Transferring a property in Morocco: lifetime donation or inheritance, what are the tax rules?

1. Two transfer routes, two legal logics

In Morocco, transferring a property to a relative mainly takes two paths. The Hiba donation (هبة) is a deed between living parties: the donor transfers ownership of a property gratuitously and, in principle, irrevocably to a donee who accepts it. It takes effect immediately. Conversely, inheritance operates on death: the property is devolved to the heirs according to the rules of the Moudawana (Family Code), then declared and registered.

The full framework of donation is detailed in our guide on the Hiba donation, and that of devolution in our guide to property inheritance. The purpose of this article is different: to compare the two routes from a tax angle, including the tier that most families overlook.

2. First tier: the immediate cost of transfer

This is the most visible tier, and the one that often tips the scales towards the Hiba. A donation between spouses, ascendants and descendants in the direct line, and siblings is exempt from TPI (article 63-III of the CGI) and bears registration duties of 1.5% (article 133-I-C-4°), to be confirmed with your notary or tax adviser at the time of the deed. Inheritance gives rise to no TPI either: real estate profit is taxed only on a later sale for consideration.

• On the Hiba donation side: registration duties of 1.5% in the direct line, between spouses and between siblings, calculated on the value of the gifted property; to this are added ANCFCC fees for the title transfer, adoul/notary fees and a possible local tax. Outside these family links, different rules apply: have them confirmed before the deed.
• On the inheritance side: devolution follows the Moudawana; the property is declared and registered at its market value on the date of death, with the associated costs (ANCFCC, formalities, fees).

For the detail of the rate schedules and the various scenarios, see our article on registration duties case by case. But stopping at this first tier is reading only half the bill.

3. Second tier — the one that gets forgotten: the acquisition price for future TPI

Here is the heart of the comparison. One day, the donee or heir may want to resell the property. They will then owe the Tax on Real Estate Profits (TPI), whose standard rate is 20% of the net taxable profit, and which cannot be lower than a minimum contribution of 3% of the sale price. And the net profit is calculated as follows: sale price, less selling costs, less acquisition price and costs revalued by the indexation coefficient.

The whole issue lies in this "acquisition price". For a property received by inheritance, the General Tax Code takes as the acquisition price the market value on the date of death (article 65-II): either the value entered on the inventory drawn up by the heirs or, failing that, the value declared by the taxpayer, ignoring any later partition deed. For a property received by donation exempt under article 63-III, the code refers instead to the price of the last sale for consideration (plus investment expenditure), to the market value at the last inheritance if it is more recent, or to the cost price. In other words, for an inherited property the value set at death follows the property and resurfaces, years later, in the calculation of the heir's TPI.

4. The role of the indexation coefficient

Good news for the beneficiary: the indexation coefficient provided for by the General Tax Code, published annually by the DGI, revalues the acquisition price between the acquisition date (for an inheritance, the date of death) and the resale date. Mechanically, it reduces the net profit, and therefore the TPI due.

The consequence: the longer the interval between transfer and resale, the more the coefficient revalues the starting base — and the more moderate the TPI will be. The detail of the mechanism and its quantified impact are explained in our dedicated article on the TPI indexation coefficient. But this coefficient only revalues a starting base: if that base was understated, no coefficient will make up the shortfall.

5. Hiba donation: what it enables beyond tax

The choice never comes down to pure taxation. The Hiba offers structural advantages that inheritance does not:

• Transfer during your lifetime, without ambiguity: the property leaves the future estate, which can prevent conflicts between heirs.
• Retain use through dismemberment: with a reserved usufruct, the donor transfers the bare ownership but keeps the use and income of the property for life. On the donor's death, the usufruct extinguishes and the donee becomes full owner.
• Framing clauses: right of reversion, temporary inalienability, care obligations — tools to modulate the effects of the donation without distorting it.

The Moudawana safeguard: with regard to the forced heirship reserve, an excessive Hiba in favour of a single heir can be reduced after the fact if it encroaches on another heir's reserved share. Hence the value of a comprehensive estate-planning simulation before signing.

6. The choice of deed — adoul or notary — and the MRE case

The Hiba is traditionally recorded by an adoular deed; it can be notarised, which is recommended for registered properties and for international enforceability. For an MRE donee, the bilingual notarial deed facilitates enforceability in the country of residence, where the beneficiary may have their own reporting obligations — hence the need to coordinate with a local tax adviser.

In every case, whether a donation or an inheritance, the deed is built on a value. The notary or adoul formalises it; they have neither the role nor the vocation to establish the market value of the property. It is precisely this point that determines the tax robustness of the transfer.

7. Summary comparison — how to decide

• If the goal is to transfer now, keep the use and avoid conflicts: the Hiba, possibly with a reserved usufruct, is often the most flexible route — subject to respecting the forced heirship reserve.
• If the beneficiary will probably resell one day: the decisive criterion is not the immediate cost, but the acquisition price the code will retain for TPI, which for an inheritance is the market value on the date of death. Documenting it early avoids having to reconstruct it years later.
• If several heirs are involved: objectifying the value through an independent report defuses disputes, whether you choose a targeted donation or inheritance devolution.
• In every case: no decision is purely tax-driven. Coordinate the notary/adoul, the tax adviser and the expert before finalising the deed.

8. The piece that secures both scenarios: the valuation at the transfer date

Whether you lean towards donation or inheritance, one common denominator stands out: the market value of the property at the transfer date. It is the base for the Hiba's registration duties or for the inheritance declaration, and, for an inherited property, it is also the acquisition price for the heir's future TPI. A documented valuation gives a verifiable base for both uses.

Our RICS-certified experts establish this value through a report compliant with RICS standards — condition of the property observed, areas verified, comparables documented and, where relevant, the economic calculation of the dismemberment (usufruct/bare ownership). This report is delivered as a technical document to the adoul or notary before the deed is drawn up. Cost: from MAD 3,500 excl. tax, report in 5 to 8 days (48-72 h express), firm quote within 24 h.

9. FAQ

Note: This article is methodological in purpose and does not constitute individualised tax advice. Registration-duty rates, exemption conditions and TPI calculation rules fall under the General Tax Code and the regulations in force: confirm your situation with your notary or a tax adviser. The forced heirship reserve falls under the Moudawana. To document the value of your property at the transfer date, get it valued through our independent RICS appraisal service or browse more analyses on the ReaConsult blog.