Advantages of Becoming an Auto-Entrepreneur
An auto-entrepreneur is a legal designation of an independent business in Morocco. It is a sole proprietorship, it is an independent worker, one person, you cannot have employees and you cannot have multiple people working under the same status.
Being auto entrepreneur gives you a tax status meaning you can report your revenue, expenses and your net income through the auto entrepreneur system and it's
relatively easy. You do it once a quarter but it keeps you legal which if anyone
is going to grow a significant business in Morocco, that is going to pay for your lifestyle, a home, a car, you need to have a legal status because at some point you're going to grow big enough that the authorities will become aware of you and then they'll shut you down or they'll hit you with a huge tax bill and they'll take all your money, this happens all the time.
The tax on manufacturing, sales, and artisan work is 1% on net income and for services like consulting, hair stylist, private tutor, musician, etc there is a 2% tax on net income.
Unemployment is a huge problem in Morocco but if you can manufacture or if you can find manufacturers and be an intermediary for them and you can get your hands on good merchandise at a reasonable price and a reliable quality and deliver it in a timely manner, you can find people to buy it, especially when it comes to handcrafted items that are made in Morocco. Ceramics, leather goods, carpets, and other kinds of things that are manufactured in Morocco are in demand by customers around the world.
Consistency is a huge problem in Morocco and thus if you can figure out a way to have reliable products that are made to spec and have a consistently high standard of quality, then you can make money, you can find people who will buy your stuff and then they will resell it in Morocco or internationally. The manufacture, distribution, and sale of merchandise in Morocco is an approved activity under the auto-entrepreneur statutes.
The other advantage the auto-entrepreneur status gives you is the ability to invoice, meaning if you do work for a company that wants to expense your work and deduct it from their revenue to pay less taxes, you have the ability to do that legally. It's relatively easy to sign up. You print out a few forms online, you fill them out and you submit them to one of hundreds of locations across Morocco. Almost every bank branch in the major cities will accept them or you can just go to the post office and submit the papers and I've heard that you get your card back in anywhere from two to six weeks.
There are various types of activities that you can do as an auto-entrepreneur, but you can't do everything, it's a specific status, it's not for companies that are dealing
in licensed work, for example a medical doctor, a lawyer,or an accountant, things
that require permits and licensing and certifications, they're not authorized under the auto-entrepreneur statutes.
www.ae.gov.ma has a complete list of authorized activities but here are a few examples:
you can sell almost anything (you can't sell airplanes and helicopters and buildings and houses, those are a protected class of sales) but almost any food item, almost any finished good, furniture, clothing, electronics, crafts, housewares, you can sell these types of items and you can also manufacture them, so as an auto entrepreneur if you're selling items then you can sell up to 500.000 Dirhams per year as an auto-entrepreneur. There is a 200.000 Dirham limit for the performance of services. Once you surpass these levels you have to convert your auto-entrepreneur status in to a formal business.
Some other things you can do are private security, artist, designer, disc jockey, a tourist
guide, or a photographer. Additionally as an auto-entrepreneur, you can be a taxi driver, a language tutor, a construction worker doing things like painting, carpentry, landscaping, welding, etc.
Whether you have a full time job and just want to make extra money or you are a student or are currently unemployed, the auto-entrepreneur program is a great opportunity to earn money, test business ideas, and get traction in your career.
This article is taken from the Business in Morocco Podcast, Episode 31