What is CSS (Caja de Seguro Social)?
The CSS is Panama's social security institution. Employees contribute 9.75% of gross salary with no cap, and employers also contribute under a rate that is being raised in stages by Law 462 of March 2025.
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Current Rate (Monthly remittance through SIPE)
Employee 9.75% with no cap. Employer rate rising under Law 462 of March 2025, reaching 15.25% from March 2029. Employers also pay 1.50% Educational Insurance plus a Professional Risk premium of roughly 1.05% to 5.67%
Example
For an employee on a gross monthly salary of US$2,000, the employee contribution is US$195.00 at 9.75%. The employer shares are calculated on top, at the rate for the current step.
How CSS (Caja de Seguro Social) works in Panama
Employer and employee contributions are remitted monthly through the CSS electronic payment system, SIPE. Income tax withheld from salaries is remitted separately to the DGI, on a separate calendar.
The employer rate is legislated to step up over time. Because the current step depends on the payroll period, check the rate for the month being paid before running payroll.
The Professional Risk premium varies with the CIIU industry classification of the employer. Finn asks for the classification so the premium can be estimated for employer cost.
Related terms
The décimo tercer mes is a mandatory 13th-month payment equal to one month's salary, paid in three equal instalments on 15 April, 15 August and 15 December.
The RUC is Panama's primary tax identifier for both individuals and companies, issued by the DGI. It appears on invoices and on ITBMS and income tax filings.
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