Individuals
Individuals have an exemption from income tax on the first USD $ 11,000.00 of the net taxable income and must submit the annual return of income that expires on March 15th of each year.It is possible to request an extension until April 15 before the expiration of the aforementioned period before the General Directorate of Revenue through the E-Tax system.
Aliquot of income tax for individuals
| Up to US$ 11,000.00 | 0％ |
| From US$ 11,000.00 to US $ 50,000.00 | 15％ |
| More than US $ 50,000.00 | US$ 5,850.00 for the first US $ 50,000.00 and a rate of 25% on the surplus. |
The filing of a late income tax return carries a fine of US $ 100.00
Legal entities that generate local income have the obligation to submit an income tax return where they must make in detail of all their income and deductible expenses for their fiscal period. The fixed rate for legal entities is of 25% of the net taxable income. The deadline for the annual tax return for legal entities, expires on March 31th of each year. However, it is possible to request an extension to the General Directorate of Revenue through the E-Tax system until April 30th. The filing of the late income tax return carries a fine of US $ 500.00.
Payment of income tax
On March 31th of each year, the period to pay the income tax for individuals and legal entities expires. The payment after March 31 of the income tax will cause surcharges and default interest.
Annual Return of the Municipality of Panama – Municipal Taxes
On March 31th, is the deadline to submit and pay the Annual Income Tax Return to the Municipality of Panama. Failure to submit the annual return within the deadline will result in a fine of five hundred dollars (US $ 500.00) and could even lead to the closure of the commercial place of business.
Likewise, the payment after March 31 of the tax will cause a surcharge of 10%.
