The Panamanian corporation is a kind of legal entity particularly suited for holding the title of assets and/or business concerns of any description, while at the same time ensuring confidentiality and security in any circumstances, a fact that becomes even more convenient when the anonymity of the owner of property/wealth may offer advantages in respect of governmental controls and taxes, personal protection, and ease of transfer and other forms of disposal.
The advantages of the corporation in any modern legislation are well known, but the advantages of the Panamanian corporation are always worth looking into even though they are a subject that requires no discussion among the most important law firms in the entire world. They have held an extremely prominent position in legislation tailored for offshore use since 1927, and they have been one of the major tools for investing and/or owning assets outside of the jurisdiction of the party in interest regardless of nationality or domicile.
Among many of its possible applications, it is worthwhile noting that it is an expedient for avoiding inheritance complications and probate proceedings.
The Office of the Public Registry in the Republic of Panama has earned worldwide repute for the protection it offers to corporations and their shareholders.
To make the Panamanian legal landscape even more attractive, over the past score of years other institutions have been added to complement the corporation through the Panamanian law on private foundations, which is ideally suited for estate management, among other things.
Communications in Panama city are on the same technological level as any of the most important cities in the industrialized countries, English among the lawyers in the top law firms is almost on a par with Spanish, and the U.S. dollar is the only paper currency recognized as legal tender by the Constitution, and is the subject matter of a bilateral treaty between the Republic of Panama and the United States of America almost one hundred years ago.
Types of companies
- Company with limited liability (GmbH)
- Limited and unlimited partnerships can be established
- Austrian Private Foundation.
Requirements for company formation
For limited liability company (GmbH):
A statutory share capital of € 35.000 is needed, of which at least € 17.500 – has to be paid in. After the registration of the company the share capital can be used as working capital.
For Austrian Private Foundation:
A minimum capital to be paid in amounting to € 70.000 is needed, after the registration of the private foundation these funds can be used for making investments too.
For Partnerships:
There are no any capital requirements.
Structure of an Austrian company
- Each Austrian limited liability company (GmbH) must have at least one director and one shareholder.
- The Austrian Private Foundation is managed by a board of three members; and does not have any shareholders.
Annual meeting, auditing and reporting
Austrian companies are obliged to have books of accounts and have to file annual accounts and tax returns as well as report to the competent court of registration.
In the case of a limited liability company (GmbH) compulsory audit is not necessary, only if certain thresholds regarding the number of employees, the assets value and the turnover are exceeded. The Austrian private foundation is obliged to have an audit of its books annually.
Fees associated with the company incorporation
The fees usually are in a range between €4.000 and €6.000, whereby this includes the cost for drafting the articles of association, the notarial deed, the bank compliance and obtaining a taxpayer’s identification number and a VAT identification number.
Furthermore 1% capital transfer duty has to be paid for the effectively paid in share capital as well as court duties in a range between €400 and €600.
General taxation rate for incorporated companies
Austrian corporations have to pay a flat 25% corporate income tax on their worldwide income whereby material tax exemptions are granted for foreign source dividends and foreign source capital gains, even if there is no tax treaty existing with the other country.
Austrian companies can also obtain tax-free dividends and tax-free capital gains from off-shore companies under certain circumstances.
The regulatory authorities can request information about the background and identify of the company officers, or company accounting information, provided that this information is requested and required to assist investigations or prosecutions in case of serious crimes such as money laundering, terrorism or fraud. Such information can be shared with other jurisdictions provided that there was a criminal prosecution initialized by a regular court in the other country.
Advantages of Czech companies
- Reputable holding destination in the EU territory.
- Possibility of effective tax optimization of holding activities (received dividends and sale of interest in subsidiary companies) derived from applicable EU directives and from a wide net of Treaties on the Avoidance of Double Taxation
- Convenient for entities which consider to run business activities in the Czech republic, for example purchase of real estate convenient for entities which make business with partners in the Central Europe.
- Easy incorporation / possibility to acquire a shelf company.
- Low costs of incorporation / acquisition.
- No need to deposit a high registered capital.
