Dedicated to providing you with credible information about living overseas
Best Places In The World To Retire Community Questions and Answers about living and retiring abroad

Questions & Answers

 
Q & A Menu Q & A BY TOPIC
To navigate, use menu bar to the left
David Btesh of Pacific Realty / Pacific Developers – Best Places In The World To Retire User Account
Bedroom in King's Park, Panama City, Panama – Best Places In The World To Retire – International LivingThere’s a program in Panama on new construction that provides a 20-year exemption on property taxes. There have been some changes recently.  Now the length of time of the exemption is on the value of the property, according to a scale. A million-dollar property is exempted for 5 years, and as the price of the property becomes less, the amount of years on the exemption gets longer. So if it’s $100,000 property, you get a 20-year exemption. If the property is worth $500,000, I suspect you would get a 10-year exemption. 
 
The exemption goes with the property, not with the person.  You don’t have to do anything when you buy it. You have to register it, so if you sell it to somebody else, it’s already registered. 
 
If you had a property that had, as an example, a 10-year exemption, and the first person had it for 4 years and then you bought it, you would have 6 years remaining on that exemption. The property has a birth date.
 
(Bedroom in King's Park, Panama City, Panama, pictured.)
US: 406-551-4775
lars forsberg of Longboat Retirement – Best Places In The World To Retire User Account
Beach side homes in Chiriqui, Panama – Best Places In The World To Retire – International LivingWhile there are no specific programs for retirees you can use the money that you have in your IRA or 401k to purchase real estate in Panama.  There are rules and regulations that you must follow specifically to avoid taxes and penalties.
 
(Beach side homes for surfers in Chiriqui, Panama, pictured.)
Iván Eskildsen of Cubitá Group – Best Places In The World To Retire User Account
New housing development  for the Cubita Group, Chitre, Panama – Best Places In The World To Retire – International LivingThe Panamanian property tax system provides a tax break on new properties, which is a benefit provided to both foreigners and locals.  The terms of the tax break depend on the sales price of the property and is based only on the portion of the property assigned to construction cost, as opposed to the land. Properties with a construction cost above US $300,000 receive a tax break of up to 5 years. Properties from $120,000 up to $300,000 receive a tax break of up to 10 years, and properties from $100,000 up to $120,000 receive a tax break of 20 years.
 
The portion of the property that is assigned towards the lot or land is subject to taxation but the improvement or the construction portion provides the tax benefits and tax breaks. It’s quite an interesting benefit. This tax benefit is both for Panamanians and foreigners. They usually ask for the date of the occupation to determine the start time of the tax break and there are a few other requirements but they are usually very attainable. It has nothing to do with your nationality, visa status, or even your age.  This tax exemption can be passed from owner to owner, so, if you buy a property that has time remaining on its exemption, you will be entitled to the remainder of the exemption, or can pass it on to new owners at a later date, until such time as the exemption is exhausted.
 
(New housing development  for the Cubita Group, Chitre, Panama, pictured.)
Jeff Barton of Punta Pacifica Realty – Best Places In The World To Retire User Account
Trump Tower in Punta Pacifica, Panama towers above the Bay of Panama – Best Places In The World To Retire – International LivingThere is a program for purchasers of new construction in Panama to receive a property tax exemption that can be in effect for up to a maximum of 20 years from the date of completed construction. 
 
For example, the Trump Ocean Club was completed and given its occupancy in November of 2011.  As a result of receiving an occupancy letter at that point, the owners of the apartments received 20 years of property tax exemption. So, until 2031 there are no property taxes due on an apartment at Trump Tower. In Panama, there would still be a property tax due on the actual land, however, that is divided between all the apartments. To use our existing example, the owners of a Trump 2-bedroom worth approximately $600,000 would pay an average of $450 a year in property tax on the land. However, they would pay no property tax on the actual apartment itself.   There are many people with similarly luxurious apartment in the US who could pay $2,000 a month in property tax.  
 
(Trump Ocean Club in Punta Pacifica, Panama is unique along the Bay of Panama, pictured.)
Michael A. Martinez of B & B Real Estate Nicaragua / Panama Real Estate Information – Best Places In The World To Retire User Account
Western Azuero Peninsula beach with surfboard – Best Places In The World To Retire – International LivingThere are quite a few programs for retirees regarding real estate purchases and real estate taxes in Panama.. You have a 20-year property tax exemption on new construction. It does not apply on the land, but it does apply to the construction. A lot of homeowners take advantage of that. It has to be new construction and it can be transferred to a new owner for the remaining time of the 20 years.  
 
These laws have been continuously renewed, but they can change at any time. It’s not to say that they’re forever. Panama has the red carpet rolled out for foreign investment and it makes good business sense to keep these laws on the books. 
 
(Western Azuero Peninsula, Panama, pictured.)
Wee-Yiong Fung of Prestige Panama Realty – Best Places In The World To Retire User Account
There are no programs only for retirees regarding property taxes in Panama, but there is a property tax exemption for everyone, if the property qualifies.
 
In order to help achieve the Panamanian government’s goal of increasing new home construction, there is a property tax exemption in Panama for new construction.  The amount of years of the exemption depends on the price of the house, with fewer years exemption for more expensive homes.  For example, a home up to US $120,000 will qualify for a 30-year tax exemption.  A home between $120,000 to $200,000 will qualify for a 20-year tax exemption.

Both Panamanians and foreigners qualify for the exemption.

The exemption is for new homes only, and is for the home and the land.

The exemption is transferrable.  This means that, if a property qualified for the property tax exemption in the past and you buy the property, you would be entitled to the time remaining on the exemption for that property. 
Bill Brunner of abc realty panama – Best Places In The World To Retire User Account
Here in Panama, whoever you are, you pay your property tax on a graduated rate.  I may not remember the rates exactly and I could be a bit dated with my information, but I can give you an idea.  You pay nothing up to $30,000 of value.  From $30,000 to $50,000 you pay something close to 1.25%.  From $50,000 to $100,000, you’ll pay around 1.5%.  The rate just keeps going up like that.  So, using the example of the $300,000 house, in a very rough range, you may pay approximately $6,000 a year of property tax.  However, the property tax you pay tends to stay at around what you purchased the house for. They don’t have a lot of folks that go out to do tax assessments.   They’re talking about doing a re-assessment, but it’s going to take them year to do in the city, and I don’t know when are we going to get around to doing it in the interior.
 
There has been a 20-year exemption on property tax if you build. Let’s say you paid $50,000 for your lot and you build a $150,000 house.  For 20 years you won’t pay anything on the $150,000.  You just pay taxes on the value of the lot (in this example, $50,000), and not for the improvements to the lot for 20 years.  At the end of 20 years, then you start paying the full value, in this example, the $200,000.  This exemption may have changed recently, so if you plan on using it, please check for the most current status of the law.  
Roy Cannon of Gestoria Cocle - main office in Penoneme – Best Places In The World To Retire User Account
As a foreigner in Panama you have no special exemptions or treatment when buying land or a residence.  There are a number of tax exemptions based on the value of the land or when the residence was constructed, these are the same exemptions that a Panamanian enjoys.

As a Pensionado (retired visa holder) there are some discounts on the cost of property registration and mortgages, but not on the property taxes or purchase cost.

As a Pensionado you will be able to apply for discounts on your water bill, your rubbish removal bill, your electric bill and your land line telephone bill.  This discount is generally 25% of the base price, with potential limitations applied when you consume above certain levels.

Go Here Next

Go Here Next

 
Best Places In The World To Retire Expat Stories contains text, video, and photos by people just like you who are already living abroadUse the menu on this page to go to categories of Stories.
Best Places In The World To Retire Community Questions and Answers about living and retiring abroadUse the menu on this page to go to other categories of questions.
The Best Places In The World To Retire Location Advisor makes personalized recommendations for where to live and retire overseasGet matched to your ideal location to live abroad.
Best Places In The World To Retire Community Questions and Answers about living and retiring abroadAnswers about living, working or visiting abroad.
Best Places In The World To Retire Expat Stories contains text, video, and photos by people just like you who are already living abroadStories by expats & others about their life aborad.
Best Places In The World To Retire - MarketplaceFind for profit, non-profit and religious organizations.
 

Go Here Next

 
Best Places In The World To Retire Expat Stories contains text, video, and photos by people just like you who are already living abroadUse the menu on this page to go to categories of Stories.
Best Places In The World To Retire Community Questions and Answers about living and retiring abroadUse the menu on this page to go to other categories of questions.
The Best Places In The World To Retire Location Advisor makes personalized recommendations for where to live and retire overseasGet matched to your ideal location to live abroad.
Best Places In The World To Retire Community Questions and Answers about living and retiring abroadAnswers about living, working or visiting abroad.
Best Places In The World To Retire Expat Stories contains text, video, and photos by people just like you who are already living abroadStories by expats & others about their life aborad.
Best Places In The World To Retire - MarketplaceFind for profit, non-profit and religious organizations.
 

Our Pledge To You

Best Places will present information from the Community in a transparent way, unedited, except to conform with our Conditions of Use.

You can trust that Best Places does not manipulate content to sell you anything. All opinions in the Community Q & A and Expat Stories are those of its authors, not Best Places.

Get Known To The Community

Those who contribute to the Best Places Community are our heroes! And being a Best Places hero is fast, fun, and easy. Just go to Questions & Answers, find your first question to answer, click on it, and then click the Contribute Your Answer To This Question Button. If you’d rather enter a Story, go to Expat Stories and click the Contribute Your Story Button".

Contact/Support

Please contact us. We would love to hear from you! Customer Service
Technical Support
Business Development
Suggestions
Press
Phone: (US) 520-940-0481