Individual - Income determination

Last reviewed - 23 January 2024

Individuals must consider as gross income the total income received from their activities undertaken in the Panamanian territory.

Employment income

Compensation includes salary, premiums, share-profits, living expenses allowance, house allowance, car allowance, tax reimbursements, benefits-in-kind, retirement benefits, and any other compensation in kind.

Representation allowance is subject to a definitive WHT at the following rates:

Representation allowance (USD) WHT on column 1 (USD) WHT on excess (%)
Over (column 1) Not over
0 25,000 0 10
25,000 2,500 15

Capital gains

See Capital gains tax in the Other taxes section for a description of how capital gains are taxed in Panama.