Panama Employee Payroll — Planilla, CSS (SIPE), ISR & Décimo

Confirm the employer is registered with CSS (required before SIPE filing) and collect the data needed for each employee: cédula, hire date, activity/occupation, company size, and region (Region 1 or 2 under MITRADEL Decree 13 of 31 Dec 2025). Verify every salary is at or above the applicable minimum-wage cell. Flag any unregistered worker — payroll cannot be lawfully processed until CSS registration is complete.

Compute the monthly ISR to withhold from each employee's gross Panamanian-source salary. Project annual income by multiplying monthly gross by 13 (12 months + décimo), apply the DGI bracket schedule (0% up to B/.11,000; 15% on B/.11,001–50,000; 25% above B/.50,000), then divide the resulting annual ISR by 12. Confirm whether each employee has a single salary source — if so, monthly withholding is the final tax obligation and no personal return is required.

Compute employee and employer social-security charges for the pay period. Employee deduction: 9.75% CSS + 1.25% Seguro Educativo = 11.00% of gross, no ceiling. Employer contributions: 13.25% CSS + 1.50% Seguro Educativo = 14.75% total (effective to 28 Feb 2027; rises to 15.75% from 1 Mar 2027 and 16.75% from 1 Mar 2029 under Law 462), plus the separate Riesgos Profesionales rate (0.33%–6.25% depending on the company's occupational risk class assigned by CSS).

Calculate and schedule the three mandatory Décimo Tercer Mes installments (15 April, 15 August, 15 December). The total annual décimo equals approximately one month's salary (1 day per 11 days worked in each 4-month period). Apply the reduced CSS rate of 7.25% on the décimo payment rather than the standard 9.75%; apply ISR if the employee's annualised income is in a taxable bracket. Prepare the bank disbursement file and ensure the décimo is not folded into the regular monthly SIPE filing.

File the monthly CSS planilla via the SIPE online portal (declare and pay combined CSS, Seguro Educativo, and ISR withholding). The SIPE declaration must be submitted before the 21st of the current month; payment is due within the following month. The ISR withheld must also be remitted separately to DGI by the 15th of the following month. At year-end (by 31 March), file Planilla 03 (employer annual return of salaries and withholdings) with DGI and issue Form 03 (Comprobante de Ingresos) to each employee.