Frequently Asked Questions
Questions about Panama
Once you become a resident of Panama, if you wish to work, you will need to apply for a work permit. However, not all Visas allow you to work in Panama, hence it is very important to discuss the matter with us so we can advise accordingly.
Citizens of countries that only require to have a valid passport to enter Panama, normally can stay up to 180 days. Citizens of certain countries with restrictions can only stay up to 30 days, but may request an extension.
You would need to apply for the Special Retiree Visa with Special Passport. The passport does not grant Panamanian citizenship. The visa is valid for 5 years and it requires an investment in CD that must be open with the National Bank of Panama. The CD must yield at least USD850.00 in interest per month.
Recently it was decreed that if a foreigner has a permanent residence in Panama and leaves for two (2) years and up to six (6) years, he/she can request the rehabilitation of the residence by filing, through a Lawyer, a petition within 30 days reentering the country.
There is no citizenship by investment program. To gain Panamanian citizenship the first step is to apply for a Visa that grants permanent residence. The second step is to determine whether you qualify as you reunite the requirements necessary to comply with Article 10 of the National Constitution of Panama:
- Foreigner with five (5) consecutive years of residence in the Republic of Panama;
- Foreigners with three (3) consecutive years of residence in the Republic of Panama that have children born in Panama, of a Panamanian mother or father or have a Panamanian spouse;
- Foreigners born in Spain or a Latin American country, if it fulfills the same requirements demanded from Panamanians in those other countries.
On the other hand, Panama does offer some Residency by Investment Visa such as the economic solvency visa, which requires an investment of USD300,000 and a Reforestation Visa, which requires an investment of USD80,000. Contact us for more details.
Yes, you have come in person, first of all, because your passport needs to be registered with the National Immigration Service and secondly, we need to include your original passport with the Visa application.
Our service includes helping our clients with the bank account required for this Visa. We always go the extra mile to our clients, even go as far as arranging that at least 90% of the process to open a bank account is done before they arrive in Panama.
Applicants to any Visa in Panama need to submit a certificate of no criminal record. If you do have a criminal record, then it will depend on the crime whether the National Immigration Service will accept your application or not, it is entirely discretionary. However, if the crime for which you were convicted is not tremendously serious, like murder, rape, drugs, money laundering, there is a likelihood we can talk to the National Immigration Service and determine whether they will accept your application.
Yes, any foreigner applying for a Visa needs to also apply for the multiple entry exit Visa in order to travel in and out of the country while the Visa is being processed. If you do not obtain this permit, the next time you return to Panama you will be penalized with a fine of $2,000.00. We include this multiple entry exit Visa (permit) by default with all applications.
Only if you are a foreign national of 60 years of age (men) or 55 (women) and also a resident of Panama, proven with your residency card or Panama ID card (cedula).
Income tax rates in Panama are:
For individuals:
Up to $11,000 per year - no tax
From $11,001 up to $50,000 per year – 15%
Over $50,000 per year - $5,850 for the first $50,000 and a tariff of 25% on the excess over $50,000
For companies, the tax rate is 25% on the net income.
In Panama, this tax is better known as tax for the transfer of goods and services. The rate is 7%. There are exemptions, meaning that not everyone needs to collect this tax from clients. If you or your company are involved in a business, and your gross receipts do not exceed USD36,000 per year, you are not considered a taxpayer for this tax.
To become a tax resident in Panama and therefore be eligible to apply for a Tax Residence Certificate, the following rules apply:
Article 762-N of the Fiscal Code of the Republic of Panama defines who is considered a Tax Resident:
Article 762-N: They are considered tax residents of the Republic of Panama natural persons who remain in the national territory for more than 183 calendar or alternate days in a fiscal year or the year immediately preceding.
Likewise, they shall be considered fiscal residents of the Republic of Panama, those natural persons who have established their permanent residence in the territory of the Republic of Panama.
They are also considered fiscal residents of the Republic of Panama, legal entities incorporated under the laws of The Republic of Panama and have material means of Direction and administration within the Panamanian territory.
Likewise, juridical persons constituted abroad who have material means of management and administration within Panamanian territory and who are duly registered in the Public Registry are considered to be fiscal residents of the Republic of Panama.
Corporations and Foundations
We are registered agents in Panama and Belize; thus, we can incorporate companies in these jurisdictions. However, the more than 20 years we have operating, we have established partnerships and alliances in a wide range of jurisdictions, to mention a few: BVI, Nevis, Cayman Islands, Bahamas, Seychelles, and the Marshall Islands.
The registered agent is the person or entity that serves as an agent of process and in many jurisdictions is the person or entity (in some countries like Panama only lawyers or law firms can act as the registered agent) that is tasked with maintaining know your client documents and compliance with anti-money laundering regulations.
We do. As registered agents, we have to comply with anti-money laundering regulations and perform due diligence. Such is our responsibility and commitment, and this further provides a good and safe business environment for everyone.
The short answer is to shield yourself from liability that you may incur while doing business; in addition, using a corporation adds flexibility and the ability to attract investors. A foundation, on the other hand, will not only help you to shield your assets from liability, but also for estate planning purposes.
This will depend on the jurisdiction, but in the vast majority, only one id required. In Panama, three directors are required as a minimum. Also, it is essential to mention that directors can be citizens or companies in any country.
In the vast majority of jurisdictions, including Panama, only one. Also, it is essential to mention that shareholders can be citizens or companies in any country.
No, the shareholders of a Panama company incorporated under Law 32 of 1927 are not made public.
For some time now, in all major jurisdictions, it is necessary to have accounting.
In Panama, you can, but only sporadically. Law 25 of 1995 prohibits explicitly Private Interests Foundations to engage in business activities like a day to day thing. Private Foundations can own businesses and invest in stocks, funds, and other financial investments.
Anyone, from any citizenship or residence, can be named as a beneficiary of a private foundation.
Anyone, from any citizenship or residence, can be named as a protector of a private foundation.
Corporations pay an annual franchise tax of USD300.00 and Private Foundations USD400.00.
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