Tax Considerations when Offshore Banking in Panama

Learning about the tax aspect of offshore banking in Panama is very important. When looking to place your assets offshore for increased protection, there are many aspects to take into consideration. The following are some pointers about taxation in Panama.

Foundations are not taxable in Panama. Foundations have a $250-$300 annual renewal fee, and that is it. The banks may charge a service charge, but that is not tax related. When the foundation owns a corporation and that corporation has income, as long as that income is not generated in Panama, it is not taxable. There is no capital gains tax for foundations. In the event of death there is no inheritance tax or estate taxes for the beneficiary of the foundation.

With a bearer share corporation there are a few different aspects to look at. For instance, there is also an annual government fee. The annual fee for corporations is $300. Again the banks charge service charges but that is not tax related. Income of the corportation is not taxable if it has been generated outside of Panama.

This is written in Section 701(e) of the Panama tax code; "profits derived from the sale of Corporate shares and personal property are taxable income...the taxpayer will be subject to Capital Gains tax at a fixed rate of 10%". Regular income of the corportation is not taxable if it has been generated outside of Panama.

When looking to place your assets offshore for increased protection, there are many aspects to take into consideration. Learning about the tax aspect of offshore banking in Panama is very important. Make sure you are informed.

About the Author

William writes regularly about asset protection in Panama through corporations at the OffshoreLegal website. Get your own completely unique content version of this article.

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