Panama Property Tax 2026: Rates and the 20-Year Exemption

You have found a new apartment you like, the developer has quoted you a price, and the question underneath it is what this thing costs to hold every year. Panama's answer is short and it is good news for most buyers who plan to live in the home: the annual impuesto de inmueble, the property tax, starts at zero on the first slice of value, and the slice is four times larger for an owner-occupier than for anyone else. On top of that, a first home in a particular price window still gets three fully exempt years under article 766 of the Fiscal Code. This page gives you both schedules, that exemption, the filing you have to do to get either one, and the history behind the numbers so nothing on a sales sheet catches you out.

Key takeaways

• Declare the home as your Vivienda Principal or Patrimonio Familiar Tributario and the first B/.120,000 of assessed value is taxed at zero, then 0.5% to B/.700,000 and 0.7% above that. DGI, checked August 2026.
• A rental or second home starts paying at B/.30,000: 0.6% to B/.250,000, 0.8% to B/.500,000, 1% above. Same source.
• A first home purchase assessed between B/.120,000 and B/.300,000 gets three exempt years under article 766 of the Fiscal Code as rewritten by Ley 66 de 2017, counted from the occupancy permit date or the Registro Público inscription date, whichever comes first.
• Nothing applies automatically. You file Formulario 226 through DGI's e-Tax 2.0 portal, and DGI counts the exemption from the day you file, not the day you bought.
• The old 20-year exemption on new construction ended with building permits issued from January 1, 2019. Permits issued before that date keep whatever years remain on the original grant.
• The first sale of a new home has paid the 2% transfer tax since January 2026, and a bill approved by the Consejo de Gabinete on July 29, 2026 would change that again.

The two schedules, side by side

Since Ley 66 de 2017 took effect, property tax runs on two schedules, and which one you land on depends on how the home is used and declared rather than on when the building was permitted.

Both schedules are permanent. They are not exemptions with an expiry date attached, so what you read in this table is what the home pays for as long as you hold it under that use. The gap between the two columns is the single biggest annual number in the buy-to-live versus buy-to-rent decision, and our guide to the taxes that actually apply to an investment property works that gap through on a B/.300,000 unit.

The three exempt years a first home still gets

Ley 66 kept one benefit for buyers of new homes, and it sits in article 766 of the Fiscal Code. A property bought as a first home purchase and constituted as Patrimonio Familiar Tributario or Vivienda Principal pays no property tax for three years, provided its cadastral value falls between B/.120,000 and B/.300,000. The three years run from the date the occupancy permit was issued or the date the property was recorded at the Registro Público, whichever comes first. Ley 66 was published in Gaceta Oficial No. 28388-C on October 17, 2017.

The conditions do real work, so it is worth knowing early whether your unit is inside them:

• It has to be a first home purchase, and it has to be registered under one of the two owner-occupier regimes, which means you live in it.
• Below B/.120,000 the exemption adds nothing, because the owner-occupier schedule already taxes that first slice at zero. You are covered either way.
• Above B/.300,000 it does not apply. That covers a good share of the new construction marketed to foreign buyers in Panama City, so if your shortlist sits there, plan on the owner-occupier schedule from year one and treat that as the real number.
• A rental unit or a second home is outside it. If the plan is to let the unit, the investment-property guide linked above is the page that fits your case.

Filing is on you, and the date matters

DGI does not apply any of this on its own. Its published FAQ says of the zero-rated first B/.120,000: "Estas viviendas no pagarán impuesto de inmueble, pero deben solicitar la exoneración para que sea aplicada y cubre a partir del día que se solicita." It covers you from the day you ask. A buyer who takes possession in January and files in November has owed tax for those ten months, which makes this one of the cheapest pieces of admin in the whole purchase to get right and one of the more expensive to postpone.

The request goes through DGI's e-Tax 2.0 portal as Formulario 226. DGI's instructivo is explicit that the property's values and its construction and occupancy permit dates must be updated at ANATI first. With no occupancy permit date on file, the system will not accept the request at all, which is the usual reason a filing stalls on a brand-new building.

What DGI asks you to attach:

• a copy of the owner's cédula, the national ID card
• a copy of the escritura recording the declaration of improvements and the sale
• copies of the construction and the occupancy permits

Buying through a Panamanian company does not push the home onto the higher schedule by itself. DGI confirms that Patrimonio Familiar Tributario has a category for fincas, registered land parcels, held in the name of a sociedad anónima.

Once the property is on a schedule, the tax is payable in three cuatrimestres, four-month instalments due April 30, August 31 and December 31. Pay the full year before April 30 and DGI discounts the bill 10%, provided the account carries no arrears. Checked August 2026.

Why you will still see "20-year exemption" on old sales material

The number has a real history behind it. Ley 28 de 2012 gave new construction a tiered exemption on the improvement value, the built part of the property as opposed to the land: 20 years for units valued up to B/.120,000, 10 years for B/.120,001 to B/.300,000, and 5 years above that, for building permits issued from 2012 through December 31, 2018.

Ley 66 de 2017 closed it. For any building permit issued on or after January 1, 2019 there is no automatic improvement exemption, and the two schedules above took its place. Properties permitted before that date keep whatever years remain on their original grant, which DGI recognises as grandfathered, so a building finished in 2019 or 2020 on a 2018 permit may well still be inside its exemption today. That is why the phrase survives in listings for resale units.

The transitional wording is article 18 of Ley 66: "Se reconocerán las exoneraciones vigentes al 31 de diciembre de 2018 de las mejoras derivadas de los proyectos, cuyo permiso de construcción haya sido expedido antes del 1 de enero de 2019." We quote that from two independent reproductions of the statute, a legal database and a 2018 accounting-firm bulletin, which agree word for word; the Gaceta Oficial and Ministry of Finance copies are scanned images our tools cannot extract text from.

So when a developer or a listing offers you a 20-year exemption, there is one question that settles it: what is the building permit date? A permit from 2019 or later carries no improvement exemption under current law. A permit from before January 1, 2019 may carry a real one, and your attorney can confirm the remaining years against the property's own exemption record at DGI rather than against a sales sheet.

The transfer tax, which changed more recently

If someone tells you a tax break on new homes disappeared recently, they are usually describing the transfer tax rather than the improvement exemption. Article 13 of Ley 468 de 2025, published in Gaceta Oficial Digital No. 30264-A on April 24, 2025, repealed article 4 of Ley 106 de 1974. That was the provision exempting the first sale of a new home from the 2% Impuesto de Transferencia de Bienes Inmuebles, the transfer tax the seller files.

The repeal took effect on April 25, 2025, with a narrow transitional carve-out for homes up to B/.120,000 financed under Ley 3 de 1985 preferential-interest mortgages and bought before December 31, 2025. Since January 2026 the first sale of a new home has been taxed like any other sale. Our buying process guide covers who files what at closing.

That may not be where it settles. On July 29, 2026 the Consejo de Gabinete approved a bill that would exempt the first B/.120,000 of a new home's sale value from the transfer tax where the sale closes within two years of the occupancy permit, then apply a graduated rate to the portion above it, running from 0.50% on homes up to B/.130,000 to 1.80% on homes up to B/.200,000. The Ministerio de Economía y Finanzas published the bands itself. The bill also makes the seller liable and voids any agreement passing the cost to the buyer. It went to the Asamblea Nacional and had not been debated as of early August 2026, so treat it as a possible improvement to a new-build deal rather than something to price in.

What to do with this before you sign

1. Ask for the building permit date on any unit sold with an exemption claim, and have your attorney verify the remaining years directly with DGI.
2. Check where the cadastral value falls. Between B/.120,000 and B/.300,000, and you plan to live there as a first home purchase, the three-year exemption is on the table.
3. Decide who files Formulario 226, and put it in writing. Some developers and closing attorneys handle it, plenty do not.
4. Get ANATI updated first, including the occupancy permit date, or the filing will not go through.
5. File at closing rather than at year end, because DGI counts from the filing date.
6. Pay the full year before April 30 for the 10% discount, once the account is clean.

Your next step

Every number above is a schedule; what you actually want to know is what your unit pays. Send us the building, the price, and whether you intend to live in it or let it, along with your timeline, and we will come back with the schedule that applies, whether the three-year exemption is in reach, and what the filing sequence looks like on that specific purchase. If you are still choosing between projects, tell us your budget and we will include what the annual carrying cost looks like on each. The form below is the whole ask, and it costs nothing.

Frequently asked questions