Five important tips you need to know about purchasing property in Panama
This article was written by Jose Alejandro from Legal Corp:Personalized and Innovative Legal Consultant. 1. Know your tax system. Some countries tax their citizens on assets they own even outside the country of origin and sometimes as luxury items. Remember that the assets you hold in Panama also pay taxes in Panama (if taxes apply); so you may end up paying double taxes on a single property: in Panama and your country or origin. This can be prevented by purchasing under a corporation or applying for Panamanian tax exemptions. 2. Some real estate companies will tell you that purchasing a property in Panama will automatically give you immigration benefits. This is partially true. While there are visas that need you to make an investment (that could very well be a property), property is usually only one of the requirements.
3. Tax incentives. Not all properties in Panama have tax incentives and the duration of that incentive vary in most cases, depending on the date of construction and the price of the property. But, these incentives are not automatic, so make sure that the property has already been registered for tax incentives. This process can last up to a year or more in some cases.
4. Make sure you know when you're starting the process. February, March, November and December, are months that usually all sectors slow down, especially government, do to numerous festivities. So during those days, procedures can stop or get delayed considerably.
5. Corporations are a very safe, effective and helpful for buying and selling property. But get to know this figure, because the Panamanian corporations are very different from all other corporations. Always have a due diligence done on both corporation and property, especially regarding taxes and ownership. Ask questions and don't do anything until you fully understand what you are getting, with what and when.
( This was the information available as of October 2008 and should be verified before proceeding.)