Property title transfer in Panama: steps and taxes
We guide your property title transfer in Panama and prepare DGI forms 106, 107 and 108. We follow up until registration at the Public Registry.
- Authority
- DGI (tax authority), notary and Public Registry
- How it is filed
- Mixed: forms in e-Tax 2.0; deed and registration in person
- Typical timeframe
- Variable: depends on the DGI review, the notary and the Public Registry
Who it is for
- Sellers of landThe seller files forms 106 and 107 with the DGI.
- Buyers and reforestation groupsYou are buying land and need the title registered in your name.
- Owners who live outside PanamaYou sell or buy without traveling to Panama for every step.
Problems we solve
- The DGI voided a form because of wrong figures.
- The land is not in good standing and the Public Registry will not record the sale.
- The sale fell through and you need to void forms 106 and 107.
- The land has a seizure or a mortgage that blocks the transfer.
Key terms in a Panama land sale
A finca is a parcel of land registered under its own number in the Registro Público (Public Registry). The Public Registry records owners, mortgages and seizures. A transfer is complete only when the new owner is registered there.
The DGI (Dirección General de Ingresos) is Panama's tax authority. Sale taxes are declared in e-Tax 2.0, its online system. A paz y salvo is a certificate showing the land owes no property tax.
The escritura pública is the public deed of sale, signed before a notary. The valor catastral is the land's assessed value in the official cadastre.
Taxes on a property title transfer in Panama
The seller pays two items to the DGI. The real estate transfer tax is declared on Form 106. Capital gains tax is declared on Form 107.
According to the Form 106 instructions, the transfer tax is 2%. It is calculated on the higher of the updated cadastral value and the sale price.
The DGI leaflet on forms 106 and 107 presents two ways to settle capital gains tax: 3% of the higher of the sale price and the cadastral value, or 10% of the gain. If you sell at or below your purchase price, the 3% does not apply.
If a company owns the land: form 108
Many properties in Panama are owned by a corporation. Sometimes the land itself is not transferred: the shares of the company are sold.
In that case DGI form 108 applies. According to the DGI, whoever buys shares or other securities withholds 5% of the total sale value from the seller.
That 5% is an advance on capital gains income tax. The buyer remits it to the Treasury within ten days. We tell you which route applies to your case.
Forest land: exempt from transfer tax
Article 9 of Law 69 of 2017 exempts certain forest land from the transfer tax. The land must be used exclusively for commercial forest plantations, or to conserve natural forest on more than 75% of its suitable area.
The exemption depends on a Forest Management Plan approved within the first year after purchase. Review it before you sign.
Property tax clearance: no registration without it
The DGI requires the land's paz y salvo to transfer real estate. An endorsed (refrendado) paz y salvo is not valid for transfers.
The Public Registry does not record acts on real estate without proof that the land is in good standing with the Treasury. Article 792 of the Fiscal Code sets this rule.
Requirements
- Seller registered with the DGI, with a NIT to use e-Tax 2.0. Official source
- Form 106 (real estate transfer) and Form 107 (capital gains). Official source
- Receipt certificates (Form 80) for both forms, paid and reconciled. Official source
- Property tax paz y salvo for the land. The endorsed version is not valid for transfers. Official source
- Public deed signed before a notary. Official source
- Land free of a recorded seizure or attachment, which takes it out of commerce. Official source
Steps and timeframes
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We review the land
We handle itWe check owner, liens, cadastral value and good standing.
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We prepare forms 107 and 106
We handle itWe prepare them in e-Tax 2.0 with the seller's RUC and NIT and take them to DGI review before payment.
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You pay the taxes
You handle itPayment is made at DGI cashiers or at collecting banks. The DGI asks for payment within the same month as the return.
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We reconcile and print Form 80
We handle itWe reconcile tax code 120 with Form 106 and code 113 with Form 107. Then we print the receipt certificates.
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We obtain the property tax paz y salvo
We handle itWe request it from the DGI so it can be attached to the deed.
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Deed at the notary
You handle itWe coordinate the signing of the deed of sale with the parties or their attorneys-in-fact.
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Registration at the Public Registry
The authority handles itThe Public Registry reviews and records the deed. We follow up.
Variable
Costs
| Item | Amount |
|---|---|
| Transfer tax (Form 106) Official source | 2% of the higher of updated cadastral value and sale price |
| Capital gains tax (Form 107) Official source | 3% of the higher of sale price and cadastral value, or 10% of the gain |
| Notary and Public Registry recording fees | According to current fees |
| Tramita Todo fee | We will quote you |
We calculate the taxes with you before payment. We confirm notary and registry fees when we review your case.
What our service includes
- Prior review of the land and its liens.
- Preparing forms 106 and 107, and form 108 if shares are sold, with their review at the DGI.
- Payment reconciliation and receipt certificates.
- Property tax paz y salvo.
- Coordination with the notary and follow-up at the Public Registry.
What it does not include
- Payment of the sale taxes.
- Drafting special contracts (quoted separately by our legal team).
- Lifting seizures or mortgages, which is a separate procedure.
Who handles your case
- Handling procedures before Panamanian authorities since 2008.
- Certified public accountants on our team.
- Our own office in Obarrio, Panama City.
- We also serve clients who live outside Panama.
Frequently asked questions
Who pays the taxes on a land transfer?
According to the DGI, the seller files Form 106 (transfer) and Form 107 (capital gains) and must be registered as a taxpayer. We review the figures with you before filing. That helps avoid the DGI voiding a form because of incorrect amounts.
Do I pay 3% or 10% capital gains tax?
They are two different methods, not added together. The DGI leaflet presents 3% of the higher of the sale price and the cadastral value, and 10% of the gain. We review your case before Form 107 is filed so you know the figures in advance.
What is form 108?
It is the sworn return for the 5% withholding when shares or other securities are sold, for example the shares of a company that owns land. The buyer files it within ten days. We prepare it with you.
Does reforestation land pay the 2% transfer tax?
Under Law 69 of 2017, it can be exempt. The land must be used exclusively for commercial forest plantation, or to conserve natural forest on more than 75% of its suitable area. It must also meet its Forest Management Plan. If it does not, the DGI revokes the exemption and collects the tax.
Can I sell or buy land from abroad?
Many of our clients own land in Panama and live elsewhere. We prepare the DGI forms, obtain the paz y salvo and follow the Public Registry filing. We tell you which documents you need and keep you updated in writing by WhatsApp or email.
What if the sale does not go through?
The DGI publishes instructions to void forms 106 and 107 when a sale is not completed. We help you request the cancellation so no obligations remain in your name. To start, we need the form numbers and the payment receipts, if any.
Can I sell land that has been seized?
According to the Public Registry's review manual, a recorded seizure or attachment takes the land out of commerce and blocks registration. The debt or the measure must be resolved first. If the debt is with the DGI, we explain your payment or payment plan options.
Related procedures
Property tax exemption for farm and reforestation land in Panama
Farm and reforestation land: certification, DGI filing and renewal of the exemption.
Learn moreProperty tax seizure by the DGI in Panama: what to do and how to lift it
Enforced collection, payment plans and lifting the DGI seizure of your land at the Public Registry.
Learn more