Legal and Compliance
In Panama, the responsibility of legal compliance is not a one-time affair, but a continuous process. Below is the various Panama legal and compliance requirement to be followed by incorporated entities:
· The Ministries of Economy and Finance and the Ministry of Commerce and Industries are the main official institutions engaged in giving direction, regulating and monitoring commercial activities within the country.
· All the business entities carrying on business in Panama are under the obligation to file an income tax declaration, as well as discharge any other lawful requirement related to the type of business they undertake.
· Tax returns must be filed no later than 90 days after the end of the fiscal year.
· Tax is paid via income tax return, and must be made no longer than 3 months after closing of the corresponding accounting period.
· Panama does not impose foreign exchange controls.
· An annual statement of transactions in Form 930 with related parties must be submitted to the tax authorities within six months after the end of the fiscal year
· The taxpayers must prepare a transfer-pricing study and make it available to the tax authorities.
YourGlobalPro professionals can assist you on Panama Legal and compliance requirements.
HR and Employment Law and Immigration / VISA
Below are some of the important points in relation to HR & employment law in Panama:
· Day shift involves a maximum 8 hours, and its workweek is defined as up to 48 hours.
· Maximum night shift is 7 hours and its work- week covers up to 42 hours.
· Workers are entitled to annual paid vacations determined at the rate of 30 days for every 11 months of continuous work
· 25% fixed overtime pay for overtime hours.
· Fixed overtime pays of 50% for working on a weekly day off
· Foreigners remaining in Panama for more than 30 days must register with the National Immigration Service (“Servicio Nacional de Migración”) of the Ministry of Government and Justice.
· obligation to enter into Labor contract agreements in writing in 3 copies (one each for the worker, employer and Ministry of Labor and Labor Development).
· employers must pay workers a special bonus styled “Thirteenth Month” consisting of a day’s salary for each eleven day work
· Contracts can be entered into for specific or indefinite periods and for specific works – maximum term for a specific contract is one year.
· The Panama law allows contracting foreign workers in a proportion of not more than 10% of the workforce, except for foreign technicians, whose percentage may increase up to 15%
· The foreigner who wish to work in Panama – require a Work Permit issued by the Ministry of Labor and Labor Development and a Work Permit is valid for one year, renewable for similar periods up to a maximum of 5 years