How Can You Acquire Legal Residence in Panama?

There are several ways of acquiring a legal residence permit in Panama. Making an investment in the country’s economy is probably the surest way to Panamanian residence. Panama offers several investment options and some of them are quite affordable. If you have relatives in the country, obtaining a legal residence permit is going to cost you almost nothing. Besides, there is a Friendly Nations visa program in Panama that makes it easy for citizens of some countries to establish residence in the country.

Advantages of acquiring legal residence in Panama

Today, Panama is a rapidly developing country that can be compared to Singapore as it was some 20-25 years ago. You can obtain residence in Singapore by investment but it costs a lot. Panama, on the contrary, sets rather affordable thresholds for foreign investors. We have to note that Panama does not ‘sell’ its citizenship to foreigners as some of its neighbors do. It is not planning to launch a citizenship-by-investment program either so Panama is going to remain a highly reputable jurisdiction for years to come.

The key reasons why you should consider applying for legal residence in Panama include the following ones:

  • Simplicity of the application process and affordability of the residence programs;
  • Lack of obligation to live in Panama;
  • Visa-free travel around the world including Europe and the USA;
  • An advanced banking system in Panama;
  • A gentle tax system;
  • Relatively high salaries and availability of jobs;
  • The US dollar is on free circulation in Panama;
  • Wonderful investment opportunities;
  • A high income from property rent and bank deposits;
  • An opportunity to become a citizen of Panama in 5 years.

Economic Investor visa

The Panamanian Economic Investor program will suit well-to-do people from other countries. If you are interested, you have several investment options to choose from:

  • Investment into the forest industry and forest restoration;
  • Investment into a large-scale business venture that creates new jobs;
  • Bank deposit;
  • Investment into real estate in Panama;
  • Mixed investment: purchase property and make a bank deposit.

How much should you invest to become a legal resident in Panama?

The required investment amounts differ. You can qualify for a Panamanian residence permit if you invest US$ 300,000 in one of the following ways:

  1. Buy real property worth as much;
  2. Put US$ 300,000 in a bank;
  3. Combine these investment options spending US$ 300,000 in total.

You can buy 3 apartments 50 square meters each for US$ 300,000 in Panama City. You can make 7% or so per year if you rent them out. Thus, if you live in one of the apartments and let the other two on a lease, you will have about US$ 1,500 per month from rent. You can easily live in Panama on such an income.

If you put the money in a Panamanian bank, the interest rate is going to be between 2% and 4%. Please note that interests are not taxed in Panama.

Purchasing one apartment and putting the rest of the money in a bank is also a viable option to consider.

An important note: if you are applying for a residence permit in Panama with your family, an additional investment of US$ 2,000 is due for each dependent family member.

If you invest US$ 300,000 into Panama, you will get a residence card after 2 to 4 months. The card is valid for 2 years and you can extend it afterwards. After living in Panama on a residence card for 5 years, you can apply for citizenship of the country by naturalization.

Investing into business and creating new jobs in Panama

Investing in a business venture that can create jobs in Panama is an alternative to buying property and/ or making a bank deposit.

You can qualify for legal residence in Panama if you invest in an existing company or start a new company thus creating at least 5 new jobs. In this case, the required investment amount is US$ 160,000.

If you open a company in Panama, you are going to love engaging in international business operations. The territorial taxation system is applied in the country, which means that your income made in other countries is not going to be taxed in Panama.

Investing into reforestation in Panama

The most affordable investment option is applying for a Reforestation visa in Panama. The visa will serve as a residence permit but the required investment amount is only US$ 80,000.

An important note: you can invest only in a Government-approved reforestation project and it has to cover an area of at least 5 hectares.

The authorities of Panama actually are killing two birds with one stone through their reforestation program. First, they attract foreign direct investments and second, they contribute to restoring the environment in the country.

Friendly Nations visa program

If you are a citizen of one of the countries listed below, you can make a 3-year fixed-term bank deposit of US$ 200,000 and this fact alone will make you eligible for a residence permit. In 2024, the list of Friendly Nations includes the following countries:

  • United Kingdom;
  • United States;
  • Andorra;
  • Argentina;
  • Australia;
  • Austria;
  • Belgium;
  • Brazil;
  • Canada;
  • Chile;
  • Croatia;
  • Cyprus;
  • Czech Republic;
  • Denmark;
  • Estonia;
  • Finland;
  • France;
  • Germany;
  • Greece;
  • Hong Kong;
  • Hungary;
  • Ireland;
  • Israel;
  • Japan;
  • Latvia;
  • Liechtenstein;
  • Lithuania;
  • Luxembourg;
  • Malta;
  • Monaco;
  • San Marino;
  • Montenegro;
  • Holland;
  • New Zealand;
  • Norway;
  • Poland;
  • Portugal;
  • Serbia;
  • Singapore;
  • Slovakia;
  • Spain;
  • South Africa;
  • South Korea;
  • Sweden;
  • Switzerland;
  • Taiwan;

You are free to live and work in Panama if you hold a Friendly Nations visa.

How to become a citizen of Panama

As we have noted above, you cannot ‘buy’ citizenship of Panama. Whatever investment option you choose, you will have to live in the country as a legal resident for 5 years before you can apply for citizenship. If you marry a Panamanian citizen, you can qualify for citizenship of the country after 3 years.

When the minimum residency period is over, you have to supply the following documents to the Panamanian immigration service if you would like to become a citizen of Panama:

  • You home country’s passport;
  • Your photographs;
  • Application for citizenship of Panama;
  • Renouncement of your home country’s citizenship;
  • Medical examination report;
  • Confirmation of your solvency;
  • Receipt confirming payment of the state duties.

Panama does not allow dual citizenship. For this reason, many foreigners live in the country on residence permits and keep extending them. Living in Panama on a residence permit is fine unless you want to vote in the national elections or run for a public office. We dare think that you do not.

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