Work permits and visas in Panama: An employer’s guide

Hiring in Panama? Whether you’re bringing on a new team member or relocating someone from your existing workforce, you’ll need to follow the country’s immigration and work permit rules.

Understanding which type of work permit applies is key, since every worker needs the right documentation before they can legally work in Panama. Add in local laws around immigration, tax, and employment, and things can get complicated quickly.

That’s why we’ve put together this guide. Here, you’ll find a comprehensive breakdown of work permits in Panama, from the different options available to practical tips. So let’s jump straight in.

Why is it important to obtain the right work visa in Panama?

If you’re hiring or relocating employees in Panama, it’s important to stay compliant with the country’s immigration and work permit rules. Failing to do so can expose your business to financial penalties, legal risks, and even reputational damage.

To avoid complications, it's crucial to make sure that every team member has the right legal status to live and work in the country before they start, and that you seek professional advice where necessary.

See also: The complete employer’s guide to hiring in Panama

Who needs a work visa in Panama?

All foreign nationals (i.e., anyone who is not a Panamanian citizen or permanent resident) must obtain a valid work visa to work in Panama.

Remote’s Relocation service can help advise on whether your employee is eligible to work in Panama, and provide tailored guidance on visa and immigration requirements. Learn more.

What types of work visas are available in Panama?

For foreign workers, Panama offers several types of work permits, as follows:

Friendly Nations Visa

The Friendly Nations Visa (or “Permanent Residence Permit for Citizens of Nations with Friendly, Commercial, and Professional Relations with Panama”) is one of the country’s most employer-friendly pathways for hiring foreign talent.

However, as the name suggests, it only applies to citizens of certain countries designated by the Panamanian government. Luckily, this list is extensive (and also prone to change), and currently includes the US, Canada, the UK, Mexico, Brazil, and many EU member states.

For qualifying candidates, it creates a streamlined process to obtain permanent residence along with eligibility for a work permit. This makes it a particularly attractive option for long-term hires, as it reduces the administrative burden of renewals and provides employees with greater stability in the country.

The Friendly Nations Visa is also valuable because it removes much of the uncertainty around retaining foreign employees over multiple years. Once granted, the work permit can be tied to a local employment contract, allowing professionals to legally reside and work in Panama almost indefinitely. For roles where retention and stability matter (such as senior specialists or leadership hires), the Friendly Nations Visa provides one of the most sustainable solutions available.

Professional Foreigner Visa

The Professional Foreigner Visa (or “Permanent Residence Provisional Permit for Foreign Professionals” (PPT-PROF)) is designed for highly qualified professionals who hold recognized academic or professional degrees. It’s suitable for employees who will work in Panama under a standard employment contract, provided their profession is not restricted to Panamanian nationals. The permit typically runs for two years, with the option to renew if the employment relationship continues.

Note that the application process requires validation of the employee’s credentials, including degree recognition by a Panamanian university or professional body where applicable. This makes it more suitable for mid- to senior-level hires whose roles justify the investment of time and resources in the application.

If your company is seeking to fill specialized positions with international talent, the Professional Foreigner Visa ensures legal compliance while providing a stable foundation for long-term employment relationships.

Short-term work permit

Panama offers several short-term work permits, enabling companies to bring in foreign workers for specific projects, assignments, or seasonal needs. Usually valid for up to six months, these permits are ideal for situations where expertise is required for a limited time but does not justify a longer-term residence and work authorization.

For employers, the advantage of these permits is flexibility. They allow businesses to deploy specialized talent quickly without committing to longer-term sponsorship or navigating more complex visa routes. That said, their short duration means they are best used as a solution for targeted projects rather than ongoing operational needs. 

Multinational Headquarters Company Visa

The Multinational Headquarters Company (SEM) visa is designed for foreign nationals who are being transferred from a foreign office of your company to a branch or subsidiary in Panama.

It enables you to transfer managers, specialists, or other key personnel without navigating the restrictions placed on general work permits, and follows a relatively straightforward process. The SEM visa is a strategic tool for maintaining global consistency across teams, supporting leadership continuity, and accelerating the integration of international expertise into local operations.

How to obtain a work permit in Panama

The exact visa application process can vary by stream, but generally, you and your employee will need to do the following:

1. Ensure the correct residency status

Before any work permit application, you must ensure your employee is applying for the appropriate residency visa (e.g., the Friendly Nations program, Professional Foreigner Visa, or another eligible route) with the National Immigration Service (Servicio Nacional de Migración).

Only then with the valid temporary or permanent residency can the employer proceed with a work permit application to the Ministry of Labor (MITRADEL). 

2. Prepare employer sponsorship and documentation

As the employer, your company is responsible for initiating the work permit process. You’ll need to gather:

• The completed visa application forms.
• A signed employment contract.
• A formal letter of responsibility.
• Confirmation that hiring a foreigner aligns with the 10% foreign workforce cap (unless exceptions apply).
• Any required educational or professional credential verification.
• Payment of the application fee (and any associated government fees).

The application can then be submitted through the National Immigration service (note that your employee may also need to register biometric data (like fingerprints) at the Ministry of Labor). From there, the application undergoes official review and validation.

Note that the application processing time can be between one and three months.

3. Obtain the permit

If the application for temporary or permanent residency is approved, your employee receives a work permit card (carné laboral), which is the formal authorization to work in Panama. At this stage, you’re fully compliant, and your employee can begin their role legally.

Does Panama offer a digital nomad visa?

Yes. Panama does offer a dedicated digital nomad visa, known officially as the Short-Stay Visa for Remote Workers. It enables remote workers of foreign companies to live and work remotely in Panama without the need for a local employer or sponsorship.

The visa is valid for an initial nine-month stay, with the option to extend for another nine, giving your employee a total potential stay of up to 18 months in Panama.

To be eligible, applicants typically must:

• Not earn any income from a Panamanian company or client.
• Earn a minimum income of $3,000 per month.
• Possess valid health insurance, a clean criminal record, and supporting documents like passport, a remote work contract (or proof of freelance work), and bank statements.

See also: Which other countries offer digital nomad visas?

How can Remote help?

To hire or relocate employees to Panama, you’ll need to have your own local entity there. This is a process that can be complex, lengthy, and expensive, and requires an in-depth understanding of Panamanian law.

You also need to comply with relevant immigration laws and regulations to avoid potential penalties, as well as handle payroll, benefits, and all other HR requirements.

This is where Remote’s employer of record (EOR) service can be invaluable. We act as the legal employer in Panama on your company’s behalf, and handle onboarding, payroll, and benefits. We help ensure that you are fully compliant with all local employment and payroll tax laws, and can onboard your employee in a matter of days, too, saving you time, money, and resources.

Alternatively, if you already have an entity in Panama, we can assist in international employee relocation with case-by-case immigration assessments, and guidance on the visa process.

To learn more about the processes involved in relocating international employees, download Remote's Relocation Guide, or contact our Relocation team today.