Panama Company Formation

You can form a company in Panama under Law 32 of 1927 to obtain a classic, time-tested corporate vehicle with modern compliance features. A Panama corporation (Sociedad Anónima) combines 0% tax on foreign-source income, flexible corporate governance, and a stable offshore jurisdiction that follows current AML and reporting standards, and these are just the most striking benefits.

With QWealth, Panama company registration is handled end-to-end: from choosing the right type of company and drafting the articles of incorporation to coordinating bank onboarding, accounting, and annual renewals. The goal is to form a clean, compliant structure with benefits that you can conveniently use.

Before starting a business in Panama, always confirm your personal situation with a qualified advisor.

Why Panama? Strategic Advantages for Global Business

Panama boasts a strategic location at the crossroads of the Americas, with the Canal, a diversified service economy, and a strong banking cluster along both the Caribbean and Pacific Ocean coasts. For many entrepreneurs, the location remains one of the most practical places for offshore companies and international holdings.

Key advantages of a Panama offshore company:

• Territorial tax system: foreign-source income is not subject to Panamanian corporate income tax.
• Predictable company law based on Law 32 of 1927: clear rules on directors, shares, members, meetings, and records.
• Established professional sector: licensed registered agents, law firms, and corporate service providers.
• Developed banking and payments infrastructure for cross-border business activities.

If you’re starting a business in Panama as a foreigner, the framework is built precisely for international owners.

The Territorial Tax System Explained

Panama uses a territorial tax system:

• Income generated outside Panama is generally not taxed locally.
• Income from Panamanian sources (local sales, local services, local real estate) is subject to standard corporate taxes.

For a typical Panama company used as a holding or trading vehicle with non-Panamanian clients, this can mean a 0% effective corporate rate in Panama, while you remain responsible for declaring income and paying taxes in your country of residence if required.

This makes company formation in Panama attractive for:

• Digital businesses serving foreign markets
• International consulting and professional services
• Holding of securities, IP, and other foreign assets

Financial Privacy, UBO Registry & Compliance

Panama has moved away from the old “secrecy only” model and now focuses on regulated privacy:

• Directors of a corporation are recorded in the Public Registry, while the shareholder register and beneficial owner data are kept by the registered agent and in the private UBO system, not in public records.
• A confidential Ultimate Beneficial Owner system exists so authorities can access data when legally required, but it is not open to the general public.
• Banks and registered agents must apply strict KYC under local AML rules and international standards.

This balance gives you meaningful confidentiality for legitimate business in Panama, while still complying with global information exchange mechanisms.

Panama vs. Other Jurisdictions

Compared with destinations like the BVI, Belize, or Delaware:

• Like other classic offshore centers, a company in Panama can enjoy 0% tax on foreign income, but with a larger domestic economy and more developed local banking.
• Compared with US states such as Delaware, the link between Panama company formation and territorial taxation is clearer and more traditional.
• Unlike some small island centers, Panama has its own real infrastructure, legislation, and long corporate history under Law 32 of 1927.

For founders who want both an offshore jurisdiction and a real economic environment, Panama is often the middle ground.

Our Panama Company Registration Packages

Transparent pricing, no hidden compliance fee, and a clear scope of services. Choose a package depending on whether you need pure holding, banking, or full nominee support.

Types of Legal Entities in Panama

Before you choose a bank or sign any contracts, it’s crucial to understand which type of legal entity in Panama fits your goals — and in most cases, that starting point is the classic Panama Corporation (Sociedad Anónima).

The Panama Corporation (Sociedad Anónima)

The S.A. is the classic Panama company created under Law 32 of 1927:

• Separate legal entity with limited liability for shareholders
• Flexible share structure; ownership proved by share certificate and registers
• Board managed by at least three directors (individuals or legal entities, any nationality)
• Suitable for trading, holding, IP, ships, and other international projects

When people talk about Panama company formation, this is usually what they mean.

Panama Private Interest Foundation

A Private Interest Foundation is not a company, but a hybrid between a trust and a legal person:

• Designed for asset protection and estate planning
• Holds shares of offshore companies, portfolios, and other assets
• Allows separation of control (foundation council) and benefit (beneficiaries)

Foundations are often combined with a Panama corporation in long-term wealth planning.

Limited Liability Company (S. de R.L.)

The S. de R.L. is a member-based entity:

• Ownership based on quotas (interests), not shares
• More “partnership-like” than a corporation
• Used in joint ventures and smaller operating structures

For most international clients, however, the S.A. remains the primary company in Panama.

Requirements for Panama Company Registration

Before we move to directors, shareholders, and banking, let’s start with the basics: your company name and the correct Panamanian suffix (Corp, Inc., or S.A.) are the first formal requirements you’ll need to meet.

Company Name & Suffixes

Your name must be unique and end with an accepted suffix:

• “Corp”, “Inc”, or “S.A.” (or full equivalents such as “Corporation” or “Sociedad Anónima”).

We register and reserve the name before drafting documents, so there are no conflicts in the public registry.

Directors & Officers

Under Law 32, each S.A. must appoint at least three directors:

• They can be individuals or entities, of any nationality, resident or non-resident.
• Their names appear in the public file; nominee directors are often used for privacy.

Officers (president, secretary, treasurer) are usually appointed from among the directors.

Shareholders & Share Capital

A typical company formation in Panama uses:

• Authorized capital of USD 10,000, divided into shares (no need to fully pay up at formation).
• Flexible share classes if required by your structure.

Ownership is tracked via company documents and internal registers, not public filings.

Registered Agent & Office

Every Panama company must have:

• A licensed registered agent (usually a law firm)
• A registered office address where official notices are served

The agent keeps key documents (including accounting information and UBO data) and is central to ongoing compliance.

Step-by-Step Incorporation Process

Once you’ve settled on the right structure, the incorporation process itself is straightforward — it begins with reserving your chosen name and passing a basic KYC check.

Step 1: Name Reservation & KYC Check

We confirm your preferred name, run a check in the public registry, and perform initial KYC in line with local AML law and your risk profile.

Step 2: Drafting Articles of Incorporation

Our legal team prepares the articles of incorporation, stating:

• Company name and purpose
• Share capital and classes
• Names and details of initial directors
• Registered office and registered agent

Step 3: Registration in the Public Registry

The incorporation deed is notarized and filed:

• Government fees and stamp duties are paid
• The Panama company is created as a legal entity
• You receive the certificate of incorporation once recorded

Step 4: Obtaining the RUC (Tax ID)

We apply for your RUC (tax identification number):

• Necessary for basic registration with the tax authority
• Required even if all income will be foreign-source

Step 5: Corporate Kit & Apostille Delivery

You receive a complete corporate kit:

• Original and apostilled company documents
• Share certificate and internal registers
• Corporate seal, resolutions, and standard forms

Everything is delivered by courier, so you can start the business immediately.

Required Documents

To comply with Panama’s strict AML standards and international expectations (including FATCA/CRS), we require a basic but complete KYC pack.

For Individual Directors & Shareholders

• Passport copy (color, valid)
• Proof of address (utility bill or bank statement, usually not older than 3 months)
• Bank or professional reference
• Short CV detailing experience and planned business activities

For Corporate Shareholders

• Certificate of incorporation
• Memorandum & Articles/bylaws
• Register of Directors/Members or shareholders
• Recent certificate of good standing, if available

Proof of Income & Source of Funds

For the company and for bank account onboarding:

• Tax returns or financial statements
• Bank statements confirming the origin of funds
• Simple narrative explaining the activity and counterparties

This is crucial for starting a business in Panama the right way. Clean, consistent documents save weeks at the bank and at the compliance level.

Discuss the details with an expert

Check the list of required documents, and get the details of the process, terms, and costs.

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Compliance: Accounting, Law 52, FATCA & CRS

Modern Panama company registration also means accepting ongoing compliance duties.

• Under Law 52 of 2016, Panamanian entities must maintain basic accounting records and supporting documents (contracts, invoices, bank statements, and similar) and keep them for at least five years.
• These records may be stored outside Panama, but the registered agent must know where they are kept and be able to obtain copies within a reasonable period if requested by the authorities.
• Banks and other financial institutions in Panama apply international FATCA and CRS standards, which can result in information about your Panama company’s accounts being reported to the tax authorities in your country of residence.

Using a Panama offshore company does not cancel your obligations at home. It simply gives you a flexible, clearly structured legal entity to manage cross-border business.

Costs & Fees: Detailed Breakdown

When planning your Panama structure, it’s important to separate what you pay to the state from what you pay your service provider — in other words, to clearly distinguish government fees from agent fees.

Government Fees vs Agent Fees

Typical components:

• One-off government fees and stamp duty at incorporation
• Annual franchise tax (Tasa Única) for the corporation
• Professional fees for the agent, registered office, and advisory services

Your total cost depends on whether you choose the Standard, Professional, or Premium package and whether you add nominees or extra legal opinions.

Annual Renewal Requirements (Tasa Única)

To remain in good standing, a company in Panama must:

• Pay the annual Tasa Única on time
• Keep a registered agent and registered office active
• Maintain basic accounting records and resolutions

Failure to comply can lead to fines, suspension, and expensive reinstatement.

Opening a Bank Account for a Panama Company

Once your corporation is in place, the next practical step is to make it bankable, which starts with choosing the right partner from the banks we work with on a regular basis.

Banks We Work With

We help match your Panama company to banks or fintech institutions that understand offshore companies:

• Panamanian banks for local presence
• Regional banks for USD and multi-currency accounts
• International EMIs for online operations and card issuance

Different institutions have different requirements and risk appetites.

Remote Opening Possibilities vs Physical Visit

In practice:

• Some banks still prefer a physical meeting with at least one director.
• Others support remote onboarding for well-documented clients with clear business activities and transparent documents.

We prepare the full banking file so the process is structured and predictable.

Additional Services

Beyond basic incorporation and banking, many clients also need an extra layer of privacy and flexibility — this is where nominee directors and shareholders become a powerful tool.

Nominee Directors & Shareholders

Nominee members help when you want:

• Extra confidentiality in public records
• More distance between you and your operating company

All arrangements are documented via powers of attorney and internal resolutions so control remains with you.

Virtual Office & Mail Forwarding

Beyond the statutory registered office, you can opt for:

• A business address in Panama City
• Mail scanning and forwarding
• Optional call handling

Legal Opinions & Good Standing Certificates

We can also prepare or obtain:

• Legal opinions on legislation, tax, or regulatory status
• Certificates of good standing and status reports for partners and banks

Why Choose QWealth for Incorporating Your Panama Company?

Choosing the right advisor for Panama company formation is just as important as the jurisdiction itself. Your provider should not only form a structure, but also guide you through Law 32, Law 52, Law 129, and international reporting standards so the company remains fully usable and compliant.

• Direct Access to the Panama Public Registry. We work through trusted licensed agents with direct electronic access to the Panama Public Registry. This speeds up name checks, registration, and updates to directors or shareholders, reducing the risk of delays and rejected filings.
• Full Compliance Guarantee. Our team designs every Panama corporation to respect local rules on accounting records (Law 52), UBO registration (Law 129), and AML/KYC requirements, while also taking FATCA/CRS into account. We help you keep the right documents, update beneficial ownership information on time, and maintain good standing year after year.
• No Hidden “Compliance Fees”. All mandatory government fees, agent fees, and optional services are disclosed before you sign. You see exactly what is included in each package, with no surprise “compliance extras” appearing after incorporation or at renewal.

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