Types of Companies in Panama (2026): S.A., SRL & More

The most common types of companies in Panama are the sociedad anónima (S.A.) and the sociedad de responsabilidad limitada (SRL). Sole proprietorships and private interest foundations also exist, but they serve different purposes. Here is how they compare in 2026. For the full setup process, see how to start a business in Panama.

Panama has a dollarized economy and a territorial tax system, and the general ITBMS (VAT) rate is 7%. Whichever structure you choose, every S.A. and SRL needs a resident agent (a Panamanian lawyer or law firm), and its beneficial owners are recorded through that agent in Panama’s private registry (Ley 129 de 2020).

1. Sociedad Anónima (S.A.)

The S.A. is Panama’s most widely used company and the usual choice for foreign founders.

• Formed by two or more subscribers of any nationality, who do not need to live in Panama (Ley 32 de 1927)
• Board of at least three directors, plus officers (president, secretary and treasurer are standard)
• No legal minimum capital. The authorized capital and shares are set in the pacto social
• Resident agent required
• Annual tasa única of USD 300

2. Sociedad de Responsabilidad Limitada (SRL)

• At least two partners (individuals or companies), with no legal maximum (Ley 4 de 2009, art. 4)
• Managed by administrators named in the pacto, who may or may not be partners. Officers and attorneys-in-fact are optional
• Capital can be stated in any currency, and ownership is divided into participations rather than shares
• Under art. 28, income tax falls on the partners in proportion to their share
• Resident agent required (art. 5)
• Annual tasa única applies

3. Sole proprietorship

An individual can trade in their own name. There is no separate legal entity, the owner is personally liable, and business income is taxed as the owner’s personal income. It also requires an Aviso de Operación on Panamá Emprende.

4. Private Interest Foundation (Fundación de Interés Privado)

Foundations are asset-holding and succession vehicles, not trading companies, and they are not meant for regular commercial activity. They have a foundation council and may name a protector and beneficiaries. They pay an annual tasa única of USD 400, and as with other entities, their foreign-source income is not taxed in Panama.

Foreign company branch

An existing foreign company can register a branch at the Public Registry by filing its apostilled, translated corporate documents.

Which one should you choose?

For most foreign-owned operating or holding companies, we recommend the S.A.. Choose an SRL when you specifically want its partner-level tax treatment. Contact us for a quote and we’ll confirm the right structure for your plans.