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Setting up a company in Panama?

Find out how to do it in a legally compliant way:

USD-based economy

No tax on foreign income

No limits on moving money abroad

Fast company setup

You can reduce your tax burden legally. We will be pleased to advise you in detail and offer a free initial consultation.

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Estimated Annual Revenue

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Pros and cons of setting up a company abroad

If you relocate your residence:

Taxation only on Panama-source income
Foreign income (earned outside Panama) is generally tax-free
Residency programmes start from a USD 200,000 investment

Without emigrating:

Generally no corporate income tax in Panama, provided no business is carried on within Panama
Dividend tax may apply on distributions, typically 5% or 10%
Opening a bank account requires a clear business purpose and complete documentation
A licensed local Resident Agent as well as annual compliance obligations are required

What makes Panama attractive as a business location?

Panama operates a territorial tax system: only Panama-source income is taxed. Foreign-source income for companies and individuals is generally tax-free.

A Panama S.A. (Law 32 of 1927) remains tax-neutral on foreign income if no local income is generated. Dividend tax is typically 5% on foreign/export profits and 10% on Panama-source profits (20% for bearer shares).

For immigration, the Qualified Investor Programme (since 2024) requires a minimum USD 300,000 real estate investment. The Friendly Nations Programme requires USD 200,000 in real estate or a bank deposit, or an economic connection.

Panama is now a regulated mid-shore jurisdiction with increased compliance and transparency. Local bank accounts are possible with proper documentation of economic purpose and source of funds.

Contact us for an individual assessment and possible alternative structuring solutions.

FAQs

Is a local managing director required?

For an S.A., there is generally no requirement to appoint a local director. However, a licensed Panamanian Resident Agent is mandatory for incorporation and ongoing compliance.

Are there many banking options?

Yes, but the compliance requirements are high. Without a clear business model and full documentation, opening an account may be delayed.

Is Panama on a blacklist?

Panama is on the EU tax list of non-cooperative jurisdictions; however, since 13 February 2026 it has not been on the FATF grey list.

How high are the tax rates?

Corporate income tax is 25% on Panama-source income. Dividend tax is generally 10% (domestic profits) or 5% (foreign or export profits).

Which locations worldwide are best suited to paying as little tax as possible?

	Tax Burden	Banking	Reputation	Bureaucracy	Legal Security	Costs
USA	21-0%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 1,900
Singapore	0%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 2,950
Hong Kong	0%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 1,900
Cyprus	15%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 1,900
Malta	5%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 2,500
Ireland	12,5%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 1,950
Trust	0%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 4,900
England	25-19%	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	5 stars 4 stars 3 stars 2 stars 1 stars	from EUR 1,000

Tax compliance in your country of residence

Your country of residence may impose tax and reporting obligations for foreign business activities and dividend income—in some cases even if profits are not distributed.

Depending on your personal situation, a suitable holding structure may be required to comply with tax rules and avoid unnecessary tax risks.

To determine which jurisdiction and structure best meet your requirements, please use the contact form and describe your plans in as much detail as possible.

Our advisers will be happy to review your case and advise you accordingly.

1.

Analyse your needs

We assess your situation to define objectives, risk tolerance, tax exposure and asset-protection priorities.

2.

Carry out a location analysis

We compare potential jurisdictions based on tax law, banking access, compliance requirements and your country of residence.

3.

Incorporate the company and, if required, establish a foundation

Open accounts and brokerage portfolios and, where needed, implement the asset management.