Opening a company in Panama: locals, foreigners, freelancers and digital nomads

At a glance: S.A. with 10,000 dollars authorised and nothing paid in, lawyer, notary and Registro Público in about a week, territorial taxation, 25 percent corporate tax, 7 percent ITBMS from 36,000 dollars turnover, Short Stay Visa for Remote Workers for 36,000 dollars a year. Legal forms. Sole trader (persona natural with an Aviso de Operación): tax number and operation notice, no capital. Stock company (Sociedad Anónima, S.A.): three directors of any nationality, a resident agent who must be a Panamanian lawyer, authorised capital usually 10,000 dollars that need not be paid in; the standard vehicle. Limited company (Sociedad de Responsabilidad Limitada, S. de R.L.): two or more members, no minimum capital. Registration. A lawyer drafts the articles (pacto social), a notary converts them into a public deed and the Registro Público records them in 3 to 7 business days; registry fee about 60 to 100 dollars, annual franchise tax (tasa única) 300 dollars. Then the tax number (RUC) with the DGI, the Aviso de Operación on Panamá Emprende (55 dollars, same day), municipal registration and the CSS as employer. Lawyer and resident agent 1,000 to 2,000 dollars for the first year, then 400 to 800 a year plus the franchise tax; total excluding capital about 1,300 to 2,500 dollars (about 1,100 to 2,200 euros) in one to two weeks. Taxes 2026. Territorial: only Panamanian-source income is taxed; foreign-source income is exempt even when banked in Panama. Corporate income tax 25 percent; companies with taxable income above 1.5 million dollars pay the higher of that and 4.67 percent of gross income (CAIR). Dividend tax 10 percent on Panamanian-source profits, 5 percent on foreign-source or free-zone profits; undistributed profits bear a 4 percent deemed-dividend tax. ITBMS 7 percent (10 on hotels and alcohol, 15 on tobacco), registration once gross income exceeds 36,000 dollars a year. Personal rates 0 to 11,000 dollars, 15 percent to 50,000, 25 percent above (about 43,000 euros). Freelancers and the self-employed. Get a RUC from the DGI, an Aviso de Operación if the activity is commercial (liberal professions may need a Panamanian licence instead), issue electronic invoices through the SFEP and file the annual return by 15 March. Income tax at the personal rates on net income, ITBMS 7 percent above 36,000 dollars, no flat-rate regime. Independent professionals above a yearly fee threshold owe CSS contributions under Law 51 of 2005 as reformed by Law 462 of 2025; most foreign freelancers keep private health cover. Foreigners. 100 percent foreign ownership; retail trade and about 50 licensed professions are reserved for Panamanians by the Constitution. Directors and shareholders may live anywhere; the resident agent lawyer is mandatory. Residence: Friendly Nations Visa for citizens of about 50 countries through a job with a Panamanian company or 200,000 dollars (about 175,000 euros) in property or a three-year deposit, two years provisional then permanent, government fees about 1,000 dollars plus lawyer; Qualified Investor Visa with 300,000 dollars (about 260,000 euros) in property under a reduced threshold extended repeatedly (500,000 standard), 500,000 in securities or 750,000 on deposit, permanent residence in about 30 days, government fees about 5,000 dollars. Banks take 2 to 8 weeks and an in-person interview. Branch of a foreign company. A sucursal is registered at the Registro Público with apostilled proof of existence, articles, a board resolution, a resident agent and a power of attorney to a representative in Panama; it pays the 300 dollar franchise tax and gets a RUC and Aviso de Operación. Taxed at 25 percent on Panamanian-source income, with the 10 percent dividend tax on after-tax profits whether or not remitted. Foreign groups mostly form an S.A. subsidiary. Digital nomads. Yes: the Short Stay Visa for Remote Workers (Visa de Corta Estancia como Trabajador Remoto, Decree 198 of 2021) for employees of foreign companies or freelancers with foreign clients earning at least 36,000 dollars a year (about 31,000 euros), 48,000 with family, valid nine months and extendable once for nine more, government fees about 300 dollars, applied for in Panama through a lawyer with apostilled proof of income and health insurance; foreign income stays untaxed. Changed recently. Law 462 of March 2025 reformed social security with phased contribution rises; the reduced 300,000 dollar Qualified Investor property threshold extended again (2024 to 2026); electronic invoicing (SFEP) extended to all taxpayers (2024 to 2025); Law 526 of May 2026 imposes substance tests on foreign-source passive income of multinational-group entities from fiscal 2027, with 15 percent tax on failure. Figures checked October 2026 from the Registro Público de Panamá, the Dirección General de Ingresos, the Servicio Nacional de Migración, PwC Worldwide Tax Summaries and Panamanian law firms; thresholds and fees change yearly. Confirm with a licensed adviser in Panama before you file.