Corporate Law · EN
How to Form a Corporation (S.A.) in Panama: 2026 Guide.
How to incorporate a Panama Corporation (Sociedad Anónima) under Law 32 of 1927: requirements, directors and officers, share capital, the resident agent, the annual franchise tax and ongoing compliance. The vehicle most used by foreigners to hold assets and do business in Panama.
The Panama Corporation (Sociedad Anónima, S.A.) is the most widely used vehicle in the country to run a business, act as a holding, or hold assets — real estate, accounts, vehicles, shares. Governed by Law 32 of 1927, it is flexible, well-recognized internationally and quick to incorporate. This guide explains how.
Note: general information current as of the date; confirm your case with a lawyer.
What you need to incorporate
- Two or more subscribers to sign the articles of incorporation (they need not be the ultimate shareholders and can be provided by the firm).
- A board of at least three officers — president, secretary and treasurer — who may be individuals or entities, of any nationality, resident anywhere.
- A resident agent: a Panamanian lawyer or law firm is required by law and signs the articles.
- Share capital: there is no minimum; the usual authorized capital is US$10,000, divided into shares (par value or no-par).
- The articles are executed as a public deed and registered in the Public Registry, which gives the corporation legal existence.
What the corporation is used for
- Operating a business in Panama.
- Holding company for other companies or investments.
- Holding assets — property, bank and investment accounts, intellectual property.
- Combined with a Private Interest Foundation that owns its shares, for estate planning.
Territorial tax and dollarized economy
Panama generally taxes only Panama-source income; income from foreign sources is typically not taxed here. The economy is dollarized, so there is no currency risk on the company's capital. This is a large part of why foreigners choose the Panama S.A.
Ongoing compliance: keeping it alive
Incorporating is only the start. To keep your corporation in good standing you must maintain:
- The annual franchise tax (tasa única) of US$300.
- The resident agent.
- Accounting records and supporting documentation.
- The ultimate beneficial owner reported through the resident agent to the authorities.
- Bearer shares, if any, held under the custody regime (immobilized).
Let a corporation lapse on these and it can fall into arrears or even be struck off — a costly mistake we help clients avoid.
Related: Panama company types compared · Private Interest Foundation.
Legal basis: Law 32 of 1927 on Corporations. Informational content, not legal or tax advice.
Relacionado: Starting a business in Panama
Questions from the source
Questions, answers, and sources preserved from the historical archive. Nucleus has not verified their currency or links.
How do I form a corporation (S.A.) in Panama?
You draft the articles of incorporation (pacto social) through a lawyer, notarize them and register them at the Public Registry. A Panama corporation requires at least two subscribers, three directors/officers and a resident agent, who must be a Panamanian lawyer or law firm.
Is there a minimum capital to form a Panama corporation?
No. Panama's Law 32 of 1927 sets no minimum paid-in capital; the customary authorized capital is US$10,000 divided into shares, with no obligation to pay it in at incorporation.
Does a Panama corporation pay taxes on foreign income?
No. Panama follows the territoriality principle: a corporation is taxed only on Panama-source income. Foreign-source income is not taxed locally, though the company must pay the annual franchise tax and keep a resident agent.
How long does it take to incorporate in Panama?
Once the deed is filed, registration at the Public Registry usually completes within a few business days.