Top 6 Panama Residency Programs

Panama residency is the most sought after of the foreign residency programs. The reasons are simple: Panama residency is the least expensive and easiest to get of the “desirable” programs. Panama is a place you want to be and a residency you  want to hold.

For the American, there are several reasons why you want residency in Panama. For example, becoming a resident will help you qualify for the Foreign Earned Income Exclusion and thus reduce or even eliminate US taxes on your salary while abroad.

Second, Panama residency will give you access to all of the banks, investments, and international services available in Panama. Most banks in Panama are closed to Americans… not all, but most. To get access to the best banks, you need to have a residency visa.

As an aside, you’ll find residency is becoming a common requirement around the world. For example, if you want to start a business or open an account in Cayman Island, you must have residency there. For more information, see How to Move Your Internet Business to Cayman.

Third, if you will operate a business or hold significant investments in Panama (especially real estate), having residency in the country will improve your standing. Should you need to sue, or get involved in some type of legal dispute, being a lawful resident will improve your standing and ability to defend your position.

The same goes for your asset protection structure. The Panama corporation and Panama foundation combo is one of the best asset protection tools available. Improving your standing to that of a local (legal resident) improves the protections afforded through your structure.

Fourth, retiring to a low cost country like Panama will allow you to improve your quality of life. Residency in Panama can get you to that happy place in retirement for pennies on the dollar compared to major US cities.

For these reasons, and the fact that residency in Panama is a fraction of the cost of other countries, it’s the best jurisdiction available today.

Here are the top 6 residency programs in Panama:

  1. Panama’s Pension / Retirement Visa: Retirement is not just for seniors in Panama. Anyone over 18 with a lifetime pension or annuity paying a minimum of $1,000 per month can become a pensioner. Another $250 per month is required for each dependent (including your spouse).

The reason Panama requires a pension is simple – they don’t want to give residency to foreigners and then those people become wards of the State. Panama wants people who will spend money and support local businesses.

If you’re retired in the traditional sense, then distributions from your IRA, 401-k or defined benefit plan will get you residency in Panama. Alternatively, any pension or annuity that guarantees you the minimum monthly amount will qualify.

So, you can make a sizeable deposit into a US bank, get a monthly annuity of $1,000, and then apply for residency in Panama. If you will go this route, please contact me before setting up the account. There are a number of requirements to consider.

To figure out your deposit amount, see Fidelity Investment Calculator. In my case, I need $571,698 for a lifetime annuity of $1,500.

  1. Friendly Nations Visa: If you are from one of the top 50 countries in the world, you can get into Panama on the cheap. If you are not a retiree, getting residency in Panama through the Friendly Nations Visa is the way to go.

For a list of the 50 countries, please see my article Best Panama Residency Program. Scroll down to the middle of the page for the list.

Like the Pension Visa above, the costs for the Friendly Nations Visa are about $8,750 for the first applicant and $3,500 for dependents (including the spouse).

If you combine the Friendly Nations Visa with an investment in teak you can get residency for free. Make an investment of $20,000 in teak wood, get residency in Panama immediately, hold the trees for about 7 years, sell the trees, and make a profit. Simple and guaranteed because the teak trees have already been in the ground for 17 years.

And, again, your investment in teak comes with residency in Panama. For more information on this unique program, please send an email to

Note: The two options above are the only ones granting immediate permanent residency in Panama. The other options described below have a two year conditional period before you get permanent residency.

  1. Person of Means Visa: If you want to hold a large amount of cash in Panama, or you want to buy a home there, then the Person of Means visa might be for you.

There are two ways to prove to Panama that you are self sufficient, don’t need an annuity or a retirement plan, and will bring value to their economy:

  • Invest at least $300,000 in Panama real estate for the primary applicant, plus $2,000 for each dependent.
  • Deposit at least $300,000 in a 3 year Panama bank CD. An additional $2,000 deposit is required for each dependent.

It’s possible to combine these two options. For example, buy a home for $200,000 and open a CD for $100,000.

Depending on your age, this investment amount is comparable to lifetime annuity in #1 above. The Person of Means visa is most efficient if you plan to live in Panama and thus want to buy a home there. Also, the 3 year holding period is easier to plan for than the lifetime annuity.

  1. Professional Employment Visa: Foreigners working for a Panama company in a “professional” capacity can become residents of Panama after two years of employment. The term professional usually means that you have a college degree.

There are zones within Panama that have special versions of the Professional Employment Visa. The red tape and costs to process your visa will be lower in these areas, especially if you want to bring in several executives from abroad.

For small businesses, the best tax free zone and easiest work visa is Panama Pacifico. For more information, see Panama Pacifico’s business page.

  1. Panama’s Reforestation Investor Visa: If you want to go big into teak or other hardwoods, then consider residency in Panama through the Reforestation Investor Visa.

This program requires a minimum investment of $80,000 in a reforestation project certified by the government. It also requires a minimum of five hectares of titled land. This is the best “go green” option for your second residency.

  1. Panama Business Investor Visa: If you’re going to start a business in the country, and you’re not from a “friendly” nation, then I suggest the Panama Business Investor Visa. Setup a corporation with $160,000 of paid-in capital, and you get a temporary residency permit. Operate the business for two years and you will earn permanent residency status.

There are no minimum numbers of employees required for this visa. So, you can be the only employee of your company. However, you should be conducting some type of business. This program is for active businesses, not holding companies or passive investments.

I hope you have found this article on the residency options in Panama to be helpful. Please contact me at or call (619) 550-2743 for a free and confidential consultations.