Panama Private Foundations offer a flexible and secure way to manage your assets while maintaining your privacy. They can be used for a variety of purposes, such as estate planning and protecting your family’s wealth.
With no minimum capital requirement, Panama Private Foundations are a popular choice for individuals and families looking for a cost-effective and efficient way to manage their wealth.
A Private Foundation (“Foundation”) is created when one or more natural persons or legal entities (“Founder(s)”) formalize a document known as a “Foundation Charter”, which is registered at the Public Registry of Panama, through which the parties undertake to make a donation (“Foundation Assets”) not less than the equivalent of US$10,000 (which sum may be subsequently increased by other donations), to be managed by a “Foundation
Council” under the supervision or not of “protectors”, for the benefit of one or more “beneficiaries”. The obligation to contribute donations, whether in money or in kind is not subject to a limited period of time and there is no legal requirement to publicly or officially advise its delivery. Once registered at the Public Registry in the Republic of Panama, the Foundation Charter creates a new legal entity without need for any further legal or administrative endorsement.
MAIN FEATURES
- The minimum capital of the Foundation shall be USD10, 000.00 although this value does not has to be paid at the creation of the foundation.
- The Founder may be part of the Foundation Council, Attorney and beneficiary of the Foundation.
- A Nominee Founder and Nominee Council could be used which can be a Panamanian corporation managed by the Founder (the client will control the company by a shareholders’ meeting) or an internal company.
- The Foundation Council may be composed of physical persons known by the Founder, for privacy matters by a corporation controlled by the Founder, an internal company or nominee directors.
- The Letter of Wishes is an internal document that may be issued by the Founder or if it is established in the Foundation Charter by the Foundation Council. The Letter of wishes, if not otherwise established, may be modified by the Founder. It is recommended that the Foundation Council have one original letter of wishes, as the Founder.
A Private Foundation is the combination of a corporation and a trust. In general, a Foundation has similarities with a corporation in as far as it is registered at the Public Registry, the assets of this new legal entity are separate from those of its creators, it is constituted to maintain confidentiality on the ownership of assets and in order to obtain fiscal benefits, and it has similar administrative bodies. It differs from a corporation in that the Foundation has no owners, as it does not issue share certificates nor any other participation title, and a Foundation may be created as a testamentary instrument and may not have profit aims.
Likewise, a Foundation has similarities with a trust: It is a juridical institution that requires specific formalities; some of the Founder’s assets are transferred, contributed or “donated” to the Foundation; a Foundation may be revocable; it may be created inter-vivos or mortis-causa by means of testamentary provisions; it is usually created with the purpose of managing, preserving, administering or investing assets for the benefit of the donor’s close relatives, as well as to obtain confidentiality and fiscal benefits.
It differs from a trust in as far as the Foundation is the owner of its own assets since it possesses its own legal entity and there is no “trustee” but rather the figure of a “Foundation Council” which combines the functions of the “Board of Directors” (of a corporation) and the functions of a “trustee” (of a trust).
Finally, a Foundation is registered at the Public Registry and is subject to an annual fee that is identical to that of corporations in Panama but of US$350.00.
If you’re interested in learning more about Panama Private Foundations and how they can benefit you, reach out to us for a consultation. 💼💰 #panama #panamafoundation #privatefoundation #whypanama #sucessionplanning #PanamaPrivateFoundations #WealthManagement #AssetProtection #EstatePlanning
