Whether you're retiring, working remotely, or simply craving a change of scenery, Panama offers an appealing blend of modern infrastructure, stunning natural beauty, and a welcoming expat community.
In this guide, we’ll walk you through everything you need to know about relocating to Panama from a personal tax perspective, including tax residency, income tax, special tax regimes and tax return obligations.
TaxPilot recommend that you organize your affairs in good time to get ahead and make the most of favorable tax treatment while making sure you’re meeting your tax return obligations.
Panama follows a territorial taxation model. You will pay tax on local sourced incomes only, irrespective of your resident status.
if you are present in Panama on more than 183 days during the tax year.
Providing that you hold the digital nomad visa, income generated from your status as a digital nomad (employment income and self-employment income) will not be taxable in Panama. Panama can be a very tax efficient place to live in and as such, Global Tax Consulting recommends seeking personalized tax planning advice to take advantage of the special tax regime.
Exempt from Panama taxation.
Must hold the digital nomad visa.
Tax on property and share sales
Tax on value of owned assets
Tax on assets passed to heirs
Tax to contribute to state welfare
If you receive incomes overseas while you are living in the Panama, you may find that the source country, as a starting point, continues to tax the income.
Double taxation agreements may remove the source country’s taxing right and thus, enable you to receive incomes tax free globally.
At present, Panama has 17 double taxation agreements signed.
