How to Obtain a Panama Residence Permit Without Investment: Options for Remote Workers and Freelancers

Overview of the Panama Digital Nomad Visa

Among the options for obtaining Panama residency without investment, many foreigners are considering the remote worker visa or a digital nomad visa, as it’s also known. Besides the obvious advantage of the lower initial costs, we’ll review why this option is attracting freelancers from all over the world.

Key Benefits of the Digital Nomad Visa

There are various visas in the country of the canal today, which we can basically divide into two groups: those that demand a higher investment commitment and those with lower costs but harder requirements. 

Probably the best visa ever is Friendly Nations, which you can get without any investment if you obtain a duly registered work contract from a Panamanian company. Furthermore, you have to be from any of the countries considered “friendly”. The downside is that you can't ever be eligible if you don't come from any of these countries, or you are not lucky enough to obtain such a contract. 

In this regard, the nomad visa offers a solution because it's relatively easy to access as long as you earn the minimum required by law.

Eligibility Requirements

Proof of Financial Self-Sufficiency

To apply for this visa, the applicant must be self-sufficient, that is he/she must earn at least $36,000 a year, a sum that can be in dollars or in any other currency. Secondly, the applicant's job or commercial activity must be located abroad, and hence the income must be from foreign sources. 

Proof of Employment or Professional Activity

Foreigners can receive income, whether from their own company or professional services provided to third parties. In both cases, they must provide proof of the existence of such activities. 

Those digital nomads who own their company must submit proof that the entity actually exists and is duly registered in the corresponding country. For the second possibility, a sworn declaration must be submitted to describe the exact relationship between the service provider and the clients. 

Requirements to obtain a remote worker visa in Panama in a nutshell

• Working remotely in your own company or providing services outside of Panama
• Proving you own your company abroad and that is duly registered (or)
• Providing proof of your work relationships with clients through documents stating every detail, from the description of the services to the charged fees and the source of income
• Earning at least $36,000 a year
• Obtaining income from abroad
• Providing bank statements showing a periodic income of the stipulated amount
• Providing a sworn affidavit that the freelancer won't engage in work inside Panama
• Accepting financial responsibility in case of an eventual deportation

Private Health Insurance

Remote workers, as stipulated in the executive decree 198, will have to prove they are in excellent health by submitting a medical certificate. Furthermore, they must have a medical insurance active in Panama throughout the residency and the stay.

Application Process

Step 1: Prepare Your Application Package

This is the time that demands the most patience on the side of future residents. Bank statements, incorporation documents, health certificates, and proof of identity have to be gathered carefully. In this regard, the hardest burden probably falls on those who are independent workers, as they'll have to prove (in full detail) the exact nature of the business relationship they maintain with their clients.

Step 2: Submit Your Application

Once all the forms and documents are ready, they should be submitted in person to the migration office in the Republic of Panama. Naturally, this requires entering the country as a tourist, which can demand other permits or conditions depending on the case.

Step 3: Wait for the Review

At this stage, there's not much to do but wait for the migration officer's decision.

Step 4: Receive Your Visa Approval

Once approved, the digital nomad becomes a resident for nine months under the remote worker’s visa.

Step 5: Enjoy Remote Work from Panama

Now it's time to enjoy the fruits of one's efforts by living in an outstanding country with tax benefits and supreme living standards, as we will explain below. 

Duration of Stay and Possibility of Extension

The remote work visa is granted for nine months. If the digital nomad wishes to renew it, it can be done for another nine months by providing the same documents under the same conditions.

Work Permit

Due to the nature of this visa residency, the freelancer or remote worker is allowed to work in Panama as long as the activity takes place abroad. Hence, there is no need to apply for a work permit.

Comparison with other visas

Permitted Activities

The main question here is not what the permitted activities are, but where. Residents can work as freelancers, service providers, or have their own company as long as all those activities are conducted abroad. 

Government Fees and Costs

During the application, there is a fee of $250, payable to the national migration services, and the residency card costs $50. 

More information

Taxes for Digital Nomads in Panama

We would like to stress the value of the remote worker visa when it comes to taxation. When we discuss tax advantages, we have to point out that taxes here are relatively lower than in other jurisdictions. Nevertheless, this is not the main perk. 

Being a territorial taxation country, Panama doesn't tax income derived abroad. With this, it's not that hard to do the math: living in Panama, all your income from abroad will be tax-free. The workers, however, must understand that if they transfer themsleves any amount of money to a local account, this will be taxable. 

Disclaimer: this article must not be taken as tax or migration advice. The information described here might be outdated at the time of reading and must be confirmed with specialists. 

Other available visas in Panama (both for Non Investors and Investors)

• Friendly Nations Program
• Reforestation visa 
• Professional visa
• Qualified investor
• Pensionado visa
• Transit visa
• Economic solvency
• Investor in Panama Pacific
• Investor in the audiovisual and movie industries
• Foreigner employed under the 10% quota of foreign employees 
• Foreigners employed in aviation companies
• Married with Panamanian
• Visas for specific countries
• Dependent of permanent resident

Living in Panama as a Digital Nomad

Best Cities to Live in Panama

Panama City

Undoubtedly, the best city to live in Panama for freelancers, digital workers, investors, non investors, residents or locals is Panama City. For the past 10 years, it has experienced unspeakable growth, which is showing, for example, in the construction of the beautiful Cinta Costera. 

From what was a wild land next to the Panama Bay, the government has created a lovely seaside walk with trails for jogging and bicycling, delightful gardens, fountains, and colorful ornaments. 

In Panama City, you will feel like living in New York or in a little Miami because of the cosmopolitan environment, great nightlife, ample culinary options, advanced infrastructure, and best-in-class real estate. 

David

With a little over 80,000 inhabitants, David is the largest city outside of the Panama metropolitan area, and it's the best place to go if you want to combine urban life with tranquility. While Panama City is stunning, it experiences the same issues as any capital, especially when it comes to traffic jams.

For those freelancers whose priority is socialization and nightlife, there’s no better place than Panama City. On the other hand, David is for those who want the same things but dialing it down in a calmer place. When it comes to distance, the freelancer should know that Davis is closer to Costa Rica than to the capital.

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Boquete

Boquete is one of those places that you wouldn't suspect exists in Panama. When you mention Panama, you think of sandy beaches, skyscrapers, surfing, diving, and the abundant rain and the hot sun of the tropics. 

Boquete is quite the opposite as it offers a mountain landscape, a cooler climate, bucolic sceneries, and a laid-back lifestyle. Those who visit Boquete are usually fond of hiking and love the great coffee that is produced in the area. 

Coronado 

Coronado can be a great place to compromise because it is a short ride away from Panama City with access to the beach. Workers here can lead a tranquil lifestyle, and, at any given time, they can jump in a car and be in the city center in an hour or so.

Cost of Living

Everything is better when we combine such benefits with low costs. In Panama, you can have a lifestyle similar to what you get in Miami at a quarter of the price. From getting a burger to renting an apartment, the Central American country is more cost-effective than most cities with the same caliber. 

As an example, renting a one-bedroom apartment is possible for $800 (1500 maximum, depending on quality), a number that you certainly can’t find in Miami, New York, Paris, or Sydney.

Frequently Asked Questions

How long is the Panama Digital Nomad Visa valid?

Digital nomads can live in Panama for nine months under the said visa.

Can I work for a Panamanian company with this visa?

No. The name of the visa speaks for itself: “remote workers” are supposed to work remotely, that is, outside of Panama. 

What is the minimum income requirement for the Panama Digital Nomad Visa?

The minimum necessary income is at least $36,000 a year or $3000 a month.

Do I need health insurance to get the visa?

Absolutely. The health insurance must be viable in Panama and must have at least the same duration as the foreigner's stay in Panama.

Can I extend my stay beyond 18 months?

The answer is no, again, because, according to the corresponding decree, the extension can be done once. 

Conclusion: Why Choose Panama for Remote Work?

A program like Panama's remote worker visa is ideal for non-investors and digital nomads who want to spend some time in Panama and experience the culture and ambiance. With the main advantage being the territorial tax regime, Panama offers an excellent lifestyle at lower costs. This brings the chance of exploring the world, creating experiences, and getting to know one of the most exhilarating cities in Central America. 

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