Dear client,
On December 30, 2024, Executive Decree 177 was published, establishing new provisions for legal entities in Panama. These rules apply to corporations, limited liability companies, or any other type of entity, as well as private interest foundations that do not operate in Panama or generate income abroad, and those that hold assets within and/or outside Panama.
Classification and Annual Obligations
1. Panamanian Legal Entity: Exclusively holding assets inside and/or outside Panama, whose ultimate beneficiaries are Panamanian citizens.
o Corporation or Private Interest Foundation Holding Assets Inside and/or Outside Panama:
▪ Submission of a Sworn Declaration (Download here); and
▪ Submission of an Annual Declaration of the Location of Accounting Records (Download here).
o Corporation or Private Interest Foundation Generating Taxable Income Outside Panama:
▪ Submission of financial statements or a summary of financial elements (Download here); and
▪ Submission of an Annual Declaration of the Location of Accounting Records (Download here).
2. Foreign Legal Entity: Exclusively holding assets inside or outside the Republic of Panama and/or generating income, whose ultimate beneficiaries include at least one foreign citizen.
o Submission of financial statements or financial summary (Download here); and
o Submission of an Annual Declaration of the Location of Accounting Records (Download here).
3. Non-Operational Legal Entity: Does not conduct commercial activities, generate income, or hold assets inside and/or outside Panama, and whose ultimate beneficiary is either Panamanian or foreign.
o Submission of a certification or sworn declaration (Download here); and
o Submission of an Annual Declaration of the Location of Accounting Records (Download here).
The certification or sworn declaration must be signed by a member of the board of directors or the council of the foundation, as applicable, its ultimate beneficiary, or a representative of the latter duly authorized.
These regulations will take effect starting in 2025 for the fiscal period ending on December 31, 2024.
Failure to comply with these obligations may result in fines and penalties imposed by the General Directorate of Revenue (DGI).
For more information, please contact us at regulatory@omcgroup.com.
