If your Panamanian business bills more than about $3,000 a month, the tax authority's free electronic invoicing tool is no longer yours to use. As of January 1, 2026, Panama's General Directorate of Revenue (DGI) limits its free biller to businesses with annual gross income of B/.36,000 or less that issue no more than 100 electronic documents a month. Cross either line and you must route every invoice through a paid Authorized Qualified Provider — a PAC — or run your own DGI-certified invoicing system.
The balboa trades one-to-one with the US dollar, so B/.36,000 is roughly $36,000 a year. That is a very low ceiling: a freelancer billing $3,000 a month, a corner restaurant, a two-person services firm — all of them land above it. If you have been happily issuing invoices from the DGI's free portal, this guide explains what changed, how to tell whether the new limits catch you, and how to migrate without interrupting your billing.
What Changed on January 1, 2026
Panama's electronic invoicing runs on the Panama Electronic Invoicing System (SFEP), built on Law 256 of 2021 and Executive Decree 766 of 2020. Within the SFEP there have always been two ways to issue an invoice: the DGI's free biller (Facturador Gratuito), a no-cost web tool, and the PAC modality, where a private provider authorized by the DGI validates each of your tax documents.
Until recently the free biller was generous. Taxpayers with annual revenue up to about B/.1 million, issuing roughly 200 documents a month or fewer, could use it indefinitely. That made it the default choice for most small businesses.
Resolution No. 201-6299, issued July 29, 2025 and published in Official Gazette No. 30350 on August 25, 2025, rewrote those terms. Starting January 1, 2026, only taxpayers meeting both of the following conditions may keep using the free biller:
- Annual gross income of up to B/.36,000 (about $36,000)
- No more than 100 electronic documents issued per month
Everyone above either threshold must migrate to a PAC or implement their own DGI-certified electronic invoicing system. Government entities that need the free biller are the one stated exception, with no monthly document cap. Note the direction of travel: Panama has been widening mandatory e-invoicing for years — new RUC registrations since 2022, government suppliers, independent professionals such as lawyers and accountants in 2024 — and this resolution pushes the bulk of the remaining small-business volume onto supervised private infrastructure.
Do the New Limits Catch You?
The test has two prongs, and failing either one moves you off the free tool.
The revenue prong: B/.36,000 in annual gross income
Pull your 2025 gross income — not profit, not net, gross billings. If it exceeds B/.36,000, you belong on a PAC. Because the balboa is pegged to the dollar, the mental math is easy: $36,000 a year is $3,000 a month, or about $690 a week. A part-time consultant with two retainer clients can clear that bar.
The practical sting is that many businesses affected by this rule do not think of themselves as "big enough" for enterprise invoicing software. You may have three employees and a spreadsheet. The DGI does not care about headcount — gross revenue is the trigger.
The volume prong: 100 documents a month
Even if your revenue stays under the ceiling, issuing more than 100 electronic documents in a month disqualifies you from the free biller. Count everything the SFEP counts as an issued document: invoices plus electronic credit and debit notes. A low-ticket, high-volume business — a lunch counter, a print shop, a repair service writing dozens of small tickets a week — can trip the volume limit while sitting far below the revenue limit.
Run both numbers now, not at year-end. Export your 2025 monthly document counts from the SFEP portal and compare them against the 100-document line, and reconcile your gross billings against the B/.36,000 line. If either number is close, plan the migration anyway: growing into the threshold mid-year and scrambling for a provider with days of notice is the worst way to do this.
What a PAC Actually Does
PAC stands for Proveedor Autorizado Calificado — Authorized Qualified Provider. It is a private company the DGI has vetted and authorized, by resolution, to validate electronic tax documents on the tax authority's behalf. Panama uses a clearance model, meaning an invoice has no fiscal validity until it is authorized before delivery to your customer. The flow looks like this:
- Your system generates the invoice as an XML document following the DGI's technical specification sheet.
- You sign it with your qualified electronic signature, issued under a digital certificate approved by the National Directorate of Electronic Signatures.
- The signed document goes to your PAC, which checks it against the technical standard.
- The PAC grants the authorization for use and the document receives its CUFE — the Unique Code for Electronic Invoicing — which anyone can verify against the DGI.
- You generate the CAFÉ, the human-readable receipt, to print or send to your customer.
If your connection drops or the PAC has an outage, invoices can be issued in contingency mode and submitted for validation once service is restored. Corrections flow through electronic credit and debit notes rather than edited or deleted invoices — every document stays in the audit trail.
The SFEP supports up to 1,000 line items per invoice, so even businesses with long tickets can fit the format. And a PAC relationship is not exclusive in principle: issuers contract the services of at least one PAC, and larger operations sometimes keep a backup.
What Happens If You Ignore the Migration
Two consequences, one administrative and one commercial.
First, access. The DGI has been disabling free-biller access for taxpayers that exceed the new limits, leaving the SFEP portal unusable for them until the migration to a PAC is complete. A business that discovers this on the morning it needs to bill a client is stuck: it cannot issue a valid invoice from the portal it has always used, and onboarding a PAC takes days at minimum.
Second, validity. An electronic invoice that never receives its authorization for use has no fiscal standing. Your customer cannot support the expense, you cannot support the revenue, and the gap shows up the moment either party is reviewed. Paper workarounds do not help — taxpayers under the e-invoicing mandate generally hold an exemption from fiscal equipment, meaning the old machines are not a legal fallback either.
In short, this is not a deadline you can pay a fine and forget. Without a working issuance channel, you cannot bill.
How to Migrate in Six Steps
1. Confirm your numbers
Finalize the two tests above: 2025 annual gross income and peak monthly document count. Keep the exports — your accountant will want them, and they settle any question about which modality you belong in.
2. Get your qualified electronic signature in order
Every issuer needs a qualified electronic signature certificate from a provider certified by the National Directorate of Electronic Signatures of the Public Registry. If you have been invoicing through the free biller, you likely already hold one — check its expiration date now, because PAC onboarding stalls without a valid certificate. If you are newly caught by the mandate, apply early: identity verification and issuance take time.
3. Choose a PAC from the DGI's authorized list
Only providers the DGI has authorized by resolution can validate your documents. Ask candidates for their authorization resolution number and confirm it against the DGI's published list. Then evaluate on small-business criteria that actually matter to you:
- Pricing model. Most PACs sell monthly plans tiered by document volume, sometimes with a per-document overage. Map your monthly count to the tier — a business issuing 150 documents a month should not pay for a 5,000-document plan.
- Integration. If you run accounting or point-of-sale software, ask whether the PAC connects to it or only offers a manual web portal. A portal-only PAC recreates the free biller with a monthly fee.
- Contingency handling. Ask exactly what happens during an outage: how contingency mode is triggered, how backlogged documents are submitted, and who monitors the queue.
- Support in your language and hours. When invoicing breaks, you need a human who answers during your business day.
4. Budget the real cost
The sticker price is the PAC subscription, but the full migration cost includes the electronic signature certificate (usually an annual fee), any integration work with your accounting system, and staff time for training. On the other side of the ledger, PAC fees are an ordinary business expense — and businesses that integrate issuance with their accounting usually recover the cost in hours no longer spent retyping invoices into the books.
5. Register and run a parallel test
Complete your SFEP registration updates, link your PAC, and issue test documents before you cut over. Verify the full chain on a real invoice: XML generation, signature, PAC authorization, CUFE assignment, and CAFÉ delivery to a friendly customer. Confirm your customer can validate the CUFE. Only then switch your live billing to the new channel.
6. Notify the DGI about equipment changes if they apply
If your setup previously involved fiscal equipment, the regulations require notifying the DGI when it is replaced. Most free-biller users migrating to a PAC will not have equipment to retire, but confirm with your accountant rather than assuming.
Mistakes That Trip Up Small Migrators
Waiting until the month you breach a limit. PAC onboarding involves contracts, certificates, registration, integration, and testing. Starting when you are already locked out of the free biller means days of unbilled work.
Counting only invoices. Credit and debit notes count toward the 100-document monthly line. Businesses with frequent returns, discounts, or corrections hit the volume ceiling sooner than their invoice count suggests.
Letting the signature certificate lapse. An expired certificate halts issuance as completely as a missing PAC contract. Calendar the renewal date the day you migrate.
Hiring a provider that is not DGI-authorized. Software that generates pretty PDFs is not a PAC. If the vendor cannot show a DGI authorization resolution, its documents have no fiscal validity no matter how professional they look.
Treating migration as an IT task instead of an accounting task. The PAC changes how revenue enters your books — document numbering, timing of authorization, contingency backlogs, and the fee itself all need a home in your chart of accounts. Keep your accountant in the loop from step one.
Keep Your Billing and Your Books in Sync
A PAC integration is, at its core, a bookkeeping upgrade disguised as a compliance chore. Every invoice your business issues now passes through a validated, numbered, timestamped channel with a CUFE your accountant can verify independently. Businesses that pipe that feed straight into their accounting — rather than retyping portal data at month-end — close their books faster and walk into any DGI review with a ledger that matches the tax authority's own records document for document.
Track the migration costs cleanly, too: PAC subscription fees, the signature certificate, and integration work each deserve their own expense lines so you can see what compliant billing actually costs you per year.
Simplify Your Financial Management
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