🇵🇦 Panama Tax Guide - Income Tax, Corporate Tax & Special Regimes

Top income tax 25.0% Territorial system

Corporate tax 25.0%

ITBMS 7.0% standard rate

Tax residency 183 days 18 tax treaties

Panama tax profile

Data year: 2025

Tax system: Territorial Panama taxes only Panamanian-source income. Foreign-source income is exempt regardless of whether remitted to Panama.
Top PIT rate: 25.0%
Corporate tax rate: 25.0%
ITBMS: 7.0%
Capital gains tax: 10.0% Real estate capital gains 10% on gain or 3% on total sale value (whichever is elected). Securities gains 10%.
Social security (employee): 9.8%
Social security (employer): 13.3%
Dividend withholding: 10.0%
Interest withholding: 12.5%
Royalty withholding: 12.5%
Treaty count: 18

Corporate

Corporate brackets
Bracket min	Bracket max	Rate	USD equivalent
USD 0	and above	25.0%	--

Personal income

Personal income brackets
Bracket min	Bracket max	Rate	USD equivalent
USD 0	USD 11,000	0.0%	--
USD 11,000	USD 50,000	15.0%	--
USD 50,000	and above	25.0%	--

Special regimes
Name	Type	Rate/amount	Duration	Status
Sede de Empresas Multinacionales (SEM) Multinational headquarters regime allowing companies to establish regional headq...	Exemption	--	--	Active
Free Trade Zones (Zona Libre de Colón) The Colón Free Trade Zone is the largest free trade zone in the Western Hemisphe...	Free zone	--	--	Active

Territorial Exemption

Days threshold: 183 days
Residency rules: Resident if in Panama for 183+ days in a fiscal year, or if center of economic/vital interests is in Panama.
Exit tax: No
CFC rules: No