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Panama for digital nomads: the remote worker visa, taxes and where to live

Panama for digital nomads: the remote worker visa, taxes and where to live

In short: Panama has a specific visa for remote work: the Short-Stay Visa for Remote Workers, created by Executive Decree 198 of 2021. It allows anyone working for a foreign company or foreign clients with income of at least 36,000 dollars a year to live in the country for nine months, extendable by another nine. Income generated outside Panama pays no income tax. The dollar, connectivity and a time zone aligned with the United States explain why the country attracts this profile.

The remote worker visa

Aspect Condition
Duration 9 months, extendable once for another 9 (18 in total)
Minimum income 36,000 dollars a year (3,000 a month) from foreign sources
Who qualifies Employees of foreign companies working remotely and independent professionals with clients outside Panama
Restriction No work for Panamanian companies or clients
Health insurance Mandatory, with coverage in Panama for the whole stay
Government fees 250 dollars for the application and 50 for the card
Dependants Not included; each family member applies separately
Procedure Before the National Immigration Service, through a lawyer, two to four months

Documents required

  1. Passport with at least six months’ validity and three photos.
  2. Notarised power of attorney to a Panamanian lawyer.
  3. Criminal record certificate from the home country, apostilled.
  4. Health certificate issued in Panama.
  5. Proof of income: a letter from the foreign company with position, salary and remote modality, or registration of one’s own company abroad and a sworn statement of clients.
  6. Valid health insurance policy.
  7. Sworn statement of not working for Panamanian companies.
Key fact: a digital nomad living in Panama pays no income tax on what they earn from foreign companies or clients, because Panama taxes only Panamanian-source income. They may still have tax obligations in their home country.

Why Panama

  • The dollar: no exchange risk or conversion fees for anyone paid in dollars.
  • Time zone: the same as the US East Coast in standard time, convenient for North American and European teams.
  • Connectivity: Panama City is the landing point of seven submarine cables and has fibre in the main residential areas.
  • Tocumen: the airport with the most connections in Central America.

Where digital nomads live

Area Profile
El Cangrejo and Bella Vista Central, walkable, with cafés and coworking; the most chosen for short stays.
San Francisco and Coco del Mar Residential, with parks and restaurants, near the Cinta Costera.
Casco Antiguo Historic heritage, nightlife, restored apartments; the most expensive per square metre.
Costa del Este Modern, safe and home to multinational offices; a car is needed.
Boquete and Bocas del Toro Mountains or beach, established expat communities, more limited connectivity.

Alternatives to the visa

Anyone planning to stay more than 18 months usually moves to permanent residency: Friendly Nations, if their nationality is on the list and they have an employment link or investment, or Qualified Investor, with investment from 300,000 dollars. Anyone coming for only a few weeks enters as a tourist, with up to 90 days for most nationalities.

Frequently asked questions

Does Panama have a digital nomad visa?

Yes. The Short-Stay Visa for Remote Workers, under Executive Decree 198 of 2021, allows a 9-month stay extendable to 18 for anyone working for foreign employers or clients with income of at least 36,000 dollars a year.

Does a digital nomad pay taxes in Panama?

Not on foreign-source income. Panama applies a territorial system and taxes only income generated inside the country.

Can you work for Panamanian companies on the remote worker visa?

No. The visa requires that work be provided exclusively to companies or clients outside Panama.

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Sources

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By Daniela Bohórquez

Daniela Bohórquez is a writer at Radar Panamá. Venezuelan, 30, she writes about travel, tourism and business, with special attention to reviews of destinations, hotels and services. She lives between Panama, Italy and New York, which gives her a comparative view of how business is done in each market.

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