Panama

PAN

Panama is a Central American logistics and financial hub built around the Panama Canal, using the US dollar as legal tender alongside the Balboa, removing currency risk for dollar-based expats and retirees. Its territorial tax system exempts all foreign-source income from Panamanian taxation, a major draw for remote workers, investors, and pensioners with income earned abroad.

The Friendly Nations Visa offers accessible residency for citizens of over 50 designated countries, while the Pensionado visa provides generous retiree discounts alongside residency for qualifying pensioners. The passport ranks 38th globally with visa-free access to about 148 destinations, and dual citizenship is permitted. English proficiency is moderate (rank 63), strongest in Panama City's business districts.

Naturalisation requires 5 years. Healthcare (index 65) is reasonably good, particularly Panama City's private hospitals, though quality drops outside the capital. The cost of living (index 40) is low-to-moderate, with Panama City costlier than highland Boquete, a popular retiree enclave. Panama's post-2021 FATF grey-list status has created mortgage friction for some nationalities.

Naturalisation: 5 years
Tax system: Territorial
Currency: Balboa / US Dollar (USD)
Dual citizenship: Allowed
Capital: Panama City
Region: americas
Population: 4,351,000
Cost-of-living: 40 /100

Passport Rank

#38

Visa-Free

148

destinations

Visa-free travel

A Panama passport has visa-free access to 123 destinations. See the full Panama passport breakdown →

Passports that enter Panama without a prior visa (115)

Visa-free, visa on arrival, or on an eTA.

Bosnia and Herzegovina

Botswana

Brazil

Brunei Darussalam

Bulgaria+97 more

Community-sourced (passport-index, synced 2026-08-18) — verify with the embassy before travel.

Country Details

Capital: Panama City
Currency: Balboa / US Dollar (USD)
Languages: Spanish
Population: 4,351,000
Tax System: Territorial
Dual Citizenship: Allowed
Naturalisation: 5 years
Schengen / EU: No
Climate: Tropical
English Proficiency Rank: #63
Territorial Taxation: Yes — foreign-sourced income may not be taxed

Indices

Cost of Living

Safety

Healthcare

Quality of Life

148

Tax Summary

Tax System: Territorial
Territorial Taxation: Yes — foreign-sourced income may not be taxed
Naturalisation: 5 years of legal residency
Dual Citizenship: Allowed

Cost of Living by City

← scroll the table →

Monthly cost of living per major city in USD: rent, groceries, utilities, transit pass
City	Rent 1BR centre	Rent outside	Groceries	Utilities	Transit pass
Panama City	$900	$620	$280	$120	$25
Boquete	$550	$380	$250	$90	$15

Monthly USD figures. Typical central 1-bedroom rent, grocery basket for one, household utilities, monthly transit pass.

Climate

Panama City

27°J

27°F

28°M

28°A

27°M

27°J

27°A

27°S

27°O

26°N

27°D

Rainfall range: 20–280 mm/month · Daylight 12h (winter) to 13h (summer)

Boquete

18°J

18°F

19°M

19°A

19°M

18°J

18°A

18°S

18°O

18°N

18°D

Rainfall range: 15–430 mm/month · Daylight 12h (winter) to 13h (summer)

Visa Categories & Immigration Authority

Major Visa Categories

Tourist
Friendly Nations Visa
Pensionado
Solvencia Económica
Inversionista
Reforestation
Worker
Family
Permanent Residence

Authority: Servicio Nacional de Migración
Official Portal: www.migracion.gob.pa
Phone: +507 507-1800
Email: info@migracion.gob.pa

Naturalisation Details

Residence Years: 5
Language Test: Yes (Spanish (basic reading + writing))
Civic Test: Yes
Oath Required: Yes
Dual Allowed: No
Fee: $800
Processing: ~24 months

Real Estate

Avg price/sqm (capital): $2,500
Transaction taxes: 3%

Foreign buyers: Foreigners may purchase property with same rights as citizens. USD is official currency — no exchange risk. Panama City prime (Punta Pacifica, Costa del Este) $1,500-3,500/sqm. Transfer tax 2%; notary + registry ~0.5%; mortgage stamp tax 1% if applicable. Law 54 of 1998 provides tax stability for qualifying investments. Post-2021 FATF grey-list status may affect mortgage access for some nationalities.

International Schools

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International schools by city, curriculum, and annual tuition
School	City	Curriculum	Tuition (USD/yr)
International School of Panama	Panama City	IB + US	$14,000–$22,000
Balboa Academy	Panama City	US	$10,000–$16,000

Daily Life Logistics

Internet

100 Mbps median

50% fibre coverage

eSIM: Cable & Wireless Panama, Digicel Panama, Claro PA

Driving

IDP required

Local licence required after 6 months

Exchange eligible: Foreign licences + IDP accepted for 90 days; many nationalities may exchange within 6 months of obtaining residency

Pet Relocation

Quarantine: none

Rabies titre required

EU pet passport: not accepted

Safety

GPI Rank

#65

Global Peace Index ranking (lower is safer)

Common Risks

⚠taxi overcharging tourists in Panama City (use InDriver/Uber)
⚠ATM card skimming in Casco Viejo
⚠package tour booking fraud targeting retirees
⚠phone snatching on Cinta Costera

Examples of areas to avoid: El Chorrillo after dark, San Miguelito periphery late night, Calidonia some areas after dark

LGBTQ+ Legal Status

Same-Sex Marriage: Not legal
Civil Partnerships: Not recognised
Anti-Discrimination Law: No
ILGA Rank: #67

Religious Life

Halal Food: Limited
Kosher Food: Limited
Prayer Facilities: Common

Sample Citizenship Test Questions

Q1. Despite the Inter-American Court of Human Rights 2017 advisory opinion, same-sex marriage in Panama is:

Answer: Not legal — the Constitution defines marriage as between a man and woman

Source: Constitucion de Panama Art. 26

Q2. What is the official currency of Panama?

Answer: US Dollar (Balboa)

Source: Banco Nacional de Panama

Related Guides

Zero and low-tax residencies: the real list

Countries with zero personal income tax, territorial-only taxation, or special expatriate regimes — and what each one actually requires from you to qualify as a resident.

Exit tax: countries that charge you to leave

Country-by-country reference of departure taxes, deemed-disposition rules, and wealth-locking regimes that trigger when tax residency ends.

Related on The Citizenship Desk

Move here

Life logistics

Reference tables

Visa Programs

Panama Friendly Nations Visa

Panama PAN

Passive Income

Processing

3mo

Min. Income

—

Citizenship

Verified 2026-04-20

Panama Pensionado Visa

Panama PAN

Retirement

Processing

3mo

Min. Income

$1,000/mo

Citizenship

Verified 2026-04-20

Cities in Panama

Panama City

Panama City has spent two decades building one of the most deliberately foreigner-friendly residency systems in the region, anchored by the territorial tax system that exempts all foreign-source income from Panamanian tax and by the US dollar as legal tender, which removes currency risk for dollar-earning expats and retirees. The Friendly Nations Visa, introduced in the early 2010s, made Panama one of the fastest and cheapest residency routes anywhere for nationals of a defined list of countries; it was substantially reformed in 2021 and now requires either an employment contract or a qualifying investment (real estate or a term deposit) rather than the older, lighter-touch version, so applicants should verify current thresholds directly. The Pensionado Visa remains one of the most generous retiree programmes globally, open to applicants with a qualifying pension regardless of nationality. The city itself is a genuine logistics and financial hub built around the Panama Canal, with a skyline of high-rise condo towers that has expanded rapidly, giving newcomers an unusually large stock of modern apartments. Panama City combines big-city infrastructure — the region's first metro, international private hospitals, and a major airport hub — with a noticeably smaller footprint than São Paulo or Buenos Aires, part of its appeal to retirees wanting convenience without megacity scale.