What are Panamas Social Security Tax Rates?
The social security payable rates in Panama are all based on the employee salary as follows: Social Security Employee: 7.25% Social Security Employer: 10.75% Educational Security Employee: 1.25% Educational Security Employer: 1.50% Professional Risk Security Employer: 2.10% (This varies depending on the business activity) Employee Income Tax: To be withheld by employer and paid to the government according to the salary tax table. It is also important to know that the law in Panama allows employees to receive a bonus by law called the “XIII Month” which is the salary split by 3 payments due on April, august and December; this is only subject to social security 7.25% employee and 10.75% employer on each of the 3 payments. Now, that is what the law stated until it changed by law 51 of December 27, 2005 which modifies the organic law of the Social Security in Panama. It makes progressive the rates applied by the Social Security to both employees and employers as follows: 1. The amount to b
