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Panama: tax, residence and citizenship

Panama merits close attention for its territorial income-tax framework and investment residence options. The September 2026 rules distinguish new property from resale property and introduce a state-bank deposit alternative. Source-of-income analysis remains essential, particularly for people continuing to work or manage a business locally.

Sources last checked · Research methodology

Tax relocation in Panama

Panama’s territorial principle focuses income taxation on income produced within Panama. That is not the same as exempting every payment from a foreign customer or bank account. The Fiscal Code provisions cited by the tax authority treat professional services performed within Panama as potentially Panamanian-source income. A UK consultant or director moving there therefore needs a functional analysis of where services and management occur. UK-source income and UK temporary-non-residence rules also remain relevant. The correct comparison is between documented income categories and activities, not simply the country of the payer.

Residence rights

Executive Decree 17 of 8 September 2026, effective on publication on 16 September, replaces the earlier Qualified Investor rules. The Ministry of Commerce confirms B/.300,000 for new first-sale property and B/.500,000 for resale property. It also identifies B/.500,000 deposits with Banco Nacional de Panamá or Caja de Ahorros. The decree’s securities route requires B/.500,000 of eligible investments and a five-year commitment. Other modalities and family charges must be checked against the current decree before funding. This is a permanent-residence route; any later naturalisation is separate and conditional.

Second citizenship

Residence is separate from citizenship. Any naturalisation, family or descent route requires its own eligibility review.

What to establish first

  • New first-sale property: B/.300,000; resale property: B/.500,000.
  • State-bank fixed deposits: B/.500,000 with the named eligible banks.
  • Qualifying securities route: B/.500,000 and a five-year commitment under Article 8.
  • Confirm the property classification, source of funds and applicable maintenance obligations.

Consider the trade-offs

  • Older guides often cite rules or deadlines superseded by the September 2026 decree.
  • Services physically delivered in Panama can be local-source even when paid from abroad.
  • Immigration approval does not settle tax residence or naturalisation eligibility.
These are research findings, not an individual eligibility or tax determination. Confirm current rules and your circumstances before committing funds or moving.

Official sources and further reading

MICI announcement of the Qualified Investor changes on 21 September 2026 Executive Decree 17 of 8 September 2026 Official legal database confirming commencement on 16 September 2026 DGI publication of Law 6 of 2005 and Fiscal Code article 694

The research-check date is different from the publication or effective date of an individual rule. How this research is prepared.