North America
Panama is a top destination for digital nomads and retirees, offering a dedicated Remote Worker Visa, the famous Pensionado retiree program with exceptional discounts, and the Friendly Nations Visa for 50+ countries. The country uses the US dollar, has modern infrastructure, and offers a territorial tax system where foreign-sourced income is not taxed. Panama City features world-class connectivity and amenities, while beach towns and mountain retreats like Boquete offer affordable alternatives.
Visa requirements vary by nationality
Panama's official digital nomad visa under Executive Decree 198 (2021). Allows remote workers earning $3,000+/month from foreign sources to live in Panama for up to 18 months with 0% tax on foreign income.
Minimum $36,000/per_year
Alternative: Families (spouse + children) must show $4,000/month total income per some sources, though the original decree does not explicitly address dependents.
Remote work for foreign employers/clients is the explicit purpose of this visa. Work must have "effects abroad" only. Any local business activity is strictly prohibited and will result in visa cancellation.
Extension: 9 months (max 1x)
Cost: $300
Process: Extension requires the same documentation as the original application. Must be submitted before current visa expires. Total stay cannot exceed 18 months.
Renewal: After 18 months, you must leave Panama or apply for a different visa category such as Friendly Nations Visa or Pensionado if eligible.
Panama operates a territorial tax system: income earned from foreign sources is NOT subject to Panamanian income tax. DN visa holders working remotely for foreign employers/clients pay 0% local income tax. If you provide services with effects within Panama (local clients), that income is Panama-source and taxable at progressive rates (0% up to $11,000, 15% $11,000-$50,000, 25% above $50,000). The DN visa explicitly prohibits local work. Source: PwC Tax Summaries, Jan 2026.
Citizens of 50+ friendly nations can obtain 2-year provisional residency by investing $200,000 in real estate or bank deposit, or securing employment. Path to permanent residency and citizenship. Changed in 2021: no longer grants immediate permanent residency.
As a provisional or permanent resident, you can work remotely for foreign clients without restriction. For local employment, a separate MITRADEL work permit is required.
Panama territorial tax: 0% on foreign-sourced income. Panamanian-source income taxed at progressive rates: 0% up to $11,000, 15% $11,000-$50,000, 25% above $50,000. Investment income from bank CD may be subject to interest withholding. Dividends from Panamanian sources: 10%. Source: PwC.
Panama's renowned retiree visa for anyone with a lifetime pension of $1,000+/month. Grants permanent residency with extensive discounts (up to 50% on entertainment, 25% on restaurants/airlines/utilities). One of the world's best retirement visas. No minimum age.
Minimum $1,000/per_month
Alternative: Reduced to $750/month if you purchase real estate in Panama valued at $100,000+. Additional $250/month required per dependent (spouse, children under 25).
As a permanent resident, you can work remotely for foreign clients without restriction. Cannot be employed by Panamanian companies but can own businesses and receive passive income.
Panama territorial tax: 0% on all foreign-sourced income including pensions. Pensionado residents can own businesses and receive passive income. Only Panamanian-source income taxable. Tax-free import of household goods (up to $10,000) and one vehicle every 2 years. Source: PwC.
Citizens of 100+ countries can enter Panama visa-free for up to 90 days (180 days for US and Canadian citizens under Resolution 22706). Must leave for 30 days before re-entry.
Panama does not explicitly prohibit remote work for foreign clients on tourist entry, but it is not formally authorized. The existence of the DN visa suggests the government prefers remote workers to use that dedicated visa. In practice, many digital nomads work remotely on tourist entries.
Tourists are not tax residents. Under the territorial tax system, foreign-sourced income is not taxable in Panama regardless. However, tourists are not authorized to work.
Under Executive Decree 521 (modified by Decree 196, October 2024), nationals needing a Panama visa can enter for up to 30 days if they hold a valid multiple-entry visa or residence permit from the US, Canada, Australia, UK, Japan, South Korea, Singapore, or any EU state.
Tourist visas do not allow any work activities, even remote work for foreign companies. Use the Digital Nomad Visa instead.
Short-term visitors (30 days) are not tax residents. Foreign-sourced income is not taxable in Panama under the territorial system.
Two-year work visa for qualified foreign professionals with validated degrees. No employer sponsorship required. Path to permanent residency. Some professions (law, engineering, accounting, psychology) reserved for Panamanians.
As a resident visa holder, you can work remotely for foreign clients without restriction. For local employment, a separate MITRADEL work permit is required. The visa is not tied to a specific employer.
Panama territorial tax: only Panamanian-source income taxable. If employed locally: progressive rates 0% up to $11,000, 15% $11,000-$50,000, 25% above $50,000. Foreign-source income (remote work for foreign clients) is 0% taxed. Source: PwC.
Visa requirements can change frequently. This information is provided for general guidance only and should not be considered legal advice. Always verify current requirements with the official embassy or immigration authorities before making travel plans. Last updated: December 1, 2025