The Family Tributary Patrimony refers to the real estate destined for permanent use by the owner for housing purposes together with his family, who lives under the same roof.
On the other hand, the Main Residence, is the real estate dedicated to the use for permanent housing purposes by the owner as a natural person which does not constitute family patrimony.
In Panama, Law 66 of 2017 and the reforms made by President Varela in 2018 dictate the procedures and requirements for the registration of a residence as family patrimony or main residence, and request payment exemption, exceptions, or a lower tax rate of real estate taxes.
The tax reform establishes the following tax benefits:
- Exemption from payment of real estate tax for real estate with taxable value not exceeding USD $120,000.
- Tax exemption for real estate with a cadastral value between USD $120,000 and USD $300,000 for a period of 3 years if the property is a first home purchase.
Considerations
- The tax benefit applies to real estate for permanent housing purposes and not to those considered commercial.
- The Tax Identification Number (NIT) of the applicant and the real estate is required to file the application.
- Non-housing properties benefit from lower rates.
- The cadastral value of the property does not need to be updated when filing the application.
To read Law 66 and Decrees 362 and 363, click here:
Law 66
of
2017
Decree 362
of
2018
Decree 363
of
2018
