Panama tax guide
Planning reference for Panama using PAB salary values.
This is not an official government calculation. Confirm final details with PwC Worldwide Tax Summaries - Panama or a qualified tax professional.
Model coverage
A source-reviewed simplified salary model is available in the calculator.
Scope: Standard employee earning Panamanian-source salary. Includes employee social-security and educational-insurance payroll deductions. Mortgage, education, medical, dependent and other personal deductions are excluded.
Reference details
| Currency | PAB |
|---|---|
| National tax label | Personal Income Tax |
| Personal allowance | Not modeled |
| Employee contributions | Employee deductions: 9.75% social security plus 1.25% educational insurance, with no maximum contribution base. |
| Last source review | 2026-07-23 |
Modeled national brackets
| Band | Rate | Reference threshold |
|---|---|---|
| 1 | 0.0% | Up to 11,000 PAB |
| 2 | 15.0% | Up to 50,000 PAB |
| 3 | 25.0% | Top bracket and above |
Official source
PwC Worldwide Tax Summaries - Panama: https://taxsummaries.pwc.com/panama/individual/other-taxes
Tax rules, thresholds, allowances, and contribution limits can change. Use the official source above to verify the current rules before making a financial decision.