Tax amnesty in Panama

Tax amnesty in Panama 10.11.2018

Legislative bodies of Panama have enacted a Law 49 of 11 September 2018 (Law 49) that amends Tax Code of Panama and some other legal acts. The mentioned Law 49 establishes tax amnesty in Panama that exempts taxpayers from liability for non-payment or past due payment of some types of taxes and fees payable by different categories of individuals and legal entities.

Firstly, taxpayers of immovable property tax may be exempted from fines and interest imposed on non-paid or past due amounts of this tax if they manage to pay the outstanding sums of tax itself before 31 December 2018. As established by other instrument that regulates tax amnesty, namely Resolution of General Revenue Direction of Panama No. 201-6219 of 13 September 2018, this rule is applicable both to individuals and legal entities that own immovable property in Panama.

It is stipulated that the exemption from fines and interest is possible if the payment of immovable property tax itself was due before 31 August 2018. The outstanding tax may be paid wholly or partially before 31 December 2018. To apply for such exemption the taxpayer must submit a special form or pay the tax with indication of special payment instruction number.

Secondly, tax amnesty is applicable to fines and interest for non-payment of fees for annual renewal of legal entities (companies of any legal forms and private foundations). In the same manner, tax amnesty covers fines and interest for past due payment of restoration fee for legal entities that have been struck off the Register of companies.

In such case the requirement is the same that one for immovable property taxpayers: outstanding amounts of annual renewal or restoration fees must be paid before 31 December 2018. The fee must be overdue before 15 July 2018 in order to be exempt from fines and interest for non-payment.

It is important that the Law 49 does not establish any restrictions regarding legal forms of companies, place of business, amounts of tax debts, etc., that may obstacle tax amnesty for legal entities. It covers all types of legal entities incorporated in Panama without exceptions, including those owned by non-residents who are members or beneficial owners of companies, those conducting business outside of Panama, and so on.

Tax amnesty is also applicable to social security contributions payable by individuals who are independent contractors or employees and legal entities that are employers: the payment of outstanding contributions can be made without imposition of fines and interest before 31 December 2018.


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