A Corporation is defined as a stock company with its capital divided into shares, whether in the form of par value or bearer shares, following the principle of the limited liability of the partners towards the company, which carries out a commercial activity. This type of company is known in Spanish as “Sociedad Anónima” – “S.A.”, “Inc.” or “Corp.” Which means “joint-stock companies” “Private Limited Companies” or “corporations”. In Panama, Corporations are the most common type of companies used to carry out different types of commercial activities offshore and onshore, to keep or manage assets, and for asset purchase.

One of the most common uses for a Corporation in Panama, is as a Holding company to maintain assets, have trademarks, copyrights and other intellectual property rights. Also, to participate in activities that do not require a mandatory physical presence such as consulting companies, maritime companies, offshore manufacturing companies, online companies, Start-Ups, App and Software development, air transport companies, companies that grant licenses, small companies, family businesses, among others.

Panama is an excellent commercial hub for import/export, oil and mining offshore activities. The country has the largest free trade zone in America (the Colon Free Trade Zone) that grants complete tax exemption.

Panamanian Corporations are subject to a territorial tax:

The regime which only requires them to pay taxes for operations performed within the territory of the Republic of Panama is denominated Territorial taxes. This means, that any other operation that is carried out, executed or has effects abroad, is defined as an “Offshore” operation which is fully exempt from taxes in the Republic of Panama, even if the operation is directed from an office located within the Panamanian territory.

To understand the tax regime applicable to “offshore” companies in your country, we advise that you consult with a specialist who will provide information related to your local obligations. At Gomez Tomiczek International Group we would like to inform our investment clients that the responsibilities associated with complying with their legal and tax obligations in their country of origin or where an obligation may be taxable, belongs solely to them; therefore, obtaining specialized counsel may be advisable.

Feel free to email us if you have any further questions. We will be pleased to assist you and guide you through the process of incorporation of your Corporation in Panama and any related services.


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