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Panama Income Tax Calculator

Enter your income to see Panama’s progressive 0/15/25 income tax (ISR) and your take-home pay in US dollars. Compare any two tax years side by side.

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Tax Calculator

Panama — 2026 Tax Year

2026 Tax Year

Select the tax year to view applicable rules and rates

This is an estimate. Consult a tax professional for accurate calculations.

Enter your income to calculate

Fill in your gross income and filing status, then calculate to see your tax breakdown.

How to use Panama Income Tax Calculator

This Panama income tax calculator works out the income tax (ISR) for 2023 to 2026 on the progressive scale: 0% up to US$11,000, 15% from US$11,000 to US$50,000 and 25% above US$50,000. So a US$50,000 salary pays US$5,850. The calculator shows your income tax, effective rate and take-home pay in US dollars and lets you compare any two tax years side by side. Social-security (CSS) contributions of about 11% and personal deductions reduce net pay in practice and are documented but not deducted.

  1. Select your tax year (2023, 2024, 2025, or 2026).
  2. Enter your annual gross income in US dollars.
  3. Keep the filing status as Individual.
  4. Click Calculate to see your income tax, effective rate and take-home pay.
  5. Turn on the year-comparison view to see two tax years side by side.

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How Panama’s income tax works

Individual income is taxed progressively: the first US$11,000 is tax-free, income from US$11,000 to US$50,000 is taxed at 15%, and above US$50,000 the tax is US$5,850 plus 25% on the excess. Panama uses the US dollar (the balboa is pegged 1:1). The scale has been stable across 2023–2026.

Contributions and what is not deducted here

Employees pay social-security (CSS) contributions of 9.75% plus a 1.25% educational tax — about 11% of salary. Panama also allows deductions for mortgage interest, medical costs and dependants. These affect net pay but are documented rather than deducted, so the figure is a transparent upper estimate.

Worked examples

US$11,000

Inputs: US$11,000

Result: US$0 income tax · take-home US$11,000

US$50,000

Inputs: US$50,000

Result: US$5,850 income tax (15%) · take-home US$44,150

US$80,000

Inputs: US$80,000

Result: US$13,350 income tax (15%+25%) · take-home US$66,650

Glossary

Taxable income
Income remaining after eligible deductions and exemptions that tax rates are applied to.
Progressive tax
A system where higher portions of income are taxed at higher marginal rates.
Marginal rate
The tax rate that applies to your next unit of taxable income within its bracket.
Net income
Take-home income after taxes and mandatory contributions are subtracted from gross pay.

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