How do I start a business in Panama?
Col Davis Stevenson RET
Starting a business in Panama is relatively inexpensive. One can set up a corporation for under $1,000 by using the right lawyer. There are restrictions on what type of business a foreigner can operate; your attorney can fill you in.
If you are going to go in business in Panama you should become familiar with the Panama Labor Code. You have to apply for a business license "Patente" if you are going to operate a retail business. Also, opening a bank...
Starting a business in Panama is relatively inexpensive. One can set up a corporation for under $1,000 by using the right lawyer. There are restrictions on what type of business a foreigner can operate; your attorney can fill you in.
If you are going to go in business in Panama you should become familiar with the Panama Labor Code. You have to apply for a business license "Patente" if you are going to operate a retail business. Also, opening a bank account can be a challenge due to the strict banking laws.
If you do not want to go to the expense of renting an office or a facility you can always use the services of companies that rent time and space.
Another item that you should become familiar with is the tax code in connection with a national business and an international business. It is suggested that you consult an attorney. There are many well qualified and not too expensive attorneys in Panama.
Finally, you an set up a business by making a dollar investment into Panama as a Pensionado.
Posted April 17, 2013
Roy Cannon - Gestoria Cocle - main office in Penoneme
There are a number of Investor Visa categories that will permit you to work in your own company, doing any business that is not restricted by law (medicine, law, driving a taxi/bus, and running a retail shop are a few). There are two pieces to the puzzle: the resident visa and the company. You can choose to invest in an existing business or form a new company, and if you structure things correctly you will not need a work permit nor will you have to pay social security...
There are a number of Investor Visa categories that will permit you to work in your own company, doing any business that is not restricted by law (medicine, law, driving a taxi/bus, and running a retail shop are a few). There are two pieces to the puzzle: the resident visa and the company. You can choose to invest in an existing business or form a new company, and if you structure things correctly you will not need a work permit nor will you have to pay social security (unless you want to in order to qualify for Social Security Health Services).
There are some things to be considered when going the company formation route, the chief of which is that "generally" you are expected to employ three Panamanian workers, paying at least minimum wage (less than $500 a month) and the number of foreign workers is "generally" limited to being 10-15% of the total work force.
The Annual franchise fee (called Tasa Unica) and your annual CPA certified tax returns, together with any legal services you agree with your law firm, start around $500 a year, but will vary with your circumstances and business volume.
There are several "special" zones and activities that offer exemption from some of the requirements and taxes. Ask your legal team for more information.
To start off fresh you can budget around $2,500 for a visa and company, depending upon your personal circumstances and nationality.
Posted May 10, 2013
Vannessa Solano
Panama is a very good place for people to be successful financially because Panama is growing, and things are dynamic, as opposed to in other countries, where things don't change much.
In Panama there are more opportunities to solve problems that are just being addressed in Panama that have already been addressed elsewhere.
In addition, in Panama, compared to these other more developed and static places, it is less expensive to start and run a business, with lower...
In Panama there are more opportunities to solve problems that are just being addressed in Panama that have already been addressed elsewhere.
In addition, in Panama, compared to these other more developed and static places, it is less expensive to start and run a business, with lower...
Panama is a very good place for people to be successful financially because Panama is growing, and things are dynamic, as opposed to in other countries, where things don't change much.
In Panama there are more opportunities to solve problems that are just being addressed in Panama that have already been addressed elsewhere.
In addition, in Panama, compared to these other more developed and static places, it is less expensive to start and run a business, with lower costs for rent, salaries, etc.
In Panama there are more opportunities to solve problems that are just being addressed in Panama that have already been addressed elsewhere.
In addition, in Panama, compared to these other more developed and static places, it is less expensive to start and run a business, with lower costs for rent, salaries, etc.
Posted June 30, 2014
David Whittington - Tucan Golf Club and Resort
Many expats come to Panama and start a business on the side, without any problem. Others buy a business like a small farm, where they can grow and sell their own coffee. Others have arts and crafts businesses, whether as a hobby or to subside their income.
Many businesses can be started by expats without any problem. There are, however, exceptions. For example, if you want to open a restaurant that serves alcohol, you’ll need a Panamanian...
Many businesses can be started by expats without any problem. There are, however, exceptions. For example, if you want to open a restaurant that serves alcohol, you’ll need a Panamanian...
Many expats come to Panama and start a business on the side, without any problem. Others buy a business like a small farm, where they can grow and sell their own coffee. Others have arts and crafts businesses, whether as a hobby or to subside their income.
Many businesses can be started by expats without any problem. There are, however, exceptions. For example, if you want to open a restaurant that serves alcohol, you’ll need a Panamanian partner. The reason is that, as a foreigner, you can’t have a liquor license. There are also restrictions in the real estate business and in other select businesses, as well.
Many businesses can be started by expats without any problem. There are, however, exceptions. For example, if you want to open a restaurant that serves alcohol, you’ll need a Panamanian partner. The reason is that, as a foreigner, you can’t have a liquor license. There are also restrictions in the real estate business and in other select businesses, as well.
Posted July 17, 2014
Roberto Diaz - United Country Panama Coastal Real Estate
Foreigners can start businesses in Panama, but of course, they have to be in the country legally. After that, some visas will allow you to start a business and / or work in Panama, and some will not. For example, there are many restrictions on what you can do if you have a retired person’s visa.
If you have the proper visa, there is no difference between you as a foreigner starting a business in Panama and a Panamanian...
Foreigners can start businesses in Panama, but of course, they have to be in the country legally. After that, some visas will allow you to start a business and / or work in Panama, and some will not. For example, there are many restrictions on what you can do if you have a retired person’s visa.
If you have the proper visa, there is no difference between you as a foreigner starting a business in Panama and a Panamanian citizen starting a business. You do, however, have to be concerned with are the laws about the ratio of the quantity of foreigners working in your business compared to the quantity of Panamanians. For example, if you were to open a McDonald’s, you could work in it and be the general manager, but you would have to employ a certain quantity of Panamanians for every foreigner working there.
In addition, there are certain industries in which you can’t start a business until you’ve been in the country a certain number of years. For example, as a foreigner, you can’t open a real estate sales company right away. (However, there are lots of people who do it illegally.)
If you want to legally open a business in one of the industries where you have to be in Panama for a certain period of time (once again, for example, the real estate business), you could partner with a Panamanian, and that would be acceptable.
Posted August 17, 2014
Sieg Pedde - Helix Courier Limited
If you are planning to start your own business in Panama, you have to decide first whether it’s going to be a proprietorship or a corporation. Then, you’ll going to need a lawyer. Getting your own personal lawyer is very important because there are some legal issues that you can’t handle on your own, most especially if you are in a foreign country. You have to follow the local labour laws because there are certain things that you are prohibited from doing if...
If you are planning to start your own business in Panama, you have to decide first whether it’s going to be a proprietorship or a corporation. Then, you’ll going to need a lawyer. Getting your own personal lawyer is very important because there are some legal issues that you can’t handle on your own, most especially if you are in a foreign country. You have to follow the local labour laws because there are certain things that you are prohibited from doing if you’re not a citizen of the country. Although you can just go to numerous websites that specialize in this sort of thing, it will be easier and more effective to pay a visit to a local lawyer’s office and ask for assistance since they are the experts in this field.
Posted September 1, 2014
Jose Broce - Broce-Pinilla & Asociados
It is very easy to start a business in Panama. Your first task is to decide what type of business you’re going to start. Then you talk to a lawyer to set up a corporation to develop that business. The consultation with the lawyer normally takes between two to three hours.
For your Board of Directors, you will need three people, who can be from any country in the world.
Your...
It is very easy to start a business in Panama. Your first task is to decide what type of business you’re going to start. Then you talk to a lawyer to set up a corporation to develop that business. The consultation with the lawyer normally takes between two to three hours.
For your Board of Directors, you will need three people, who can be from any country in the world.
Your attorney should take about half of a day to get the paperwork ready to submit to the Registrar Publico. The fees for the Registrar Publico are around US $1,500. In three to four working days, you will have your corporation established. So, in about 7 working days total, you can have your corporation legally established in Panama.
Then, you will need an office, which could be a virtual office. For example, a lawyer could allow you to use his address.
About a year and a half ago, it became necessary (with a few exceptions) to run all your invoices through an “impresora fiscal”, which creates a serial number for each invoice and is connected to the Panamanian government. To get this machine takes about another four working days. So, within 15 days or so to a month, you will be able to be a fully functional business. The only thing that may take more time would be setting up the corporation’s bank account. However, you can use your existing US or other bank account while your bank account in Panama is being set up.
There are a few restrictions as to the type of business you could start in Panama as a foreigner. For example, if you were a lawyer, you would have to go through university in Panama. Of course as a doctor, you would have to have a Panamanian license.
As another example, ownership of real estate sales firms are restricted to Panamanians. However, there are ways as a foreigner to set up a company to advise the real estate sales firm, instead of acting as a broker. There are other examples as well.
Relative to hiring employees, the labor laws in Panama are very strict. These laws protect the employee, but also, if the employer properly complies with the labor laws, they protect the employer as well. As an employer, you must set up the contracts properly in the beginning. Otherwise, the employees will have the advantage.
If you set up your labor contracts properly, you will be able to enjoy the benefits of much, much lower labor costs in Panama. For example, the minimum wage is about $400 / month and highly trained people get paid between $2,000 to $4,000 per month, which is considered a good salary, because in Panama, with this salary, you can have a good life.
As a corporation in Panama, you pay a flat corporate fees annually called “tasa unica” of $350. Plus, you will need to pay an agent resident, which is a legal fee because each corporation has to have a lawyer as part of the corporation. This will cost you between $250 - $350, depending on what you agree with the law firm.
Posted September 2, 2014
Randy Hilarski - High Impact Media Group Panama
We have been in business in Panama for almost 4 years. Since we are an online business we have not yet incorporated, but that is a part of the plan in 2015. Incorporation only costs $800-$1200 depending on the lawyer.
There are many regulations for owning a business in Panama. Research the type you would like to open and see what the requirements are.
I can only comment on owning an online business in Panama. If you are American it is...
We have been in business in Panama for almost 4 years. Since we are an online business we have not yet incorporated, but that is a part of the plan in 2015. Incorporation only costs $800-$1200 depending on the lawyer.
There are many regulations for owning a business in Panama. Research the type you would like to open and see what the requirements are.
I can only comment on owning an online business in Panama. If you are American it is best to set up Paypal and get the Paypal Business debit card before coming to Panama. It is super convenient.
Working with Panama companies as clients can be a challenge. Many require that you have an official government receipt (factura fiscal). We have worked around it with many clients, but it would be much easier if we were incorporated.
I hope you have a great experience in this beautiful country. Panama is amazing!
Posted January 5, 2015
Michael A. Martinez - B & B Real Estate Nicaragua / Panama Real Estate Information
Starting a business in Panama depends on what kind of business you want to have. For example, it would be different starting a real estate business than some other business that we have here in Panama. It also depends where you’re doing your business. If it is in a small town, the mayor’s office already has the Department of Health and the Department of Industry and Commerce. For example, my guys went to the mayor’s office and they were...
Starting a business in Panama depends on what kind of business you want to have. For example, it would be different starting a real estate business than some other business that we have here in Panama. It also depends where you’re doing your business. If it is in a small town, the mayor’s office already has the Department of Health and the Department of Industry and Commerce. For example, my guys went to the mayor’s office and they were given what they needed to open a restaurant, including a liquor license.
Basically a foreigner is entitled to open a business just like the residents. If you want to open a small business and you have a certain number of employees, you’re entitled to residency benefits. Panama has the red carpet for foreigners who want to open businesses. It is a good time to start a business in Panama. We have a Friendly Nations Visa and Economic Visa for business and investment.
If you want to start a business in Panama, get a good consultant and discuss what kind of business you want to have. There would be questions, big or small, about the business, whether you are in an existing company in the United States that wants to cash in on the free trade zone or whether you are looking to lower your labor cost. There are lots of good government officers in Panama willing to give you information if they don’t already have it online or on brochures. They’re really promoting business in Panama right now.
It is a lot easier to start a business in Panama than start a business in Santa Monica, California. In Santa Monica, you have so many different taxes and hoops you have to jump through. In both countries, you need to have the approvals from the health department and the fire department. For example, in Panama, if you are running a restaurant, you can have professional companies do the work for you. Specifically, the gas company is a private company and they sell the equipment for our restaurant. We strictly do business with them and they are certified. We show the Health Department the certificate of the gas company and the Health Department doesn’t even have to come up and check our restaurant.
In Santa Monica, California, however, you have to get an inspector from every department for every aspect of your business so there is more red tape. Not only do you have to deal with your professional licensed person, construction and installation teams, you also have to deal with the government.
In Panama, you can deal with all the professionals and get stamps of approval if you have the right letters from the right subcontractors. It’s a lot easier to start a business in Panama. If I were to start a real estate business in California, I have to go through a lot of schooling and go through other hoops. In Panama, the corporation hires the real estate broker and invites him to be on the Board and become the legal representative. The corporation can work under the real estate license with the right connections and the right license broker. You could be in business in a week.
It is a lot easier to start a business in Panama than start a business in Santa Monica, California. In Santa Monica, you have so many different taxes and hoops you have to jump through. In both countries, you need to have the approvals from the health department and the fire department. For example, in Panama, if you are running a restaurant, you can have professional companies do the work for you. Specifically, the gas company is a private company and they sell the equipment for our restaurant. We strictly do business with them and they are certified. We show the Health Department the certificate of the gas company and the Health Department doesn’t even have to come up and check our restaurant.
In Santa Monica, California, however, you have to get an inspector from every department for every aspect of your business so there is more red tape. Not only do you have to deal with your professional licensed person, construction and installation teams, you also have to deal with the government.
In Panama, you can deal with all the professionals and get stamps of approval if you have the right letters from the right subcontractors. It’s a lot easier to start a business in Panama. If I were to start a real estate business in California, I have to go through a lot of schooling and go through other hoops. In Panama, the corporation hires the real estate broker and invites him to be on the Board and become the legal representative. The corporation can work under the real estate license with the right connections and the right license broker. You could be in business in a week.
(Juan Carlos Navarro, district mayor of Panamá, pictured.)
Posted April 28, 2015