Leaving the UK

Do I pay UK tax if I move to Panama?

Answered by Jordan Onraet-Wells, Founder & Chartered Tax Adviser (CTA). Published 28 July 2026. Last reviewed 28 July 2026.

The short answer

Yes, at least at first: you keep paying UK tax on your worldwide income until you have broken UK tax residence under the Statutory Residence Test, and moving to Panama does not change that on its own. Once you are non-resident, the UK taxes only your remaining UK-source income, and Panama's territorial system leaves non-Panamanian income outside Panamanian income tax. Some income stays UK-taxable after you go, including UK rental profits and gains on UK property.

HMRC taxes your worldwide income until you are non-resident under the Statutory Residence Test; a Panamanian visa changes nothing on its own.
Full-time work abroad with fewer than 91 UK days and no more than 30 UK workdays is the cleanest route out.
Split-year treatment can tax you as non-resident from your departure date, claimed on the SA109 pages, not the P85.
UK rental profits, UK government service pensions and gains on UK property stay UK-taxable after you leave.
Coming back within five years can trigger the temporary non-residence rules, and the residence-based inheritance tax tail can run for up to 10 years.

Fixed-fee service

Non-Resident and Expat Tax Return

£750 fixed

A Chartered Tax Adviser prepares and files your UK return for the year you leave, SA109 residence pages and any split-year claim included, and the non-resident returns that follow if you keep UK income. That is the total, agreed before any work starts. Never hourly. A return with several income streams, investments or structures is the Complex Personal Tax Return, from £950, and we tell you which fee applies before you commit.

SA109 residence pages and the split-year claim for your departure year
UK rental income, employment, pensions and gains on the right pages
Personal Allowance claimed as a non-resident where you qualify
Filed online as your agent, so the 31 January deadline stays open

Tax returns for expats

Until you break UK residence, nothing changes

The UK taxes residents on their worldwide income, so a move to Panama only helps once you are non-resident under the Statutory Residence Test. The cleanest route is working full-time abroad (averaging at least 35 hours a week) while keeping UK visits below 91 days, with no more than 30 UK workdays. If you leave part-way through a tax year, split-year treatment can tax you as non-resident from your departure date. You claim it on the SA109 pages of your Self Assessment return; the P85 does not do this for you.

What stays UK-taxable after you leave

Non-residents still pay UK tax on UK-source income. Rental profits fall under the Non-Resident Landlord Scheme and normally need a Self Assessment return, UK government service pensions remain UK-taxable, and gains on UK property must be reported and any tax paid within 60 days of completion, even where nothing is due. Two longer tails matter. If you return within five years, the temporary non-residence rules can tax gains and certain income you realised abroad in your year of return. And since 6 April 2025 inheritance tax has been residence-based, so a long-term UK resident can stay exposed on worldwide assets for up to 10 years after leaving.

The Panama side

Panama taxes only Panamanian-source income, at 0% up to USD 11,000, 15% from USD 11,000 to USD 50,000 and 25% above that. Foreign-source income, such as UK dividends or gains on a non-Panamanian portfolio, sits outside Panamanian income tax. The main 2026 residence routes are the Pensionado visa (a lifetime pension of at least USD 1,000 a month), the Friendly Nations Visa (USD 200,000 in property or a deposit, or a Panamanian job) and the Qualified Investor visa (from USD 300,000 in real estate), and a UK-Panama double taxation convention has been in force since 12 December 2013. The case for the move is a lawful territorial system plus a clean, well-documented UK exit. For the residence routes, the departure admin and the full timeline, see our guide to UK tax when moving to Panama.

Go deeper

Sources and further reading

This is general information for the 2026/27 UK tax year, not personal tax advice; speak to a Chartered Tax Adviser about your own position.

Deadline 31 January 2027

Filing a 2025/26 return?

A Chartered Tax Adviser prepares and files it for you, including the pages HMRC's free online service cannot handle. Fixed fees from £450, non-resident and expat returns £750 fixed, agreed before any work starts.

How it works

Applies to you? Ask us directly

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