Automate payroll in Panama with Al-powered calculations, local CSS handling, and compliant payslips generated in seconds.
Establish credibility and match buyer objections: compliance, local knowledge, pricing clarity, and support.
Local Compliance Without Local Overhead: Ontop automates Panama tax calculations and Convención Colectiva requirements so you avoid setting up a local entity. The platform handles Décimo Tercer Mes payments, wage floors, and regional tax variation to keep payroll compliant and predictable. Transparent Pricing And Fees: Pricing clearly shows payroll fees, exchange rates, and contractor or EOR plan costs before payment.
Finance teams get predictable statements with no surprise charges. Human Support When It Matters: Live support helps resolve local queries and edge cases. Dedicated onboarding specialists guide tax registration and social security setup so teams move from hire to pay faster. Global Coverage With Panama Expertise: Ontop supports hiring across 150+ countries while providing Panama-specific workflows. Proration for Décimo Tercer Mes, Convención Colectiva compliance, and DGI deadline management. Scale globally while keeping local accuracy.
Provide fast facts: minimum wage, pay frequency, bonuses, regional salary ranges. Satisfies informational intent and helps long-tail SEO.
Minimum Wage And Pay Frequency: Panama's minimum wage is $340 - $700 USD Monthly. With Décimo Tercer Mes, annual total reaches the statutory requirements. Many employers pay 1 month salary in 3 parts or prorate into Bi-weekly payments. Ontop supports both structures.
Average Salary And Net Take Home: National average salary is ~$18000 USD per year, about ~$1500 USD per month gross. Ontop displays gross-to-net breakdowns so payroll and offers align with local expectations.
Regional Variation To Budget For: Salaries run higher in Panama City and David. Panama City averages $1,800 - $2,500 USD (~20% above national). David around $1,200 - $1,800 USD (~0%). Ontop lets you model regional differences in offers and cost projections.
Décimo Tercer Mes: Panama commonly provides 1 month salary in 3 parts. Payroll logic captures proration rules so payslips match local contract terms.
Panama's wage structure includes Convención Colectiva that set sectoral minimums. Buyers search "minimum wage by sector," "CBA wages." Captures mid-funnel research intent.
National Statutory Minimum Wage: Panama's national minimum wage is $340 - $700 USD Monthly. Applies to all workers unless a higher sectoral minimum applies. Revised annually.
Convención Colectiva Sectoral Minimums: Panama has multiple active Convención Colectiva agreements covering specific sectors. These set minimums higher than the statutory minimum depending on industry and role. Sectors include key local industries.
How Sectoral Wage Floors Affect Payroll: If an employee falls under a specific CBA, you must pay the sectoral minimum. Underpaying triggers wage claims, back pay, and penalties. Ontop stores and applies the correct rate based on employee role and sector.
How Ontop Applies Correct Wage Floors: Ontop maintains an updated CBA database and automatically applies the correct minimum wage. During payroll preview, the system displays which agreement applies and confirms compliance. Removes manual compliance risk.
National Average Salary Benchmark: Colombia's national average salary is approximately ~$18000 USD per year. Varies by role, experience, and sector. Larger cities run up to 20% higher; rural regions typically align with the statutory minimum.
High-Cost Cities: Panama City and David: Panama City offers salaries ~20% above national average, particularly in tech and finance. Typical range: $1,800 - $2,500 USD annually for mid-level roles. David offers ~0% premium with strength in innovation and services. Typical range: $1,200 - $1,800 USD.
Secondary Cities and Regional Variation: Secondary cities generally sit between 5% to 10% above the national average, depending on local industries. Rural regions typically align with or fall below the national average. When budgeting for diverse teams, account for market research to ensure equitable offers.
How Ontop's Cost Calculator Handles Regional Modeling: Input location and role to preview total employer cost. See how regional differences, wage floors, and benefits combine to show true cost of employment by city.
Buyers search "contract types Panama," "permanent vs fixed-term." Legal structure and misclassification risk are critical for compliance.
Permanent Full-Time Employment (Contrato Indefinido): Standard indefinite contract with full statutory protections. Employees get all mandatory benefits (Décimo Tercer Mes, Vacaciones, sick leave, maternity leave, Prima de Antigüedad e Indemnización). Termination requires just cause or economic redundancy with notice and severance payout. Employer CSS contributions typically 12.25%.
Fixed-Term Contracts (Contrato Definido): Limited-duration contracts (typically for a fixed period, renewable). Used for project work, seasonal roles, or temporary needs. Same taxes and benefits as permanent, but with defined end date. Subject to renewal restrictions and CBA rules. Simpler termination but accrued benefits paid in full.
Part-Time Contracts: Reduced hours subject to local statutory limits. Salary and benefits are prorated by hours worked. CSS and taxes apply pro-rata. Ontop handles prorated Décimo Tercer Mes automatically.
Apprenticeships: Training contracts for students or junior profiles with reduced CSS contributions where applicable. Includes structured training and on-the-job learning. Misclassification can trigger reclassification penalties.
Self-Employed / Servicios Profesionales: Independent contractor operating own business. No employer obligations, only invoice payments. Contractor handles own CSS, taxes, invoicing. Critical: if worker appears to be employee (direction, control, exclusivity), you face reclassification and back-pay exposure.
Compliance Differences Between Contract Types: Tax rates, CSS contributions, benefits, termination rules, and Prima de Antigüedad e Indemnización accrual vary by type. Misclassification triggers wage claims, penalties, and reclassification costs.
How Ontop Templates & Payroll Logic Handle Each Type: Ontop provides compliant templates for each type and applies correct payroll logic: permanent benefits, fixed-term accruals, part-time prorations, apprenticeship rates, and Servicios Profesionales invoicing. Avoids misclassification risk.
Explain operational flow from onboarding to monthly payments. Reduces friction and clarifies steps.
Onboarding And Registration: Ontop handles registration with Panama tax authorities (DGI) and CSS and collects required IDs. Automation plus human verification reduces setup time and avoids compliance gaps. Typical onboarding: a few business days.
Monthly Payroll Calculation: Gross-to-net includes progressive 0 - 25 tax rates, 9.75% CSS, and Décimo Tercer Mes proration. Platform applies region-specific tax bands, CBA rules, and wage floors for accurate payslips.
Contributions And Filings: Employer contributions include CSS (9.75) and applicable local surcharges. Submitted according to statutory deadlines to CSS on your behalf. Ontop maintains records for annual reconciliation.
Payment Execution And Reconciliation: Payments in PAB/USD $ via local bank transfers to local accounts. Ontop shows conversion rates and fees before approval. Audit-ready receipts and instant USD payout options available.
EOR Vs Servicios Profesionales: Your Options: Choose Servicios Profesionales plans for flexible work or full EOR for permanent employees. Ontop supports both and highlights compliance differences so you pick the right structure.
Finance teams search "Panama payroll deadline." Captures operational queries and establishes Ontop as deadline-management partner.
Monthly Tax Withholding & CSS Payment Deadlines: DGI tax withholding due March 15th via DGI online portal. CSS contributions due End of the month to CSS authority. Late payments trigger Surcharges and interest by CSS/DGI penalty plus interest.
Annual Compliance Deadlines: SIPE Planilla: annual CSS reconciliation, due Monthly. Declaración Jurada de Renta: due March 15th. Certificado de Retención: annual employee tax certificate due March.
Payroll Processing Calendar (Monthly Example):
Week 1: Gather -> Pay 15th / Week 3: Gather -> Pay 30th. Key Regulatory Bodies & Filing Channels: DGI:
Tax collection. Online filing via official portals.
CSS: Social security.
MITRADEL: Ministry of Labor.
Penalties for Non-Compliance: Late DGI remittance:
Surcharges and interest by CSS/DGI plus interest. CSS shortfalls result in fines. Missing documentation increases audit exposure. Audit exposure increases with missing filings. Willful violations can trigger criminal liability.
How Ontop Manages Deadlines Automatically: Ontop tracks all compliance deadlines, sends alerts before due dates, and submits filings automatically. Finance team approves payroll ahead of deadlines. All documentation audit-ready.
Buyers search "how much leave Panama," "maternity leave," "paid leave entitlements." Impacts total cost of employment and satisfies planning intent.
Décimo Tercer Mes (April 15th / August 15th / December 15th): All permanent employees entitled to 1 month salary in 3 parts. Typically paid in April 15th / August 15th / December 15th, or prorated across year. Statutory bonus, not discretionary. Must factor into annual payroll cost.
Vacaciones: Minimum 30 calendar days of paid vacation annually. Unused leave carryover varies by CBA. Some allow unlimited carryover; others limit carryover. Leave paid at regular rate upon termination if unused.
Incapacidad: Statutory sick leave paid at 18 days paid by employer per year. Medical certification required after a few consecutive days as per local law. CSS may provide supplementary coverage for longer absences.
14 weeks of maternity leave. Paid at 100% via CSS by the local health entity. Additional parental leave may apply.
Public Holidays: Panama observes 11 days national holidays annually. Employees receive full pay or premium pay if required to work. Regional variations exist. Prima de Antigüedad e Indemnización: Permanent employees receive 1 week per year + 3.4 weeks per year (unjustified) when terminated without just cause. Prima de Antigüedad e Indemnización is a significant liability, must be accrued regularly and paid in full at termination.
How Ontop Automates Benefit Accrual & Compliance: Ontop automatically calculates Décimo Tercer Mes, leave balances (by CBA type), maternity deductions, and Prima de Antigüedad e Indemnización reserves. Payslips show accruals and deductions clearly. Audit-ready.
Decision makers need concrete cost inputs. Provide contribution ranges, deduction rates, and sample calculations for budget decisions.
Employer CSS And Additional Charges: Employer CSS varies by sector and contract. Approximate rates:
Employee Deductions And Tax Bands: Employee deductions include 9.75% CSS and progressive DGI tax: 0 - 25 Regional/local taxes may add extra percentages.
Total Employer Cost Example: Scenario: Permanent employee in Panama City at $1500 USD/month gross.
For annual planning, expect the total employer cost to be roughly ~12.25% above the gross salary, plus applicable statutory accruals for benefits.
Clarify payment rails, currency handling, and worker features that influence adoption and retention.
Local PAB/USD $ Transfers And Pay Runs: Payroll in Panama typically uses PAB/USD $ payments via local bank networks to local accounts. Ontop supports local rails so workers receive funds on payday in a single auditable run. No conversion friction.
Multi-Currency And Dynamic Conversion: When paying from other currencies, Ontop shows rates and fees before confirmation. Finance leaders get transparent previews. All conversions logged for audit.
Ontop Wallet And Instant USD Payouts: Workers receive USD via Ontop wallet backed by U.S. bank for fast access. Instant payouts reduce waiting times. Visible on worker dashboard and app. Useful for remote workers or USD preference.
Visa Debit And Worker Perks: Ontop issues Visa cards (physical or virtual) for immediate fund access. Security controls (instant freeze, limits) and perks (cashback, travel benefits, reduced transfer fees).
Buyers search "Panama payroll mistakes," "how to avoid penalties." Fear-based content drives conversions.
CSS Evasion: Failure to register employees triggers severe MITRADEL and CSS fines.
Ontop supports payroll for both contractors and employees in Panama. The platform provides contractor (Servicios Profesionales) contract templates and full EOR services for employees so you can choose the structure that fits compliance and operational needs.
Ontop applies local employer contribution rules (typically around 9.75) and sector-specific rates when calculating payroll liabilities. The system presents a clear breakdown of employer charges during payroll preview so you know the total cost before approval.
Yes, mandatory bonus structures like Décimo Tercer Mes are common. The standard structure is 1 month salary in 3 parts, usually paid in April 15th / August 15th / December 15th or prorated across the year. Ontop supports both approaches and reflects proration on employees' payslips and in cost projections.
Employees typically see CSS deductions around 9.75 and progressive DGI income tax withholding between 0 - 25 depending on income bracket and region. Ontop calculates and withholds the correct amounts based on salary, location, and personal circumstances.
Yes, Ontop provides cost previews that include employer contributions, taxes, statutory charges (like Prima de Antigüedad e Indemnización accruals), and regional variation. Use these previews to budget hires accurately and compare contractor versus employee scenarios.
No. Ontop can operate as your Employer of Record (EOR), handling all legal employer responsibilities and registrations. You avoid the complexity and cost of setting up a local company. Alternatively, if you have an entity, Ontop can serve as your payroll processor.
Common risks include misclassifying employees as contractors, missing DGI payment deadlines, and failing to adhere to Convención Colectiva rules. Ontop's automation and expert support mitigate these risks.
