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Panama has always positioned itself as an attractive destination for expatriates, businessmen, retirees and foreign investors. Forty percent of real estate assets in Panama above $140,000 are purchased by foreigners. Despite the pandemic we can see that the Panamanian real estate market is going through a boom of international buyers. Real estate buyers often forget that they will most likely sell the property at some point. Personal circumstances may change, and eventually, you want to sell. The purchase of a property should be well structured from the beginning to avoid headaches and bad surprises in the future: What will be the taxes to be paid when the property is sold? What legal figure is the most convenient to acquire the property? Selling a Panamanian Corporation: Asset Deal vs. Share Deal In the past it was very fashionable to invest and sell real estate in Panama by buying and transferring the shares of a corporation, thus maintaining the cadastral value low, so as not to increase it each time it passed from hand to hand (buyer/seller). When the Panamanian government discovered that this was a normal practice, it decided to regulate this type of transactions: Which means in order to transfer a property, the seller must pay approximately five percent (5%) in taxes and the same applies if you sell the shares of a corporation. Five percent (5%) taxes of the value of that share deal must be paid to the tax office. The only advantage of paying that tax for selling the shares, is that the cadastral value will not increase every time the property is sold over and over again, and therefor maintain annual property taxes low. In fact, selling a corporation represents in simple words, selling the shares with all the corporation’s assets included, changing the board of directors, changing the resident agent and paying the taxes to the DGI (tax office) through form 108. The only thing that cannot be modified in this method of purchase and sale are the subscribers, but that does not affect the interests of the new owner... since with the formal resignation of the subscribers, they will not have any right to claim in the future. But, How Do You Sell a Private Interest Foundation in Panama? If foundations are not made as instruments to negotiate, neither to carry out business activities in Panama, since they are made for estate planning and as a living will, then how do you sell them? The answer can be found in an article that modifies the Foundation Law of Panama (already created several years ago by the way), in fact within a Law that is not related to the subject of foundations. Based on this legal footing you can sell all the rights of your foundation, including all its assets, by means of a private and notarized contract, and by making all necessary changes within the foundation (foundation council, resident agent, by-laws, and even the name if you like). Of course, the technical - practical legal details of the whole transaction are too complicated and complex to explain in a blog without boring the reader with technical and legal terms, but in conclusion,… you can sell your foundation. And if the foundation owns a property, well, you do not have to pay transfer taxes to the tax office because what you are selling is not the property itself, it is the foundation with its rights and obligations.
I want to write a cheque on my Canadian U.S. dollar account for deposit in a bank here. I hoped it would be easy, after all, Scotiabank Canada to Scotiabank Panama....silly me. The bank here wants $300 for a $3,000 cheque. Not gonna happen. Is there any other bank (and yes, Scotiabank Panama may lose my business over this) that will accept such a cheque without exorbitant fees? Looking for a different way to get money down here without doing a large transfer every year or so. Would like to write monthly or quarterly cheques.