Immigration

Panamá is a great place to live, and has very attractive permanent residency permits for pensioners and investors. 

PLEASE NOTE:

• All permanent permit applications must be made through a Panamanian lawyer. 

• An evaluation of your individual case may be necessary to determine the permit most suited to your circumstances. 

GENERAL RESIDENCY REQUIREMENTS

• Generally, there is no age requirement minimum or maximum for applying for any residency permit, save for the minimum legal age of 18 years. Youngsters under 18, will qualify for a visa as dependents of their parents.

• All overseas documents to be presented to the authorities in Panama must be authenticated.  We can guide you as to how to comply with these requirements.  Please contact us 3 months before your expected trip to apply for residency. .

• All documents must be fresh (within 5 months of visa application) and passports must have at least 1 year to run.

• Dependents: If your spouse is to be covered by your residency visa, you need to bring duplicate original of Marriage Certificate. If your children (under 18), are to be covered by your residency visa, you need to bring duplicate originals of their Birth Certificates.

• None of these residency permits grant work permits, unless specified otherwise.

• All residency permits require that you obtain in Panama a health certificate. We will assist you with this, as part of the application process.

• All residency permits require that all applicants over 18 years old bring a clean, national police record of your last place of residence (FBI report for U.S. citizens or residents, RCMP for Canadians).

• All applications require 6 passport-size photos (gentlemen in suit and tie; ladies in blouses or dresses with sleeves – no hats or scarves).

• For specific additional requirements of each residency permit, please contact us.

PENSIONER VISA

This residency permit is designed for persons who are receiving a pension from a Government entity or private corporation of $1,000 or more. It allows you to start a business in Panama, but it does not allow you to apply for a work permit.  Granted permanently after one application. 

It includes benefits such as a discount every two years of import duties for the importation of a car (sales tax still applies). All other discounts normally associated with the Pensioner permit, will apply to any resident of Panama (under any permit) once they reach the age of 60 for men and 55 for women. 

FRIENDLY NATIONS VISA:  APPLIES TO CITIZENS OF 50 COUNTRIES ONLY (INCLUDING US, UK, CANADA - CONTACT US FOR THE FULL LIST)

This residency permit is designed for persons who are not yet receiving a pension and wish to either invest in real estate, open a 3-year fixed term account or accept employment with a corporation operating in Panama.    The minimum investment for real estate or the 3-year fixed term deposit is of US$200,000.

The permanent residency is granted after 2 applications.  After the first application you get a provisional 2-year visa and after that you have to apply for permanent residency. 

OTHER RESIDENCY VISAS

Other residency visas include but are not limited to Qualified Investor Visa, “Person of Means” (Solvencia Económica Propia), Professional Visa, Business Investor Visa and Forestry Investor Visa.  For more information on specifications and requirements for other visas, please contact us at info@mata-kelly.com

Real Estate

You may want to purchase real estate property in Panama and we may assist you on the whole process in order for you to ensure that you are acquiring proper title and are in compliance with local regulations.

• Real estate transactions in Panama are normally done in two steps: First you sign a Promise to Purchase and Sale Agreement and a down payment is given to the Seller as evidence of your commitment. If you decide not to proceed with the purchase, this down payment is normally relinquished to the seller. After the agreed time, the final Contract is made in the form of a public deed and registered at the Public Registry of Panama. As of the time of the registration, you become the owner. By far the safest possible way to pay the remainder of the purchase price to the seller is by an irrevocable letter of payment issued by a bank. The bank holding the funds issues the irrevocable letter of payment to the seller and pays it as soon as it is presented with the registered public deed transferring title to the buyer.

• Unless specifically agreed otherwise, the seller pays the transfer tax (at 2% of the sales price or the updated value of the property, whichever is higher) and advance to capital gains tax (at 3% of the sales price or the updated value of the property, whichever is higher) and the buyer pays for the legal and registration costs.

• Annual Property Tax: An annual property tax is levied on all real estate properties in Panama (both land and improvements), under two rate scales. One scale that at .7% for main residences and another scale that tops at 1% for second homes, rental property, vacant land or commercial property. Contact us for more details.

• There may still be properties enjoying property tax exemption on the structure (land above $30,000 always pays tax).  The land portion of a condo does pay 1% property tax during such time as the condo is exempted.

• Rights of Possession: You may find property in Panama, especially in rural areas, that does not have title but is held under rights of possession, which are a type of squatters rights. Although in some cases rights of possession may be converted to title, this is a lengthy process which may be subject to litigation from persons who deem have a better right.

• We do not recommend the purchase of rights of possession. We recommend titles are searched before your sign any contracts or hand over any funds. The best way of knowing if a property is titled is to request that the seller gives you the registration details of the property (Finca, Folio or lot number and other data). We may carry out a search for you to determine if it is indeed registered.

Bank Accounts

Panama's banking system is very well-regulated. Only institutions that hold a valid license with the Banking Superintendent’s Office are allowed to carry on banking business in Panama. Savings & Loans Coops (also loosely called Credit Unions) are not regulated by the Banking Superintendent's Office.

• Although Panama has banking secrecy rules, the banks will disclose information to the Financial Analysis Unit regarding transactions over $10,000 in cash and suspicious transactions. Our laws and regulations on money laundering are strictly enforced and the use of the financial center for moving or keeping proceeds from crimes related to drug trafficking, terrorism, arms trafficking, trafficking in human beings, kidnapping, extortion, fraud, tax evasion and other serious crimes is considered money laundering and subject to harsh punishment. Also, due to Tax Treaties signed by Panama, banks may have to disclose information at the request of the Government of Panama to comply with treaty requirements.

• The above has resulted in the banks exercising special care when opening bank accounts, both for local and foreign nationals and implementing a strict know-your-client policy. Therefore, even if you open an account through a Panamanian or foreign corporation, you will be required to provide to the bank information and documents of the beneficial owner of the corporation (or private interest foundation), as well as information and documents on any signatories in the account. We do not act as signatories for our clients' accounts.

• Once you choose a particular bank, we will let you know their requirements. And we will assist you by accompanying you to the bank and introducing you to the banking officer, completing the bank account opening form and obtainment of any corporate document necessary in those cases where a Panamanian corporation is opening the account. However, please understand this is a service we offer you in complying with the account opening process, we are NOT a bank NOR do we provide banking services ourselves, and it is the compliance officer of the bank you choose, the one who will ultimately approve the account, request further documentation or decide against opening the account.

Corporations

Panama has a territorial tax system, whereby only income generated in Panama is taxed and this applies to residents or non-residents, to corporations operating in Panama or overseas. Thus, corporations are not liable for income tax in Panama, unless they actually generate income within Panamanian territory. Interest from bank accounts are not considered taxable income in Panama.

• The corporation will be registered within three to five days of checking availability of your chosen name.

• Panamanian law requires three Directors of any nationality, who may be corporate entities. The full names of the Directors (no initials) and their addresses (home or office) must be submitted, together with incorporation details in the case of corporate directors.

• It is required to have at least a President, Secretary and Treasurer, who may be the same as the Directors. We do not provide nominee Directors, full responsibility for the company lies with the beneficial owners and a liability release form would have to be completed.

• Though bearer shares are still permitted, they must be placed in custody with the corporation’s lawyer or with a bank, who must sign custody documentation..

• The names of the corporation’s beneficial owners is recorded in a closed registry where only specific government authorities have access.  This information may be shared with foreign countries with which Panama has information exchange treaties.

• We request that a release form be signed by the beneficial owner and that we are kept appraised of his/her address during such time as we remain Resident Agents for the company. Any change of beneficial owner must be disclosed to us and we reserve our right to resign as Resident Agents at any time, if this is not complied with.

• Apart from the release, we require the signing and Incorporation Questionnaire be completed, which we request that you send to us together with a copy of your passport and references, upon sending us the final instructions to incorporate a corporation or a foundation. References may be from your bank or from your accountant or lawyer.

• An annual Balance Sheet report (not income tax return) must be filed with the corporation’s lawyer.  This may be provided to the Government at their request.  

Private Interest Foundations

The Private Interest Foundation was created in Panama by Law No.25 of 1995 (hereinafter PIF). Its structure is similar in some aspects to that of the corporation, but may not engage in business. The subscriber in the corporation is the founder in the PIF. The Board of Directors is the Management Council.

• The PIF requires a founder, who decides which assets are incorporated into the PIF. The founder may be a corporation or a person and its name appears in the Public Registry.

• The members of the Management Council are to be provided by the founder.

• The beneficiaries of the PIF are established in its By-Laws, which are not a matter of public record, but normally are notarized. The beneficiaries do not have control of the PIF and the Founder may change the By-Laws and beneficiaries at any time, and may withdraw any or all the assets from the foundation at any time if the PIF is revocable.

• The PIF has the advantage that its assets are not subject to liens or attachment, unless it is due to debts of the foundation itself or within three years of the transfer of assets to the PIF, when creditors may prove the transfer was made fraudulently by the Founder to avoid paying its creditors.

• It is important to mention that the purpose of the Private Interest Foundation is as its name states, private (for estate planning and asset protection), and although it is an entity that may or may not have taxable income, this is not a charitable foundation. Therefore, this type of foundation cannot be used to collect funds from the public. Charitable foundations in Panama have to go through a more rigorous procedure to be established and must be authorized by the Ministry of Government and then filed in the Public Registry.

• The PIF may have a Protector which is appointed by private document and may oversee and advise the Management Council on the management of the assets. Whe do not offer the services of asset management.

• The name of the foundation’s  beneficial owners is recorded in a closed registry where only specific government authorities have access.  This information may be shared with foreign countries with which Panama has information exchange treaties.

• We request that a release form be signed by the founder or beneficial owner and that we are kept appraised of his/her address during such time as we remain Resident Agents for the PIF. Any change of beneficial owner must be disclosed to us and we reserve our right to resign as Resident Agents and Council members at any time, if this is not complied with.

• An annual Balance Sheet report (not income tax return) must be filed with the foundation’s lawyer.  This may be provided to the Government at their request

Estate Planning 

If you have assets in Panama in your name,  it is advisable that you issue a last will and testament in Panama.  

A consultation is advisable for us to help you determine if you do require a last will in Panama, or if there are ways in which probate may be avoided here. 

Maritime Law - Vessel Registration

Panama’s vessel registry operates since 1925 and is currently the largest in the world.  We can assist you with the registration of your vessel in Panama. 

Upon request, we will provide you with the list of documents and information which we will need in order to assist you in flagging your vessel in Panama.