Headquarters of Multinational Companies (SEM)
The SEM license grants tax benefits for both the company and the executive. As lawyers we can advise and guide you in the process, in order to obtain the Multinational Company Headquarters License and its advantages.
Benefit for the Multinational Company
Reduced Income Tax Rate: Companies holding a Multinational Company Headquarters License must pay income tax in the Republic of Panama on the net taxable income derived from the services provided at a rate of 5%.
The SEM company must liquidate and pay the income tax through the annual tax return, and may include within its deductible expenses the expenses incurred for labor remuneration of all its employees, in accordance with the provisions of the Code Prosecutor.
Tax on the Transfer of Movable Corporal Assets and the Provision of Services: As they are export services, they will not cause a Transfer Tax, provided that they are provided to entities of the business group abroad, that do not generate taxable income within Panama.
Dividend and complementary tax and branch tax: Companies holding a Multinational Company Headquarters License will be exempt from paying dividend tax, complementary tax and branch tax, regardless of whether they are of local source, foreign or exempt.
Fiscal Equipment: Companies holding a Multinational Company Headquarters License will not be subject to the use of fiscal equipment.
Capital Gains: The gain or loss on the transfer of shares issued by the SEM company are subject to the capital gains regime, but at a fixed rate of 2%, where the buyer will have the obligation to withhold from the seller an amount equivalent to 1% of the total value of the sale.
Notice of Operation: Companies holding a Multinational Company Headquarters License will not have the obligation to obtain a Notice of Operation for the provision of the services established in this Law; consequently, they will not be subject to the payment of the Operation Notice Tax.
Permanent Staff Visa for a period of 5 years, Temporary Staff Visa, 6-month stay visas.
The SEMs will be able to hire the necessary number of trusted personnel and senior management executives to carry out their operations in Panama. Dependents who wish to work may change their immigration status through the Single Window at the Ministry of Commerce and Industry.
The activities carried out by companies with Multinational Company Headquarters Licenses, authorized to operate in the Republic of Panama in accordance with Law 41 of August 24, 2007 and its reform laws, will be considered as acceptable investments and capable of obtaining the guarantees referred to in article 10 of Law 54 of 1998, regulated by Executive Decree 9 of February 22, 1999.
Companies that obtain a SEM License from January 1, 2019, will automatically enjoy legal stability