Panama Net Salary Calculator 2026
Last updated: January 2026
Net salary in Panama for 2026 is calculated by deducting CSS, educational insurance, and ISR from gross salary, in US dollars (balboa = 1 USD). Employee deductions: CSS 9.75% + educational insurance 1.25% = 11% total. ISR uses brackets of 15% ($11,001-$50,000) and 25% (over $50,000) annually. The employer contributes CSS 12.25% + educational insurance 1.5% + workplace risk 1.62% = 15.37%. With a gross salary of $2,000/month, deductions are: CSS $195, educational insurance $25, ISR approximately $56, for a net salary of about $1,724. Panama's minimum wage varies by region and economic activity, ranging from $326 to $660/month.
FAQ
How much is deducted for CSS in Panama?
The employee's CSS contribution is 9.75% of salary with no cap. Plus 1.25% educational insurance, totaling 11% in mandatory deductions before ISR. On a $2,000 salary, CSS is $195 and educational insurance is $25.
What is educational insurance in Panama?
Educational insurance (seguro educativo) is a mandatory 1.25% employee deduction (plus 1.5% employer) that funds Panama's public education system. It applies to all salaried workers and is deducted alongside CSS contributions.
What is the minimum wage in Panama 2026?
Panama's minimum wage varies by region and economic activity, ranging from $326/month (agriculture in certain regions) to $660/month (banking in urban areas). There are over 40 different minimum wage rates based on industry and geographic zone.
How is ISR calculated on salary in Panama?
After deducting 11% (CSS + educational insurance), annual taxable income is calculated. The first $11,000 is exempt, $11,001-$50,000 at 15%, over $50,000 at 25%. ISR is withheld monthly by the employer. Year-end reconciliation adjusts any differences.
Does Panama tax the décimo tercer mes?
No. The décimo tercer mes (13th month) is completely exempt from both ISR and CSS deductions. Each of the three installments (April, August, December) is received in full. This is established in Panama's Labor Code.