Panama Company with Residency Drawbacks?
- Thread starter nethostler
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You could have a point there, but I don't want to get into a detailed legal discussion of it not knowing anything about OP's business and where any services are delivered. I think for practical purposes, the chances of the Panama tax authority pursuing that argument against a foreigner billing everything outside Panama are one in a million. They are much more interested in checking that Chinese grocery stores are issuing valid︀ tax receipts from compliant cash registers.
No, because Panama does not make any distinctions between resident and non-resident companies (there is no IBC or offshore LLC concept) All Panama companies are considered resident in Panama by default. But, all Panama residens (whether companies or individuals) are only taxed on local source income, because that is the way the Panamanian tax system is set up.
I am glad I came across your thread, I have been researching the same topic. I'm a Canadian interested in Panama Corp + Residency.
An entity or an individual which has its activities outside of Panama will automatically escape taxation. On the contrary, an entity or an individual which engages in a business activity within Panama, receiving Panamanian source income, will be subject to pay income tax annually.
According to Paragraph 2 of Article 694 of our Fiscal Code, the income derived from the following activities is not considered from Panamanian source:
I think︆ A & B applies to most E-Commerce or Software Services where the clients or users︇ are outside of Panama. Thoughts?
An entity or an individual which has its activities outside of Panama will automatically escape taxation. On the contrary, an entity or an individual which engages in a business activity within Panama, receiving Panamanian source income, will be subject to pay income tax annually.
According to Paragraph 2 of Article 694 of our Fiscal Code, the income derived from the following activities is not considered from Panamanian source:
- Invoice, from an office established in Panama the sale of merchandises or products︀ for a higher amount of that for which such merchandises or products have been invoiced︁ against the office established in Panama, always that such merchandises or products only move outside.︂
- Manage, from an office established in Panama, transactions that perfect, consume or have effects abroad.︃
- Distribute dividends or participations of juridical persons, when such dividends or participations derive from incomes︄ that are not produced within the territory of the Republic of Panama, including those incomes︅ derived from the activities mentioned in literals a and b of this paragraph.
I think︆ A & B applies to most E-Commerce or Software Services where the clients or users︇ are outside of Panama. Thoughts?
I am still early in the process, comparing my options in Panama and UAE. Are you actually planning on moving to Panama, or will you keep your current residency?
I currently resident in Tbilisi, Georgia. But the "management of corporations" from Georgia technically make those corporations Georgian entities. This rule is not enforced, but I am evaluating options to avoid any future liabilities. Panama does seem more economical compared to UAE for forming companies and banking. I think the cost of living might be pretty much the same in both, of course, depending on your lifestyles.
You may speak with @Fred and @Gediminas to clarify the costs and more important possibilities.
Otherwise there are some interesting discussion going on inside the mentor group gold about US banking and various other banking for BVI, Puerto Rico and more.
https://www.offshorecorptalk.com/th...offer-remote-opening.30336/page-2#post-174290
Otherwise there are some interesting discussion going on inside the mentor group gold about US banking and various other banking for BVI, Puerto Rico and more.
https://www.offshorecorptalk.com/th...offer-remote-opening.30336/page-2#post-174290
Beside of the fact that Panama Banking is very difficult in 2021 as it was abused in several forms in the past and dodgy methods needs to be used nowadays to even get a Bank Account - we met a lot of people who were complaining about the Panama Residency they had in the past and that they did put a big red flag on themselfs with having a Panama Residence despite the fact that they had a reputable citizenship - many financial service provider and brokers - even IBKR that is with the enitity in the US very close located with Panama and should︀ perfectly work with the Panama based USD banking system - rejected them from the very︁ beginning or as soon as significant amount of money was transferred around without any explanation︂ given.
@bizniz @Fred I am in the process of creating a Panama Corp - it has been created and now I am looking into which corporate bank is best - the attorney has sent me two options - Banistmo and Atlas. I am doing this specifically for crypto trading/investment. I am not a resident of Panama but applying as a Canadian as a citizen but not living︀ there; I live in South Africa and Mexico.
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