Country hub · Central America · Updated August 2026

Panama, in full.

Six ways to live in Panama and what each one actually costs: the investment route and the threshold that rises in October, the pension route that asks for no capital at all, the Friendly Nations rules that were rewritten in 2021, a territorial tax system that genuinely ignores foreign income, and the five-year runway to a passport that no amount of money shortens.

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Territorial tax, 0% on foreign income Dollarised since 1904 Permanent residence on day one

Panamanian tax on foreign-source income

USD

Dollarised since 1904, no currency risk

5 years

Of residence before a citizenship petition

~140

Visa-free destinations on the passport

Why Panama

The country built to be passed through

Panama is the only country in the Americas that built its economy around being a place other things pass through. The canal, the banking centre, the Colón Free Zone and a dollarised currency are not lifestyle features; they are the reason a small Central American republic has the regional headquarters of companies many times its size.

For anyone building a second base, that history produces an unusual combination: a territorial tax system that genuinely ignores foreign income, a residence regime with more distinct routes than any of its neighbours, and a passport at the end of a five-year runway. What it does not produce is a shortcut. Panama sells residence, not nationality.

◇ Executive Decree 722 of 2020 as amended by Decree 193; Executive Decrees 197 and 226 of 2021; the Pensionado regime and its statutory discount schedule; the Constitution of the Republic of Panama on nationality. Figures verified August 2026.

Four reasons, and two we will not soften

Panama is sold on a skyline and a tax rate. The parts that do not fit on a brochure are the ones worth reading first.

01 Tax Territorial taxation, and it means it Income arising outside Panama is outside Panamanian income tax, whatever your residence status. No wealth tax. The system is old, stable and not a concession that gets withdrawn — it is how the country has worked for a century.
02 The dollar No currency to devalue Panama has used the US dollar as legal tender since 1904 and has no central bank issuing its own note. For a client whose plan exists because of currency risk somewhere else, that is the whole point.
03 Choice of route Six ways in, not one Investment, a friendly nationality, a pension, self-solvency, a business, reforestation. Most countries offer one or two. The practical consequence is that the right question is never “do I qualify” but “which route is cheapest for my situation”.
04 Speed of status Permanent residence on day one, on two routes The Qualified Investor Visa and the Pensionado both grant permanent status at approval, with no temporary stage and nothing to renew. That is unusual anywhere, and it starts the citizenship clock two years earlier than the Friendly Nations route.
05 The honest part Panama City is expensive, and humid The cost-of-living figures that circulate come from the interior. A comparable apartment in Costa del Este is priced against Miami. The dry season is superb and the other eight months are not, and the climate is the most common reason people leave.
06 The other honest part There is no Panamanian passport for sale Panama runs no citizenship-by-investment programme. Capital buys residence and shortens nothing after that: five years of genuine residence, Spanish, civics and a discretionary petition. Anyone quoting you a price for a Panamanian passport is selling something that does not exist.

The routes compared

Three main routes, side by side

The position as at August 2026, with one confirmed change ahead: the Qualified Investor real estate minimum rises from USD 300,000 to USD 500,000 on 16 October 2026.

	Qualified Investor	Friendly Nations	Pensionado
Entry cost	USD 300,000, rising to USD 500,000 on 16 Oct 2026	USD 200,000, or none on a job	None; a pension of USD 1,000/month
Who can apply	Any nationality	Around 50 nationalities	Anyone with a lifetime pension
Financing	Not permitted	Permitted on property	Not applicable
Status granted	Permanent, immediate	Temporary 2 years, then permanent	Permanent, immediate
Right to work	No	Yes, on the employment route	No
Citizenship petition	Year 5	Around year 7	Year 5

Executive Decree 722 of 2020 as amended, Executive Decree 197 of 2021, and the Pensionado regime. Panamanian immigration rules are set by decree and amended often: verify against the Gaceta Oficial before acting on any figure here, including ours.

Residency

Living in Panama: every route in

Two routes grant permanent residence outright, with no temporary stage and nothing to renew. One begins with a two-year permit. One requires no capital at all, only a pension. And three more exist that we advise on but have not yet written up.

01 Residency by investment The Qualified Investor Visa, or “Panama Golden Visa” Permanent residence directly from USD 300,000 in property, USD 500,000 in listed securities or USD 750,000 on deposit, with no temporary stage and no minimum stay. The real estate threshold rises to USD 500,000 on 16 October 2026. Read the investment guide →
02 Retirement The Pensionado, and the discounts written into law No capital at all: a pension guaranteed for life, from USD 1,000 a month, converts into permanent residence at approval. Plus a statutory schedule of discounts on healthcare, travel and utilities that businesses are obliged to honour. Read the retirement guide →
03 Friendly Nations USD 200,000, for about fifty nationalities Panama’s most-searched route and its most misreported: Decree 197 rewrote it in 2021, ending the cheap permanent-residence version. Property or a term deposit at USD 200,000, or a genuine Panamanian job, then two years temporary before permanent status. Read the Friendly Nations guide →
04 Remote work The digital nomad visa A short-stay permit for remote workers earning from foreign sources. It is a stay, not a settlement route: it does not lead to permanent residence and does not start a citizenship clock. Read the nomad guide →
05 Not documented here Self-solvency, business investor and reforestation Three further permanent-residence categories exist: self-economic solvency at USD 300,000 in deposit or property, a business investor route from around USD 160,000, and the forestry regime. We advise on all three; they do not yet have a guide on this site.
06 Choosing The cheapest route is rarely the right one If the objective is a passport, the Friendly Nations Visa costs USD 100,000 less and puts the citizenship petition roughly two years further away. Price the routes against the outcome you actually want, not against each other.

Citizenship

The passport, and the five years before it

Naturalisation runs on five years of residence counted from permanent status, a tested Spanish and civics examination, and a decision that remains discretionary. The residence route you pick at the start moves that date by about two years.

01 Citizenship Naturalisation, and the dual nationality question Five years of residence counted from permanent status, three if you are married to a Panamanian. A tested Spanish and civics examination, a discretionary decision, and a constitutional renunciation requirement that is more complicated than either side of the internet claims. Read the citizenship guide →
02 The correction that matters Panama has no citizenship-by-investment programme It is one of the most heavily marketed falsehoods in this industry. Investment reaches permanent residence immediately, and from there the clock is identical to the pensioner’s and the employee’s. If a passport in months is the requirement, Panama is the wrong country.

How we work

From enquiry to cédula

01 Work backwards from the outcome A residence card, a tax position and a passport are three different objectives with three different best routes. Most enquiries arrive naming a programme; a good share of them are better served by another one.
02 Check the decree as it stands this month Panamanian immigration runs on executive decrees, not statute. The Qualified Investor threshold changes on 16 October 2026 and the Friendly Nations rules were rewritten in 2021. We work from the current text.
03 Verify title and value before any purchase Panamanian property includes possessory rights that are not registered title and do not qualify, and under-declaration at the notary is common and disqualifying. The registered value is the value assessed.
04 Start banking and apostilles first Panamanian account opening for non-residents takes weeks and a thick source-of-funds file. Apostilles and certified translations routinely take longer than the immigration filing itself.

Straight answers

The questions we get every week

What is the cheapest way to get residency in Panama? +

For anyone with a pension guaranteed for life, the Pensionado, which requires no capital at all — only USD 1,000 a month of qualifying income. For anyone holding one of the roughly fifty friendly nationalities and willing to take a job in Panama, the Friendly Nations employment route also requires no capital. Otherwise the entry point is USD 200,000 through Friendly Nations, or USD 300,000 through the Qualified Investor Visa.

Does Panama have a golden visa? +

Not by that name. The programme marketed everywhere as the Panama Golden Visa is officially the Qualified Investor Visa, created by Executive Decree 722 of 2020. It grants permanent residence directly from USD 300,000 in real estate, a threshold that rises permanently to USD 500,000 on 16 October 2026.

Can I buy Panamanian citizenship? +

No. Panama has no citizenship-by-investment programme. Investment can take you to permanent residence immediately, but naturalisation still requires five years of genuine residence, a Spanish and civics examination and a discretionary decision by the executive.

How much tax will I pay as a resident of Panama? +

Nothing to Panama on income arising outside the country: the system is territorial and applies that way regardless of residence status. Panama-source income is taxed progressively. Your own country of origin may take a different view, and for US citizens it certainly does.

Do I have to live in Panama to keep residency? +

There is no continuous-presence requirement on the main permanent-residence routes, though the Qualified Investor Visa expects a visit roughly every two years and any Panamanian residence can be put at risk by prolonged absence. Naturalisation is a stricter test and does look at whether you genuinely live there.

Is Panama better than Paraguay or Uruguay for a Latin American base? +

Panama has the dollar, the better banking system and more residence routes; Paraguay is far cheaper and reaches citizenship in three years rather than five; Uruguay is the most institutionally solid and the most expensive. The right answer depends on whether the objective is tax, cost or a passport.

Written by David Lincoln Founder & CEO · IMCM

Last reviewed 31 August 2026. Programme terms are set by the relevant government and can change; confirm any figure before acting on it.

Structure your move to Panama.

Panama is rarely the whole plan. We structure it as one component: route selection, the filing, the banking, the tax position and the citizenship clock, handled end to end.

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