Panama and Nevis are classic offshore jurisdictions, but they work differently. Panama taxes only Panama-source income and suits trading and holding structures with business ties in Latin America. Nevis, an island in the Federation of St Kitts and Nevis, registers International Business Companies (IBCs) and LLCs, which are more often used to hold shares, real estate and investments.
Comparison at a glance
| Parameter | Panama | Nevis |
|---|---|---|
| Tax principle | territorial: income tax only on income arising in Panama (Article 694 of the Código Fiscal) | the regulator's fee schedule includes a Tax Exemption Letter; the conditions are checked for each specific company |
| Typical form | sociedad anónima (S.A.) | IBC under the Nevis Business Corporation Ordinance or LLC under the Nevis Limited Liability Company Ordinance |
| Who maintains the company | a resident agent: a Panamanian lawyer or law firm | a licensed registered agent in Nevis |
| Regulator | Superintendencia de Sujetos no Financieros, Registro Público | Financial Services Regulatory Commission (FSRC), Nevis Branch |
| Beneficial owners | a closed government register under Law 129 of 2020 | the agent obtains and keeps information on beneficial owners and shareholders |
| Annual obligations | by April 30, provide the agent with accounting records for the previous year | renewal fee of USD 300 (IBCs and LLCs) |
| EU list of October 9, 2026 | not on the list; awaiting an in-depth Global Forum review (Annex II) | St Kitts and Nevis is not on the list |
Taxes: territorial principle versus exemption
Under Article 694 of Panama's Tax Code, income tax is paid on income arising in the country, regardless of where the money is received. As a general rule, a company that operates only abroad does not pay Panamanian income tax.
From the 2027 tax period, Law 526 of May 28, 2026 takes effect in Panama. For members of multinational groups, passive foreign income (dividends, interest, royalties, capital gains, income from real estate and movable capital) is taxed at 15% if the entity does not meet economic substance rules in Panama. A holding company of an international group should take this law into account already.
In Nevis, the FSRC issues a Tax Exemption Letter, and its fee under the schedule is USD 100. We check the scope of the exemption in each case when preparing the structure.
In both jurisdictions, the owner's taxes are determined by the country of their residence: profit may be taxed under CFC rules, when dividends are paid, or when the company is actually managed from that country. For details, see our article on a company's tax residency.
Agent, beneficial owners and transparency
Panama. Law 129 of 2020 defines a resident agent as a lawyer admitted by the Supreme Court of Panama or a law firm. The agent submits beneficial ownership information to the Sistema Privado y Único de Registro de Beneficiarios Finales. The law describes this register as private and with restricted access: direct access is held by the agent and designated Superintendencia staff, while authorized bodies, including the financial intelligence unit and the tax authority, receive information on request.
Nevis. Under FSRC rules, the registered agent obtains and keeps identity information on beneficial owners and shareholders, and the company's corporate and accounting records must be available to the agent and the FSRC on request. An LLC must have an agent in Nevis at all times; without an agent it may be dissolved.
In both countries, an anonymous company cannot be set up. Advertised promises of "complete anonymity" have nothing to do with the actual law.
Annual maintenance
Panama. Law 52 of 2016, as amended by Law 254 of 2021, requires companies that do not carry out operations in Panama to keep accounting records and retain supporting documents for at least five years. Every year by April 30, the company provides the agent with the records, or copies of them, for the previous financial year. For an asset-holding company, data on the value of assets, income and liabilities is enough; a trading company needs a journal and a general ledger.
Nevis. The annual renewal fee under the FSRC schedule is USD 300 for an IBC and for an LLC. Late payment incurs a penalty of USD 200 in the first six months and USD 400 after that. Agent and office services are paid separately.
Banking and payments
A bank looks at the jurisdiction together with the business model. It will ask a Panamanian trading company about contracts, invoices, suppliers, buyers and the route of the goods. Banks and payment services review Nevis companies especially closely, so an asset holder needs documents on the assets, the origin of capital and clear scenarios for incoming funds. We prepare the package under our bank account for an offshore company service.
How to choose
- Trading or intermediary business with Latin America: more often Panama, since counterparties know Panamanian structures and the territorial principle suits a company with no Panama-source income. For details, see the page Panama offshore company.
- Holding shares, real estate or a portfolio: more often Nevis, especially an LLC with flexible management rules. For details, see the page Nevis offshore company.
- A company in a multinational group with passive income: in Panama, from 2027 we check the requirements of Law 526.
- Sales to EU clients through marketplaces and cards: both jurisdictions usually raise extra questions from PSPs; for this model we compare them with England or Hong Kong.
Protecting property through a company works when the structure is set up in advance and with full disclosure of the owners; see the guide to offshore asset protection. Other pairs of classic offshore jurisdictions: BVI or Belize and Cayman Islands or BVI.
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