An announcement made by the 'Direction Générale des Impôts' (DGI) on March 27th has extended the deadline to fulfill some corporate income tax obligations.
Said obligations are the filing of 2019 corporate income tax return, payment of the balance of this tax pending payment for 2019 and of the first tax prepayment for 2020. Under normal circumstances, these obligations had to be fulfilled on March 31st at the latest. Payment of these amounts may also be made in instalments agreed between the taxpayer and the DGI.
Extension of the delay is granted under the following conditions:
Companies whose 2018 turnover did not exceed twenty million dirhams (approximately 1.8 million euros): automatically.
Companies whose 2018 turnover exceeded twenty million dirhams: subject to the filing by the tax payer before March 31st of a request evidencing the financial difficulties it is going through due to the current health emergency.
In case (ii) the measure raises some uncertainties regarding the time frame in which the DGI will respond to the requests filed and whether these will be accepted or rejected. If the requests are rejected after March 31st, the taxpayer will be subject to the following penalties and late payment interest:
A penalty ranging from 5% to 15% of the whole corporate income tax due for 2019 because of the late filing of the return. The 5% penalty applies if the return is filed less than thirty days late and the 15% if the delay exceeds thirty days.
A 10% penalty on the balance of corporate income tax pending payment for 2019 and on the first tax prepayment for 2020.
Late payment interest of 5% for the first month of delay and 0.5% for each month subsequent to the first, to be applied on the amounts mentioned in (ii) above.