Palau Friendly Nations Visa

The Friendly Nations Visa program for digital nomads in Panama is a residency initiative designed to attract foreign nationals from specific countries that maintain friendly, professional, economic, and investment relationships with Panama. Officially known as the "Permanent Residence for Nationals of Specific Countries" (often referred to as Friendly Nations Visa), it started back in 2012. To be eligible for the program, individuals must be citizens of one of the 50+ countries listed by the Panamanian government. The list includes nations such as the United States, Canada, many European countries, Australia, and others. Applicants are required to demonstrate economic ties to Panama, which can be fulfilled through various means such as starting a business, buying real estate, or holding a job in the country. In May 2021, Panama introduced some modifications to the Friendly Nations Visa, shifting from offering immediate permanent residency to a two-step process where applicants first receive a temporary residence permit, and then after two years may apply for permanent residency. For digital nomads, Panama introduced a Short Stay Visa for Remote Workers (also referred to as Digital Nomad Visa) which allows eligible remote workers and digital entrepreneurs to live in Panama for a period of up to 18 months. To qualify, applicants must provide proof of steady income from a remote job, have health insurance coverage, and meet certain income requirements.

Who can be eligible for the Panama Friendly Nations Visa programm for digital nomads?

The Panama Friendly Nations Visa extends eligibility to individuals from a select group of countries that are considered to have friendly relations with Panama. While the visa initially targeted a broader range of activities, recent changes have focused it more on attracting remote workers, including digital nomads, business owners, and entrepreneurs. To be eligible for the Panama Friendly Nations Visa as a digital nomad or remote worker, applicants typically need to meet certain criteria:

• **Nationality**: Must be a citizen of one of the countries on Panama's "friendly nations" list.
• **Employment Status**: Must be either employed by a foreign corporation and work remotely from Panama, or be self-employed and conducting work for clients outside of Panama.
• **Income**: Must provide proof of a stable income that is sufficient to cover living expenses while in Panama.
• **Health Insurance**: Must have health insurance that covers them in Panama.
• **Residency Requirement**: Should be willing to reside in Panama; there might be a minimal physical presence requirement.

For business owners or entrepreneurs:

• **Investment**: Must make an investment in Panama, which could be in real estate or in a Panamanian business or corporation.
• **Business Plan**: If starting a business, may need to provide a business plan and evidence of economic activity or intent to do business in Panama.

Due to the potential for changes in immigration policy and visa requirements, it's always recommended to check with the nearest Panamanian consulate or an immigration attorney for the most current information before making any decisions or applications.

Benefits of Working as a Digital Nomad in Panama

• Favorable Visa Options: Panama offers a range of visa options that can be attractive for digital nomads, including the Friendly Nations Visa, which allows citizens from a list of eligible countries to easily obtain residency if they meet certain economic or professional criteria.
• Cosmopolitan Lifestyle: Panama City, the country's capital, offers a vibrant lifestyle with a rich cultural scene, modern infrastructure, and a variety of entertainment options that cater to diverse international tastes.
• Geographical Gateway: Panama's location as a connecting point between North and South America makes it an excellent base for travelers. The country's well-connected international airport allows for easy travel to various destinations across the Americas and beyond.
• Internet Infrastructure: With good internet connectivity in urban areas and efforts to expand services throughout the country, Panama supports the online activities that are essential for digital nomads.
• Tax Advantages: Foreign income is not taxed in Panama, which can be highly beneficial for digital nomads who earn their income from clients or businesses based outside the country.
• Affordable Cost of Living: Panama offers a relatively low cost of living compared to many Western countries, particularly when it comes to housing, local produce, and services.
• Tropical Climate: For those who enjoy warm weather, Panama offers a tropical climate year-round, with beautiful beaches, lush rainforests, and a rich biodiversity to explore during downtime.
• Cultural Diversity: The country’s diverse population results in a melting pot of cultures, providing an enriching experience and exposure to a mix of traditions and customs.
• Business Opportunities: Due to its strategic location and economic stability, Panama is also a great place for networking and potentially expanding your business within the Latin American market.
• Use of US Dollar: Panama uses the US dollar as its currency, which can simplify financial management for those who earn in dollars or come from the United States.
• Friendly Expat Community: The country has a sizable and welcoming expat community, providing an immediate network for newcomers and opportunities for socializing and professional collaboration.
• Healthcare: Panama has a high standard of healthcare, especially in Panama City, with hospitals and clinics that offer services at a fraction of the cost compared to the US, often by English-speaking medical personnel.
• Time Zone Convenience: Panama is in the Eastern Standard Time zone and does not observe daylight saving time, which can be beneficial when coordinating with clients and colleagues in North and South American time zones.

How much does the Panama Digital Nomad Visa Cost?

The visa application fee is 5000 EUR. Visa fee is non-refundable.

Processing time for the Digital Nomad Visa in Panama - Friendly Nations Visa

The processing time for the Friendly Nations Visa in Panama can vary due to several factors, such as the volume of applications received, the accuracy of the documentation provided, and changes in the government's processing policies. As processing times can fluctuate, it is always advisable to consult with an immigration attorney or the Panamanian immigration authorities directly for the most current information. Typically, the process could take a few months to complete. From the time of submitting a complete application along with all the required documentation, it could be several weeks to several months before a decision is made. Some applicants may receive their residency within a few months, while for others, it may take longer. Please note that changes in immigration laws, procedures, and administrative workload can lead to variations in processing times. For the most up-to-date and specific information regarding the processing time for the Friendly Nations Visa in Panama, it is best to directly contact Panama's National Immigration Service (Servicio Nacional de Migración de Panamá) or a legal professional specializing in Panamanian immigration law.

How long can I stay in Panama as a Digital Nomad?

Visa on Friendly Nations Visa is valid for 180 days.

Paying taxes as a Digital Nomad in Panama

Digital Nomads in Panama might be subject to various taxes, depending on their residency status, the nature of their work, and where their income is generated. Here's an outline of potential tax responsibilities:

• Income Tax: If you qualify as a tax resident in Panama (typically by spending more than 183 days in the country within a tax year), you might be liable for income tax on your worldwide income. Non-residents are taxed only on their Panamanian-sourced income.
• Social Security Contributions: If you're employed by a Panamanian entity or work as a freelancer with formal business operations in Panama, you may need to make social security contributions.
• ITBMS (VAT): The Impuesto de Transferencia de Bienes Muebles y Servicios (ITBMS) is the Value Added Tax in Panama. If you are providing services within Panama, you might need to charge ITBMS on your invoices and remit this to the Panamanian tax authorities.
• Municipal Taxes: If you establish a business entity in Panama to facilitate your work as a Digital Nomad, you may be liable for municipal taxes based on your business operations' location.
• Capital Gains Tax: If you sell property or assets in Panama, capital gains tax may apply to the profit of the sale.

If you are a foreigner with temporary presence in Panama and do not meet the tax residency criteria, your tax liability in Panama may be limited. As tax laws can be complex and subject to change, it's always recommended to consult with a tax professional who is familiar with both Panamanian tax law and the tax laws of your home country to ensure compliance and to understand the tax treaties that may affect your situation.

Is it possible to apply the Digital Nomad Visa in Panama for themselves as well as for dependents?

Yes, it is possible to apply for the Friendly Nations Visa in Panama not only for the primary applicant but also for dependents. Here are the details regarding the application for dependents under the Friendly Nations Visa program: [UL] [*] **Dependents Included:** The primary applicant can include dependents in their application. Dependents typically include the spouse or common-law partner, children under a certain age (usually under 18 or 25 if they are full-time students), and sometimes parents or siblings, depending on the specifics of the current immigration laws. [*] **Documentation for Dependents:** Each dependent must provide the necessary documentation to support their application. This could include passports, birth certificates, marriage certificates, and proof of economic dependency for older children or additional dependents. [*] **Economic Solvency Requirement:** The primary applicant must demonstrate the ability to financially support their dependents. This might involve showing specific financial requirements or additional funds available to support the family unit. [*] **Health Insurance:** Dependents are generally required to have health insurance coverage that is valid in Panama. [*] **Dependent Application Timing:** Dependents can often be included in the initial application or added at a later date, subject to the regulations in place at the time of application. [*] **Legal Status:** Upon approval, the primary applicant and their dependents will usually obtain the same type of temporary or permanent residency status. [*] **Application Fees:** Additional government fees and legal costs are typically associated with including dependents in the visa application process. These should be accounted for in the overall budget for immigration. [/UL] Please note that immigration laws and visa programs are subject to change, so it's important to consult with a qualified immigration attorney or the relevant Panamanian authorities to obtain the most current information and guidance when applying for the Friendly Nations Visa for both yourself and dependents.