Panama Private Foundation Part 6 – Panama Private Interest Foundations Tax Information

1. Tax Free Foundations

Panama is a 100% “tax haven”. Panama Foundations offer the following tax advantages:
– No tax reporting requirements.
– No income tax.
– No capital gains tax.
– No interest income tax.
– No sales tax.
– No tax to beneficiaries.
– No beneficiary transfer tax.
– No capital tax.
– No property tax (for non-Panamanian property).
– No estate tax.
– No gift tax.
– No inheritance tax.
– No stamp tax.
– No succession tax.
– No inventory tax

2. Flat Annual Corporate Franchise Tax

The only tax paid by Panama Corporations (or Foundations) is the flat annual corporate franchise tax of USD300.
According to the Law, the corporate franchise tax payment deadlines are as follows;
Incorporation Date ………………Tax Payment Deadline

From 1 of January to 30 of June 30: July 15
From 1 of July to 31 of December 31: January 15

3. Late Payment Penalty

Late Payment Penalty:
If the flat annual corporate franchise tax (“taza unica”) is not paid on or before the due dates mentioned above, the entity will be charged a late penalty of USD50.00 per year that the tax is not paid.

Second Late Payment Penalty:
If the flat annual corporate franchise tax (“taza unica”) is not paid after 1 “deadline” period, the entity will be charged a second late penalty of US$300 for every additional “deadline” period missed thereafter, a USD300 late fee will be incurred.
The above applies to all “entities” (corporations, foundations, or trusts) registered at the public registry of Panama