Transcription
Dubai or Panama? If you had to pick one place to live and pay almost zero tax, which one would you choose? Most people answer too fast and they choose wrong. I run a company with headquarters in Dubai and this year we are opening a second office in Panama. So I've seen both from this side. Today, I'm going to break them down point by point and by the end you'll know exactly which one is right for you.
So now, let me tell you why I can actually compare these two and I'm not just talking from theory. Like I said, our headquarters are in Dubai so I honestly know this place from the inside, the good and the bad. And by the end of this year, we are opening a second office in Panama. In fact, my business partner is moving there to run it himself. So as you can see, this is not a video made from Google searches. This is real. So the thing is, these are two of the best options in the world right now if you want to live well and pay almost zero tax. But they are very different. So I'm going to go point by point and by the end you might be surprised which one fits you better.
Okay, so let's start with the first point. How do you actually get a residence permit in each country? And honestly, both work in a very similar way. Well, let's start with Dubai. The easiest way is to open a company, what they call a free zone company. And then this company is sponsors you. That's it. You get your residence permit through your own business. And the best part is the speed. You can have everything done in less than a month. Less than a month. It's really simple and fast. You just need to do a quick medical test and you're in.
Now let's go with Panama. It works in a very similar way. You can also open a company with local activities and this company sponsors you as long as you qualify for the friendly nations visa. But here's the thing you need to If you don't qualify for that, the local company option won't work for you. In that case, it has to be a free zone company, which actually lets you sponsor most nationalities, as long as there are no sanctions involved. Also, both countries have a golden visa program if you prefer to go that way. In Panama, it's around $300,000 right now. And in Dubai, it's about $500,000. So, on the first point, I'd say Dubai has a little bit of an edge. I mean, because the whole process is faster and a smaller. But Panama is not far behind. You can still get it done in a reasonable time. So, Dubai wins this one, but just by a little.
And by the way, real quick, for those who don't know me, my name is Alejandro. I've spent over 10 years in international tax and wealth preservation. And I've even worked as a lawyer at big four firms. So, everything I'm telling you here, it's not theory from the internet. It's what I actually do every single day with real clients. So, let's keep going.
Now, the second point, and this is really important. We are going to talk about how to get your tax residency in each country, because this is where a lot of people get confused. Let's start with Dubai again. In the Emirates, you have two options. The first one is the 90 days rule. With 90 days in the country, plus a permanent home or an economic activity or a job, you can already get a certificate. And the second option is the classic one, more than 183 days in the country. But here's the thing you need to understand. The 90 days option only gives you a local certificate, and that one is not enough if you want to use it the benefits of a double tax treaty. For that, you need to spend 183 days in the country.
In Panama, you need to spend more than 183 days in the country to get your tax residency certificate. So, there is no shortcut like the 90 days option here. So, what does this mean? Well, for people who don't need the treaty certificate to buy is clearly more flexible because that 90 days rule is a big advantage. You spend much less time in the country and you're still fine. While in Panama, you have to commit to more than half of a year. So, I would say on the flexibility, the Emirates wins this point. But, and this is important, only if you don't need the certificate for treaty purposes. If you do, then both countries ask you for basically the same thing, real time on the ground, more than 180 days.
Okay, now the big one, the point everybody actually cares about. How much tax do you really pay in each country? Panama works on something called a territorial tax system. And honestly, it's the most powerful one out there. What does that mean? It's very simple. Anything that comes from outside Panama is not taxed at all. So, if your income comes from an offshore company, you can get a pure 0% tax. Always, as long as this money is not coming from outside. This way, no tax at all.
In the Emirates, there is no personal income tax, which is great and it makes compliance almost nothing. It's very comfortable. I mean, you don't have to deal with much. But, here's the catch. There is a corporate income tax and it goes from 0 to 9% and the 9% kicks in after around $100,000 of profit. And there is something else you need to know. If you run an offshore company with no real substance in the Emirates, they can actually say that that company is local and make you pay that corporate income tax anyway. So, when it comes to pure taxes, I'd say Panama has a slight edge over the Emirates because in Panama, you can still get a clean pure zero as long as your income comes from outside the country.
But hold on because here Dubai has one big advantage that serious business owners need to know about, tax treaties. The Emirates have signed more than 100 double tax treaties with different countries. On the other side, Panama has around 17. And I mean, that's a massive difference. So if you're building a holding company or a structure that moves dividends and profits across borders, the Emirates are simply a much better jurisdiction for that. You can actually look it up. Compare the treaties each one has in force and you'll see it's not even close. So let's call it fair. Panama wins on the pure zero for individuals, but Dubai wins as a base for holding companies. Each one has its own strength. And by the way, this is exactly the kind of thing where people get it wrong on their own. If you want to avoid that, we'll leave a link below. But let's keep going.
Now let's talk about banking. And honestly, both countries have a strong, solid banking system. So you are in good hands either way. But there are some differences worth knowing. In Panama, the economy is dollarized. Everything runs in US dollars. And that's actually a big advantage because when it comes to receiving international transfers or moving money around, being in dollars gives you a real edge. It just makes everything a smoother. But here I have to be honest with you. Some banks in the Emirates have become a little bit bureaucratic lately. And I'm telling you this from my own experience. Not long ago, I went to a bank and they started questioning my signature. They told me it didn't look the same and they made me sign it again and again and again. I literally lost a whole morning sitting there. So yeah, it can get a little frustrating sometimes. So on banking, I'd say it's pretty even. Both are strong, but Panama gets a more points because of the dollar advantage, especially if you receive a lot of international transfers.
Now, here's the point that a lot of people forget about, but it's huge if you are thinking long term. The second passport. And this is where the two countries are completely different. In the Emirates, getting local passport is basically impossible. It doesn't matter how many years you live there, it's not just going to happen. You're going to stay as a resident, but citizenship is off the table. However, Panama is a different story. After only 5 years of permanent residency, you can apply for a passport. In some cases, that can actually be reduced to 2 years. So, if your goal is to get a second passport one day, this is a massive difference. So, on this point, as you can see, there is no debate. Panama wins clearly. If a second passport is part of your plan, the Emirates simply can't offer you that, and Panama can.
Now, let's talk about safety. And honestly, this is a big one for a lot of people, especially if you're moving with your family. Here, the Emirates win clearly. Dubai is one of the safest places in the world, no doubt about it. You can walk anywhere at any time of the night and feel completely safe. For families, for kids, it's just another level. That peace of mind is real, and it's one of the biggest reasons people move here. But, don't write off Panama too fast. Panama is actually doing a really good job with safety. And here is something that surprises a lot of people. In the safety indexes, Panama is already safer than some European countries like the UK or Sweden. Yeah, you heard that right. So, this whole idea that Latin America is dangerous, it's just not the full picture anymore. So, on safety, the Emirates take the point clearly, but Panama is closer than most people think and it keeps getting better.
Now let's talk about health care because if you're moving your whole life somewhere, this matters more than people think. Especially if you have a family. And here Dubai wins clearly. The health care in the Emirates is honestly some of the best in the world. And the reason is very simple. Dubai attracts top doctors from everywhere on the planet. The best specialists from Europe, from the US, from everywhere. They come here and the hospitals are absolutely world-class with the latest technology. So when it comes to health, you're in incredible hands.
Now Panama. And let me be fair here. Panama's health care is not bad at all. The private hospitals are good and the local doctors are solid. But there is one thing you need to know. Foreign doctors are restricted in Panama. So unlike Dubai, Panama doesn't really bring in that wave of international specialists. That doesn't mean the local doctors are bad. Not at all. It just means you don't get the same global talent coming in. So on health care, Dubai takes this one clearly. If having the best hospitals and the best doctors in the world close to you is a priority, the Emirates are hard to beat.
Okay, now let's move on something that everybody cares about, no matter who you are, the cost of living. How much does it actually cost to live in each place? And here Panama has a clear edge and I mean a real one. In Panama you can find apartments in amazing areas, really nice ones at a very good price. You get a lot for your money. Honestly, if I move to Panama, I already know where I would live. I would go to Santa Maria. For me, it's the closest thing to Dubai Creek, which is my favorite area here in Dubai. Same vibe, that mix of green, water, walls, nice restaurants, that combat premium feeling, but for a fraction of the price. And actually, we already have a client who bought an apartment there in a project we work with with our help. And now, he's playing golf basically every day enjoying that 0% tax life. So, as you can see, this is not just a nice idea. It's real. People are already doing it. And if you want to follow his path, you just need to reach out to us.
Dubai can absolutely be affordable, too. Don't get me wrong. There are options for every budget. But if you want that high-end lifestyle, the prime areas, the best buildings, you're going to pay for it. In Panama, that same level of life just cost you less. So, if getting more for your money matters to you, Panama takes this point.
Okay, now my favorite part, lifestyle. And this is where these two countries are completely different worlds. Let's start with Dubai. If you love luxury, fancy restaurants, shopping, and more of an indoor lifestyle, the Emirates win, no doubt. This place is built for that. And here's something a lot of people don't know. The UAE is not just buildings and malls. There are actually many beautiful places to visit, contrary to what most people think. You have places like Ras Al Khaimah with very beautiful mountains. You have Fujairah on the East Coast with beautiful beaches and mountains, too. And you have the oasis in Al Ain. There is a lot more to explore than you would expect.
But now, let's talk about Panama. And I mean, if you love the outdoors, nature, and adventure, this is where Panama becomes unbeatable. Panama has beaches on the Pacific side, beaches on the Caribbean side, and some of the most incredible island you'll ever see. Places like San Blas. And let me tell you, San Blas is actually one of the most beautiful places I've seen in my entire life. Imagine spending your weekend there in the middle of the paradise. It's just another level. And there is one more thing about Panama that people don't think about, air quality. Panama is green. It's full of nature and the air is clean and fresh. Look, I actually took these screenshots today. Here, you can see the air quality in Panama right now. It's healthy. And meanwhile, here is Dubai today and the quality is quite poor and that makes a real difference because with this heat, you just don't want to spend much time outside here. In Panama, you live outside. But look, to be fair, the authorities here in Dubai are doing a great job with this. They are planting a lot of trees and really working on improving the air. In fact, they are building a huge loop that will cross the entire city just for people to walk and do a sports even with the heat. It's actually incredible. And honestly, in all the years I've been living here, if there is something that doesn't quite work, they fix it and they make it better. So, credit where it's due. But for now, it's not just something that can compete with Panama yet. So, if waking up to clean air and outdoor life matters to you, Panama has a real edge here.
Now, let's talk about location, which is huge and people forget about it. If you want to be close to Europe, the Emirates have the advantage. That's true. But if you want to be close to the United States, Panama wins clearly. You are about 2-hour flight from Miami. 2 hours and that's very very important if your business or your life is connected to the US or Latin America. So, lifestyle, there is no winner here. I mean, it really depends on what you love. Luxury and comfort, go for Dubai. Nature, clean air and adventure, go for Panama.
Okay, so now the moment you've been waiting for. After comparing everything, which one is actually the best? And like I told you at the beginning, the answer is not the same for everyone. It really depends on who you are and what you want from life. So, let me make it simple for you. Go with Panama if you want a true 0% tax and a life outdoors, surrounded by beaches, nature, clean air, and adventure. If being close to the US and Latin America matters to you, and if a second passport is part of your long-term plan, then in this case, Panama is the right move for you.
Go with Dubai if your top priority is safety, world-class healthcare, and a family-friendly life. Great international schools, luxury, comfort, and being close to Europe. If you want that peace of mind where you can walk anywhere at any time, then in this case, Dubai is the right move for you. So, you can see there is no single winner here. There is only the winner for you. Two of the best options in the world right now, and now you actually know which one fits you better.
And look, that's the part where we come in. At Tax Move, we help you figure out which country really fits your case. And we set everything up properly so you don't make those expensive mistakes. So, if you're serious about it, the link's down below. Just reach out and we'll talk. See you in the next one.