PANAMANIAN OFFSHORE CORPORATIONS
Excelling as a tax planning
instrument, Panamanian corporations are widely known and
used throughout the world. Panamanian corporations offer
many tax benefits when used as Offshore Corporations or
IBC’s, as called in other jurisdictions, also taking into
account that the Republic of Panama is considered a tax
haven country.
Panamanian corporations are
easy to manage offering versatility and security. Ruled by
Law 32 of 1927, Panamanian
corporations can also be used for establishing local
business, within the Republic of Panama. |
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Established as an offshore
corporation, Panamanian corporations are also commonly used
as the perfect asset protection tool since Panamanian
corporations can function as a holding company or own assets
kept anywhere or real estate property located in any country
without having to pay taxes in Panama for those properties
held outside.
A great advantage Panama laws
offer Panamanian Offshore Corporations (a.k.a. IBC’s) is the
possibility of developing tax free offshore activities,
since Panama has a territorial tax system.
Panamanian corporations thus
serve businessmen, investors, or foreign companies for
making savings on tax payments.
An offshore corporation may
open bank accounts in or outside Panama and own property
located outside Panama without having to pay taxes in Panama
for this.
PANAMANIAN CORPORATIONS LAW (.doc file)
Form to order a panamanian corporation
or private interest foundation
BENEFITS AND ADVANTAGES OF PANAMANIAN OFFSHORE CORPORATIONS
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No obligation to pay
income tax when its income is obtained from a source
outside Panama. So, no income tax will be paid
for offshore operations or activities.
According to Panama
Tax Laws, no income tax is paid for the following
corporate activities: |
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Invoicing the sale of
goods and merchandise through a Corporation’s office
in Panama at a price greater than the one invoiced
to the corporation in Panama for the same goods or
merchandise, as long as those products or goods stay
out of Panama; |
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Directing, through a
Corporation in Panama, transactions that will become
effective, consummate or perfect outside Panama; and |
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Distributing dividends
and participations from Panamanian Corporations or
other juridical persons when income is not produced
in Panama, including the above mentioned situations. |
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Maintenance costs,
including annual corporate taxes and resident agent
fees are only USD 550.00 |
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Stockholders may be
Panamanians or foreigners and may even be Panamanian
or foreign corporations |
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No nationality or
residence requirement for the Panamanian
corporations’ Directors and Dignitaries |
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Meetings of the
stockholders assembly or the Board of Directors may
be held anywhere in the world and can be held via
telephone, fax, email or any other electronic method
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Corporate assets or
capital of a Panamanian corporation may be kept
outside Panama |
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Panamanian
corporations may have any licit objectives and carry
out any commercial or industrial activity. Corporate
objectives do not need to be explicitly expressed in
the Articles of Incorporation, while Panamanian Law
on Corporations allows having general corporate
objectives. |
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One person alone can
be owner of 100% of the corporate stocks comprising
the entire corporate capital of a Panamanian
offshore corporation, after its incorporation and
registration. |
INCORPORATION OF PANAMANIAN CORPORATIONS
Panamanian corporations may be
incorporated in just three days.
For the incorporation of a
Panamanian corporation,
Law 32 of 1927 requires the
celebration of an agreement between two or more persons of
legal age, who are required to subscribe at least one
corporate stock, each, without consideration to their
nationality or domicile. This agreement, called Articles of
Incorporation, must be done before a Notary Public in
Panama, who transcribes it in a Public Deed. The Deed must
then be inscribed or registered in the Public Registry.
To facilitate this
incorporation process, usually two persons from our Law Firm
in Panama would sign the required agreement and after
registering the corporation, these two persons issue and
sign a resignation to all their rights and interests in the
corporation as subscribers of the Articles of Incorporation. |
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The Articles of Incorporation
will reflect the terms and conditions agreed and, after its
registration in the Mercantile Section of the Public
Registry, this document will be effective against third
parties as well. Law No. 32 of 1927 on Corporations, in many
aspects, works only as a secondary source of rules.
As ordered by law, the
Articles of Incorporation must, at least, contain the
following information: |
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Name of the Corporation
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Name and domicile of the
subscribers of the corporation
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Corporate objectives
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Corporate Capital (a
description of the amount, if the corporation has par value
or non par value stocks, number of stocks, distribution,
classes, etc.) |
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Duration of the corporation,
which can be perpetual |
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Name and complete address of
directors and dignitaries |
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Name and address of the
Resident agent |
CORPORATE CAPITAL OF PANAMANIAN CORPORATIONS
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Panamanian corporations are
not required to have a paid capital to be valid after its
incorporation and these corporations may issue nominative or
bearer stocks. When corporate stocks are issued to the
bearer, share in the corporate capital corresponding to
those stocks issued to the bearer is presumed paid.
Any kind of person, a natural
person or other corporation or company, can become a holder
or owner of the corporate stocks, with no need for having
legal residence or being present in the Republic of Panama.
Any nominative stock may be issued in favor of more than one
person.
TAX BENEFITS
OF PANAMANIAN CORPORATIONS
Panamanian Corporations are
subjected to a territorial tax system, a regime that only
requires payment of taxes for operations done or considered
done within the territory of the Republic of Panama.
Under Panamanian Tax Law, commercial operations executed,
taking place, or taking effects outside Panama will be
considered offshore and are not taxable, without considering
that these operations may be managed or directed from an
office located in Panama. Except for the annual
corporate tax in the amount of USD 300.00 that all
corporations and private interest foundations must pay,
there would be no other tax obligations for Panamanian
offshore corporations.
CORPORATE
ANNUAL TAX IN PANAMA
Panamanian corporations have
the obligation to pay annual corporate taxes in the amount
of USD 300.00, while only the first annual tax is
USD 250.00.
For corporations registered
between January and June, June 30 of each year, will
be the deadline for the annual tax payment, while for
corporations registered between July and December,
December 31 will be the deadline for paying annual
corporate taxes. For this purpose, registration date
is that of the inscription in the Public Registry, as
written in the stamped seal at the end of the Articles of
Incorporation.
Corporate taxes not paid on
time will have a USD 50.00 overcharge for each year
due and a USD 300.00 fine for delays of two or more
annual tax payments.
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renders legal services having the satisfaction of the
client’s needs and interests as a priority, with
personalized treatment and high quality, efficient, and
ethical standards.
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