Many people who invest in Panamanian real estate choose to register their land or property under the name of a Panamanian corporation instead of directly under their own name. This process is also common among Panamanians for several reasons - the major one being anonymity. This is a perfectly legitimate and commonplace practice.

Many people who invest in Panamanian real estate choose to register their land or property under the name of a Panamanian corporation instead of directly under their own name. This process is also common among Panamanians for several reasons - the major one being anonymity. This is a perfectly legitimate and commonplace practice.

The public registry is basically public information. This means that anyone can uncover information about your international property investments. It is a much harder process to find out the owner of a corporation and it is possible to have the corporation under a third parties name to hide your name completely from the authorities.

If you wish to use your property to gain residency in Panama then putting it under a corporation is not the best idea as you need to be able to show ownership of the property. It does help out when you want to avoid paying capital gains and income taxes.

If you are a property investor then putting your property into a corporation is a must. This is for various reasons. When you want to sell your property, you actually transfer the shares of the corporation. This allows you to avoid paying 2% transfer tax. Also because the seller doesn't have to show the earnings, the capital gains tax can be avoided. The law was changed in 2006 installing a 10% capital gains tax on the sale of corporate shares. A good lawyer can probably find a way around this.

The final reason to place investments under a Panamanian corporation is for asset protection. If a property cannot be directly connected to you, it cannot be declared an asset in a lawsuit if you are sued or going through a divorce.

Most law firms in Panama are capable to set up a corporation. It should only take around 3 days for the corporation to be set up and it costs around $1000. The annual charges are about $300 depending on the law firm you choose.