a Moroccan solicitor this morning and have been informed that the only way to guarantee the repatriation of funds is to purchase the property through a bank account in Morocco, which will show a trace of all the transfers. Somehow, I’m not too convinced with this answer as I have also read in a few places that the government allows 100% repatriation of funds to UK buyers. I’m about to make some further enquires, especially with the Moroccan Embassy and will post my findings on the forum sometime soon.

moneyman

Prolan,

This is quite concerning like Shawaz said....let me get this straight again. There are two ways you can buy property:

a) Off-plan through the developer
b) Resales

The first route is straightforward and I presume you would open an account in morocco anyway before commencing any transactions (barring any reservation fees...)

The second route is my concern. There are a number of investors in the UK who have already bought off-plan and are putting their properties on the resale market. If I was to purchase one of these properties, I will be transferring money to the UK as a start because these investors have already paid their deposit, so they will be looking to get that money back at least.

May be following on, I will be put on a developer payment structure and then I will start paying direct to the developer. So you see, in this situation, there is no choice but to split the payment - part in UK and part in Morocco.

What does one do in such a situation?