Panama
A territorial tax system, USD-based economy, and the Friendly Nations Visa make Panama one of the most accessible and tax-efficient residency destinations for entrepreneurs and retirees worldwide.
4.4M
Population
Panama City
Capital
Spanish / English
Language
USD (Balboa)
Currency
GMT-5
Timezone
0%
Foreign Income Tax
USD 5,000
Min Bank Deposit
3-6 months
Visa Processing
Visa Types
Panama offers several residency pathways, from the popular Friendly Nations Visa to one of the world’s best retiree programs with the Pensionado Visa.
Friendly Nations Visa
From USD 5,000 bank deposit
Processing: 3-6 months
- Available to citizens of 50+ friendly nations
- Requires economic or professional tie to Panama
- Includes work permit
- Path to permanent residency and citizenship after 5 years
Pensionado Visa
USD 1,000/mo pension income
Processing: 3-6 months
- For retirees with a lifetime pension of at least USD 1,000/mo
- Significant discounts on utilities, travel, dining, and healthcare
- No age requirement
- One of the best retiree visa programs in the world
Self-Economic Solvency Visa
USD 300,000+ in Panama assets
Processing: 3-6 months
- For individuals with significant assets in Panama
- Real estate, fixed-term deposit, or business ownership qualifies
- Includes dependents
- Fast track to permanent residency
The Tax Reality
Panama’s territorial tax system means foreign-sourced income is completely exempt. Here’s what you need to know.
Panama uses a territorial tax system — only income sourced within Panama is taxed. Foreign-sourced income is completely exempt.
There is no capital gains tax on foreign transactions or overseas income.
Corporate tax applies only to Panama-sourced income at rates from 0% to 25%.
Panama has no controlled foreign corporation (CFC) rules, making it attractive for international business structuring.
The country has signed very few tax information exchange agreements, offering a high degree of financial privacy.
A territorial system means your global portfolio, foreign rental income, and offshore business profits are not taxed in Panama.
Ready to set up in Panama?
We coordinate with vetted local professionals in Panama to handle visa applications, company formation, bank account opening, and foundation setup.
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