Background & General Outline
Background & General Outline
Panama is a small country that sits between Central America and South America. Home to four million people, it’s capital and the largest city is Panama City.
Famous for the Panama Canal, the country is in a strategic location between Costa Rica, Colombia, the Caribbean Sea and the Pacific Ocean. Panama is an independent state with a competitive economy and a high standard of living.
The Panamanian economy is based mainly on its service sector, particularly trading, commerce and tourism. The Panama Canal is one of the main sources of national revenue and employs thousands of locals. After being controlled by the US for 85 years, it was handed back to the Panamanian government in 1999.
Panama’s banking and the financial sector is another leading source of employment and revenue. It employs some 24,000 people and accounts for almost 10% of the GDP. It was removed from the FATF grey list in 2016 and is recognised as a leading offshore jurisdiction.
Political Structure & Legal System
Panama is a presidential representative republic, a democracy, and enjoys a multi-party system. The President is the head of government and the head of state and exercises all executive power. The Panamanian judiciary is independent of the President and legislature and is governed by the Constitution.
The country’s legal system is based on a combination of French and Spanish law, with elements of the American legal system. The Supreme Court is the highest court in the country and there are other civil and criminal courts, including specialised courts that deal with more minor matters.
Name Restrictions for an Offshore company in Panama
Any offshore company in Panama must adhere to certain naming restrictions. Firstly, it must include specific legal endings such as Incorporated, Corporation, Sociedad Anonima, Inc., Corp., or S.A. The name of the company can be in any language but must not be the same as, or similar to an existing Panama offshore company. It must also not be a word that could be construed as being offensive, undesirable or obscene.
Trading Restrictions
An offshore company incorporated in Panama is not allowed to carry out business or activities within Panama. All activities and revenue must be generated outside of the country. It is also not allowed to carry out banking, insurance, reinsurance, fund management, investment schemes, or trust management, amongst others. If you wish to carry out any of these activities, company formation in Panama may not be quite what you’re looking for.
Taxation in Panama
Anyone who decides to go with company formation in Panama will be exempt from taxation as long as activities are carried out internationally. The Panama government doesn’t require activities being carried out, offshore to be declared to the tax authorities.
Double Taxation Treaties
Panama is now party to a number of double taxation treaties. These include jurisdictions such as the UK, Canada, Belgium and Japan.
Accounting & Financial Statements
An offshore Panama company is not required to present any periodic reports to the Panamanian authorities. This includes both accounting and financial statements. Any books and records that you keep as a matter of best practice are 100% private and confidential, protected by local law.
Disclosure of Beneficial Owner
The owner of an offshore company in Panama is not required to be disclosed to the authorities. The agent that handles the formation of the company, however, is required to keep details of the identification of shareholders as per KYC laws. This information does not have to be shared with the authorities. Bearer shares or nominee shares can be issued with or without par value.
Capitalization Requirements for Company Formation in Panama
If you opt for company formation in Panama, you are not required to set a certain limit on share capital. You also don’t have to pay up any capital in order to form the company.
Exchange Control
There are no exchange controls on monetary remittances to or from an offshore company in Panama.
How Much Does an Offshore Company in Panama Cost?
You can get your Offshore Company for as little as €1,800 with our Formation Package. You can also benefit from our special renewal package and additional optional services. To get full price details, related documents and services click on the button below:
Contact Us for Company Formation in Panama
Panama is home to over half a million offshore companies. Many individuals have chosen Panama as a great place to get their international business started. Contact us today to get your offshore company registered in Panama.
More Locations to Incorporate Your Company
Not sure about Panama? No problem! There are several other locations to consider. Select any of the countries below to learn more:
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