Panama foundations are fashioned on similar international foundation laws. The presiding law for the protective Panama private foundations is The Panama Private Interest Foundation Law No. 25 passed in June 1995. The Panama foundation is a tax free entity with combined features of a will, trust and corporation. Panama foundations in which revenue and income are from outside of Panama — are all tax free.
Under statutory laws of Panama foundations, there is no owner of a Panama foundation, and as such any assets transferred to a foundation have no owner, and cannot be tied to you.
The formation of the Panama foundation is different from that of Anguilla, Nevis or Belize; first — we only offer Panama foundations with Nominee members ( a facility that benefits you by providing privacy and anonymity of interested parties). Panama foundations are registered in a public register, and this means that information in articles of formation is public — such as founder, council members. Then, the founder of a Panama foundation is merely the person who physically presents the establishment documents to the Panama registry- as such this can be us, your agent. The founder has no other function, control or power over the foundation.
Panama foundations require a minimum of three members on the council and for an affordable fee, we provide all three nominee council members, whose names will appear on the registry. These officers will not be known to you nor have any interest in the foundation. The control of the foundation is passed onto you through two main actions:
- The Issue of signed and undated letters of resignation for all three nominee council members so you may fire and replace members at your convenience;
- The issue of a Power of Attorney in your name or name of someone you assign;
The beneficiaries of the foundation are not disclosed publicly and only noted if desired – in a letter of wishes and you can be a beneficiary of the Foundation.
Panama Foundation Restrictions
Generally, Panama Private Interest Foundations cannot engage in routine mercantile activities as a corporation does, but they may carry out commercial activities by owning shares in corporations ( that are actively engaged in commercial business activities) providing that the profits generated by the companies are used for purposes of the Foundation.
Panama Private Interest Foundation Features:
- The assets in the Panama foundation must have a minimum value of US$10,000;
- The founder of a foundation can be listed as the agent- providing privacy for the person establishing foundation.
- Assets held by a foundation in Panama can be real, tangible or intangible;
- Assets within a foundation are protected from insolvency or bankruptcy, seizure, claims;
- Panama foundations can in fact own Panama corporations, and can do business in Panama. As long as the revenue generated for the foundation is earned outside the jurisdiction, the foundation income is tax free;
- Panama foundations can undertake passive investments like stock market investment, trading, Forex trading, interest bearing bank deposits, as long as the earnings are used for the benefit of the beneficiaries. The Panama Foundation can own shares and interests in private or public companies;
- The foundation is like a corporation, it is a separate legal entity that can buy and sell property, sue and be sued, enter into contracts and hold assets in its own name.
- You can be a beneficiary of the Foundation.
Panama Private Foundation Benefits
- The Panama Foundation is a hybrid entity that combines the features of Trusts, wills and Corporations.
- Tax Free — Panama Private Foundations in all forms are exempt from all taxes and duties on income genereted outside Panama;
- Multi Purpose Uses — The Panama Foundation has the same consideration as companies and is usually regarded as a corporate entity;
- Asset Protection — assets in a Panama Foundation, or any contribution to a Panama Foundation, cannot be void or voidable because of foreign law or judgment; the assets of Panama Foundations are not considered to be subject to sequestration or embargos and cannot be frozen.
Panama Foundation Requirements
In order to set up or form a Panama foundation, the following conditions must be met:
- One or more natural or legal persons may establish a foundation, agent can act as nominee founder;
- The initial property endowment (in any legal currency) must have a minimum value of US$10,000;
- Private Interest Foundations must have a Panama registered agent acting on their behalf;
- The Panama Foundation is established through the written foundation charter
- Name of foundation
- Property endowed
- Name, address of founder or founders
- Full name of foundation council member (minimum of 3)
- Name and address of registered agent
- Name and address of secretary (if any)
- Purpose of the foundation
- Duration of foundation
- Meetings shall be held at such times as Foundation Council may determine and may be held anywhere in the world
- A foundation shall keep or may have cause to keep such accounts or records as its council deems necessary.