Countries › Panama › Guide › 11. Real estate and land › Real estate transfer tax in Panama: 2 percent paid by the seller, and the 2026 relief for the first sale of new homes

Real estate transfer tax in Panama: 2 percent paid by the seller, and the 2026 relief for the first sale of new homes

Last verified: 2026-10-29 · Status: Changing

Every transfer of real estate for value in Panama bears a 2 percent transfer tax on the higher of the price and the cadastral value, paid by the transferor before the deed is signed. Inheritances, donations and sales by the State are outside the tax. Since Ley 546 de 2026, the first sale of a new home within two years of the occupancy permit is exempt on the first B/.120,000, with a reduced scale up to B/.200,000, and clauses shifting the tax to the buyer are void.

Panama's currency, the balboa (B/.), is at par with the US dollar, which circulates as legal tender; the Superintendencia de Bancos states that the balboa's value is on a par with the US dollar (checked 29 October 2026). USD figures therefore equal the balboa figures.

Key facts

Real estate transfer tax (general)	2 %Ley 106 de 1974 art. 1, as of 2026-10-29 · in force
Transfer tax exempt amount on the first sale of a new home	120000 PABLey 106 de 1974 art. 4 (Ley 546 de 2026), as of 2026-10-29 · in force
Upper limit of the preferential new home transfer tax scale	200000 PABLey 106 de 1974 art. 4 (Ley 546 de 2026), as of 2026-10-29 · in force
Exchange rate used for USD conversions	1 PAB per USDBalboa at par with the US dollar (Superintendencia de Bancos), as of 2026-10-29 · in force

The rule

1. A 2 percent tax applies to transfers of real estate for value, whether by sale, exchange, payment in kind or any other agreement transferring ownership. It applies to the transfer value with the current cadastral value as a minimum, is paid by the transferor in cash to the Treasury at the time of transfer, and the deed must record the payment receipt; a notary may not authorise the deed without it.
Cost to do it: 2 percent of the higher of price and cadastral value.
Example: Sale at B/.250,000, cadastral value B/.180,000: B/.5,000. / US$250,000 sale, US$5,000.Ley 106 de 1974, art. 1, 1974-12-30 official text · verified 2026-10-29

2. Inheritances, donations, expropriations and purchases and sales made by the State do not bear the tax. A co owner who acquires further shares of a commonly held property by an inter vivos act other than donation pays the tax on the part acquired.Ley 106 de 1974, art. 2, 1974-12-30 official text · verified 2026-10-29

3. The first sale of a new home is exempt from transfer tax on the first B/.120,000 of the taxable base if formalised within two years after the occupancy permit. If the base is above B/.120,000 and up to B/.200,000, only the excess over B/.120,000 is taxed at 0.50 percent (base up to B/.130,000), 1.00 percent (up to B/.150,000), 1.40 percent (up to B/.170,000), 1.60 percent (up to B/.190,000) or 1.80 percent (up to B/.200,000). Above B/.200,000 the first B/.120,000 stays exempt and the excess pays the general regime. Any clause making the buyer pay or reimburse the seller's transfer tax is void.
Cost to do it: New home at B/.160,000: 1.40 percent on B/.40,000.
Example: New home at B/.160,000: B/.560; at B/.250,000: 2 percent on B/.130,000, B/.2,600. / US$160,000 new home, US$560; US$250,000 new home, US$2,600.Ley 106 de 1974 art. 4 as worded by Ley 546 de 2026 art. 1, art. 4, 2026-08-31 official text · verified 2026-10-29 · changed: Ley 546 de 31 de agosto de 2026, in force the day after promulgation, replaced the former exemption for new homes bought for the buyer's own use with a B/.120,000 exemption, a preferential scale up to B/.200,000 and a ban on shifting the tax to the buyer.

4. To use the exemption the seller declares under oath in the deed that the home is new, that this is its first sale and that it is formalised within two years of the occupancy permit, whose date and details must appear in the deed; no DGI exclusion certificate is needed, but the use of the exemption must be reported to the DGI and false declarations trigger the unpaid tax, surcharges, interest and sanctions. As a transitional rule, first sales formalised after the law took effect may use the benefit within thirty months of an occupancy permit issued earlier.Ley 106 de 1974 art. 4 as worded by Ley 546 de 2026 art. 1; Ley 546 de 2026 art. 2 (transitory), art. 4; art. 2, 2026-08-31 official text · verified 2026-10-29

5. When a developer pays income tax under the new home and new commercial premises scale, the transfer tax exoneration is treated as used up on that first registration of title and cannot be claimed again on a later transfer of the same property.Código Fiscal art. 701 literal a as worded by Ley 28 de 2012 art. 2, art. 701 literal a, 2012-05-08 official text · verified 2026-10-29

6. Transfers to third parties of land titled free of charge under the coastal and island titling law bear the transfer tax and other taxes under the Código Fiscal.Ley 80 de 2009, art. 6, 2009-12-31 official text · verified 2026-10-29

Taxable base (B/.)	Treatment	Tax at the top of the band (B/.)
Up to 120,000	Exempt	0
120,000 to 130,000	0.50 percent on the excess over 120,000	50
130,000 to 150,000	1.00 percent on the excess over 120,000	300
150,000 to 170,000	1.40 percent on the excess over 120,000	700
170,000 to 190,000	1.60 percent on the excess over 120,000	1,120
190,000 to 200,000	1.80 percent on the excess over 120,000	1,440
Above 200,000	First 120,000 exempt, general regime on the excess	2 percent of the excess

Transfer tax on the first sale of a new home under Ley 106 de 1974 art. 4 as worded by Ley 546 de 2026.

Worked example

A developer sells a new apartment for B/.160,000 (US$160,000) one year after the occupancy permit: the first B/.120,000 is exempt and B/.40,000 is taxed at 1.40 percent, B/.560 (US$560).
The same developer sells a B/.250,000 unit: B/.120,000 is exempt and B/.130,000 pays the general 2 percent, B/.2,600.
A private owner reselling a house for B/.250,000 with a cadastral value of B/.180,000 pays 2 percent of B/.250,000, B/.5,000.

Step by step

Compare the price with the current cadastral value; the higher figure is the base.
Have the seller file DGI form 106 and pay before signing the deed.
For a new home, include the sworn statement and occupancy permit details in the deed and report the exemption to the DGI.
Make sure the payment receipt details are written into the deed so the notary can authorise it and the registry can record it.

Common traps

The base never falls below the cadastral value, even if the agreed price is lower.
The new home relief applies only to the first sale and only within two years of the occupancy permit (thirty months for permits issued before Ley 546 de 2026).
Clauses making the buyer of a new home pay the seller's transfer tax are void.
A false new home declaration in the deed exposes the seller to the unpaid tax plus surcharges, interest and penalties.

Sources

← Property tax in Panama (impuesto de inmuebles): 0.6 to 1 percent on investment property, up to 0.7 percent on a registered home, exemptions and payment datesSelling property in Panama: 10 percent tax on the gain, the 3 percent advance that can be final, and the scale for developers →

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