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Countries › Panama › Guide › 6. Taxes › Panama's double taxation treaties: 17 treaties, the MLI, treaty residence rules and the memorial filed before the payment

Panama's double taxation treaties: 17 treaties, the MLI, treaty residence rules and the memorial filed before the payment

Argentina. For full detail on Argentina, go to The Argentine Thread.

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

The DGI lists 17 double taxation treaties approved by law, with Barbados, Czech Republic, France, Ireland, Israel, Italy, Korea, Luxembourg, Mexico, the Netherlands, Portugal, Qatar, Singapore, Spain, the United Arab Emirates, the United Kingdom and Vietnam, and all but Italy are covered by the OECD Multilateral Instrument. To apply a treaty rate the taxpayer files a substantiated memorial with the DGI ahead of the transaction, within the 30 day window of art. 762-Ñ, proving the recipient's tax residence. Panama has no treaty with Argentina.

Panama's currency, the balboa (B/.), is at par with the US dollar, which circulates freely 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

Double taxation treaties approved and listed by the DGI17 treatiesDGI list of treaties, as of 2026-10-29 · in force
Double taxation treaty with ArgentinaNo textDGI list of treaties, as of 2026-10-29 · in force
Treaty memorial filing window before the transaction (art. 762-Ñ wording: con un máximo de treinta días antes)30 daysCódigo Fiscal art. 762-Ñ, as of 2026-10-29 · in force
Days in Panama making an individual tax resident183 daysCódigo Fiscal art. 762-N, as of 2026-10-29 · in force
Exchange rate used for USD conversions1 PAB per USDBalboa at par with the US dollar (Superintendencia de Bancos), as of 2026-10-29 · in force

The rule

1. The DGI publishes the treaties approved by the National Assembly and their MLI dates: Mexico (Ley 24 de 2010), Barbados (Ley 5 de 2011), Portugal (Ley 7 de 2011), Italy (Ley 50 de 2011), Qatar (Ley 20 de 2011), Luxembourg (Ley 21 de 2011), Spain (Ley 22 de 2011), the Netherlands (Ley 23 de 2011), Singapore (Ley 24 de 2011), Korea (Ley 25 de 2011), France (Ley 78 de 2011), Ireland (Ley 59 de 2012), Czech Republic (Ley 5 de 2013), United Arab Emirates (Ley 13 de 2013), Israel (Ley 14 de 2013), United Kingdom (Ley 83 de 2013) and Vietnam (Ley 3 de 2017). It marks the Italy treaty as not covered by the MLI.DGI list of double taxation treaties, Listado de Convenios, 2026-10-29 official text · verified 2026-10-29
2. Panama adopted the Multilateral Convention to Implement Tax Treaty Related Measures by Ley 170 de 2020, and the DGI ordered publication of the synthesized texts of the MLI and of the covered treaties by Resolución 201-1497 of 10 February 2026; the MLI's withholding effects apply from 1 January 2022 for most covered treaties, 1 January 2023 for Spain, 1 January 2024 for Mexico and Vietnam and 1 January 2025 for the Czech Republic and Singapore.DGI Resolución 201-1497 de 10 de febrero de 2026 (Gaceta Oficial 30493-C), Resolución 201-1497, 2026-02-10 official text · verified 2026-10-29
3. Treaty benefits must be supported by a memorial filed with the DGI, grounded in law and with the evidence the treaty requires; the law says it must be filed con un máximo de treinta (30) días antes of the transaction; this does not excuse the sworn return documenting the operation. Benefits apply only if the recipient proves tax residence in the treaty country, with foreign certificates legalized and officially translated. Improper use costs the whole benefit for the period, plus the penalties of art. 752.
Cost to do it: No government fee for the memorial; residence certificates from the foreign authority, legalization and official translation are needed.Código Fiscal art. 762-Ñ as worded by Ley 52 de 2012 art. 14, art. 762-Ñ, 2012-08-28 official text · verified 2026-10-29
4. Individuals are Panamanian tax residents if they stay more than 183 days, continuous or not, in a fiscal year or the previous year, or establish their permanent home in Panama. Companies incorporated in Panama are resident if they have material means of direction and management in Panama, and foreign companies are resident if they have such means in Panama and are registered in the Registro Público.Código Fiscal art. 762-N as worded by Ley 52 de 2012 art. 13, art. 762-N, 2012-08-28 official text · verified 2026-10-29
5. Where a treaty applies to dividends, its regime prevails over the domestic 10 and 5 percent rates (art. 733 literal e).Código Fiscal art. 733 literal e as worded by Ley 8 de 2010 art. 36, art. 733 literal e, 2010-03-15 official text · verified 2026-10-29
CountryApproving lawMLI in forceMLI effect on withholding
BarbadosLey 5 de 20111 Apr 20211 Jan 2022
KoreaLey 25 de 20111 Sep 20201 Jan 2022
United Arab EmiratesLey 13 de 20131 Sep 20191 Jan 2022
IrelandLey 59 de 20121 May 20191 Jan 2022
IsraelLey 14 de 20131 Jan 20191 Jan 2022
ItalyLey 50 de 2011Not coveredNot covered
LuxembourgLey 21 de 20111 Aug 20191 Jan 2022
NetherlandsLey 23 de 20111 Jul 20191 Jan 2022
PortugalLey 7 de 20111 Jun 20201 Jan 2022
QatarLey 20 de 20111 Apr 20201 Jan 2022
United KingdomLey 83 de 20131 Oct 20181 Jan 2022
Czech RepublicLey 5 de 20131 Sep 20201 Jan 2025
SingaporeLey 24 de 20111 Apr 20191 Jan 2025
SpainLey 22 de 20111 Jan 20221 Jan 2023
FranceLey 78 de 20111 Jan 20191 Jan 2022
MexicoLey 24 de 20101 Jul 20231 Jan 2024
VietnamLey 3 de 20171 Sep 20231 Jan 2024

Panama's double taxation treaties and MLI dates as listed by the DGI (checked 29 October 2026).

Worked example

  • A Panamanian S.A. plans to pay a dividend to its Spanish parent on 15 December 2026.
  • It files the memorial with the DGI ahead of the payment, within the 30 day window of art. 762-Ñ, attaching the parent's Spanish tax residence certificate, legalized and translated, and the treaty analysis.
  • Without the memorial it must withhold the domestic 10 percent. An Argentine parent cannot use any treaty, because none exists; the Argentine side of the dividend is covered in the Argentine guide.

Step by step

  1. Confirm the recipient's country is on the DGI list and check the treaty article and any MLI change.
  2. Obtain a current tax residence certificate, legalized and officially translated.
  3. File the memorial with the DGI ahead of the payment, respecting the 30 day window of art. 762-Ñ; confirm the DGI practice on timing with an adviser.
  4. Withhold at the treaty rate and file the sworn return documenting the operation.
  5. Keep evidence of beneficial ownership and substance of the recipient.

Common traps

  • Filing the memorial late can mean withholding the domestic rate.
  • MLI changes, such as the principal purpose test, apply to every covered treaty except Italy's.
  • Panamanian companies need material means of direction and management in Panama to obtain a Panamanian residence certificate.
  • Argentina, the United States and Colombia are not on the DGI treaty list.

Sources

Related pages

Related: Panama country profile · live dashboard · central bank and release calendar · our posts on X · where Argentina is involved, see The Argentine Thread guide

← Tax loss carryforward in Panama: five years, 20 percent of the loss per year, capped at 50 percent of taxable incomeOther business taxes in Panama: the Aviso de Operación tax of 2 percent of capital, property tax schedules, real estate transfer tax and monthly stamp tax returns →

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