Key facts Panama taxation

The Republic of Panama is a presidential independent, sovereign state and a well-developed international business centre. Panama companies cannot undertake, without local regulatory approval, the business of banking, trusteeship and trust administration, insurance, assurance, reinsurance, fund management, serve as investment funds, collective investment schemes or any other activity that would suggest an association with the banking, finance, fiduciary or insurance business.

  • Standard share capital is US$10,000 divided into 100 voting shares of US$100 each
  • Minimum issued capital is either one share of no par value or one share of par value
  • Bearer shares and registered shares may be issued
  • Minimum three Directors are required of any nationality and residence
  • A President, a Secretary and Treasurer must be appointed. Directors can also serve as Officers
  • Directors, Registered agent and officers are at public records
  • Shareholders are not at public records
  • A Panamanian lawyer or law firm is required to serve as the Registered Agent


  • Panama operates a territorial tax system. Income earned from outside of Panama is not taxable
  • Corporate income tax of 25% is only chargeable on revenue arising from business activities and assets situated in Panama
  • Interest earned on bank accounts maintained in Panama by a Panama company is exempt from tax
  • VAT is charged on the supply of goods and services at a standard rate of 7%, although some goods are subject to higher rates and others are exempt