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Tax Engineering

Private foundation in Panama

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How can I protect my heritage? Forming an offshore foundation in Panama will grant its founder an extreme privacy and protection of his heritage.

Reference: FP78452PA


Offshore foundation in Panama

Forming an offshore foundation in Panama guarantees its founder an extreme privacy when it comes to protecting his assets. The origin of offshore foundations of private interest arise in the Principality of Liechtenstein in 1926 and its main characteristics are:

  1. It is a legal entity, a combination between a trust and a company that has no owners (shareholders, participants, or partners) but is intended to benefit a group of individuals. 
  2. The offshore foundation may have or not an office in Panama.
  3. The foundations are registered in the Panama Trade Registry, which includes the information about the Board of Directors, the promoter and the first shareholder, but not the founders.
  4. The founder, who is the maximum authority, has the following rights: to concede, to sell, to transfer or donate the goods, but not to create debts. The founder can maintain total anonymity of the beneficiaries, be the only beneficiary and avoid paying taxes to the founders or beneficiaries of the entity.
  5. Panamanian offshore foundation operates in a following way: the founder forms a foundation, for example in Panama, and transfers the assets or rights to its foundation that in its turn creates an international business company (IBC). The company (IBC) buys bearer shares in an investment fund that will pay the dividends annually to the IBC company whose owner is a foundation. In this way, the foundation will not have beneficiaries until the founder is absent.
  6. Offshore foundations registered in Panama are separate from its founders, administrators or beneficiaries. The foundations can own any property: bank accounts, real estate, investments, corporate shareholders, etc. Thanks to the bearer shares it is possible to obtain even more privacy and protection.
  7. Panamanian offshore companies, created by foundations are not subject to any type of tax: income, capital gain, withholding tax, invention tax, interest tax, property sales tax, equity transfer, property tax, inheritance, inventory.

Advantages of creating an offshore foundation in Panama

  • They are not subject to taxation.
  • They are anonymous.
  • There is no penetration of the corporate veil as long as it develops legal activities.
  • Panamanian foundations do not require high social capital.
  • Panamanian foundations can operate all over the world and open an account in any country in its name. Also they can own real estate, investments, corporations, trusts or any other assets.
  • The maintenance of a Panamanian foundation is very economical.
  • Panamanian foundations can be used for the following: purchase of shares of several companies, investment in funds, purchase of bonds, creation of non-profit non-governmental organizations and non-profit organizations for charity and health organizations.

Characteristics of offshore foundation in Panama

General information
Type of companyFoundation
Type of lawsCivil law
Limited LiabilityYes
Foundation constitution time2 weeks
Government feesUS $ 300
Change in allowed residenceYes
Social capital of the Panamanian foundation
CurrencyUS $
Allowed currenciesAll
Minimum capitalUS $ 10,000
Authorized capitalUS $ 50,000
Council Members and Protectors
The ProtectorOptional
Corporate guard allowedYes
Minimum of Council members3
Allowed corporate board memberYes
Meeting placeEveryone
Records accessible to the public
Founding ActYes
Foundation RegulationNo
Name of the FounderYes
Local requirements of the Panamanian foundation
Registered AgentYes
Language of the Founding ActOptional, but translation is required
Language of the Foundation RegulationOptional, but translation is required
Accounting and audits of the foundation
Mandatory accounting preparationYes
Mandatory auditOptional

* Offshore foundation in Panama with bank account in the name of the foundation no physical presence in the country. All procedures will be carried out through E-mail and / or certified mail.

    in Panama
    notarized and apostilled in Spanish and English
    to give more privacy
    notarized and apostilled
    in the name of the foundation with 24-hour online banking included
    in the name of the company
    for 1 year
    for 1 year
    for 1 year
    for 1 year
    1295 euros (or equivalent in another currency)
    to any part of the world
    Certified by a notary or notary public
    Certified by a notary or notary public
    Electricity, water, gas, telephone or bank statement
    in English
    Business letter of recommendation from a lawyer, accountant or tax advisor

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