Partnership Limited by Shares in Panama — Digital Products Seller Formation Guide
Focus on jurisdictions that support global payment processors. If selling to EU customers, consider how the jurisdiction handles VAT OSS (One Stop Shop). US LLCs are popular for accessing Stripe, while UK or Estonian companies offer great European integration.
Last verified: June 13, 2026
Corporate Tax
25.0%
State Tax
0.0%
Formation Cost
$60
Annual Fee
$300
Forming a Partnership Limited by Shares in Panama as a Digital Products Seller means a total tax burden of 25.0% and an official formation cost of $60. There is no minimum capital requirement. Standard formation takes 3-5 business days, or 1-2 business days expedited. No local director is required; the process can be managed remotely. This guide covers the steps, tax breakdown, banking options, and compliance requirements — all from verified data.
First-year total cost
≈ $1,235
Ongoing (per year)
≈ $600
Why Partnership Limited by Shares for Digital Products Seller?
Entrepreneurs selling non-physical goods such as software, e-books, online courses, templates, and digital art. This business model requires a jurisdiction with excellent payment gateway access (like Stripe or PayPal) and clear rules on digital VAT/Sales Tax.
Ideal for
- E-book authors
- Online course creators
- Software and SaaS developers
- Digital template designers
Challenges to watch
- Managing global VAT and sales tax compliance
- High chargeback rates for digital goods
- Intellectual property protection across borders
Key decision criteria
- Access to Stripe, PayPal, and other major payment gateways
- Tax treaties to avoid double taxation on royalties
- Ease of remote company management and banking
Partnership Limited by Shares formation requirements
Minimum capital
None
Standard timeline
3-5 business days
Expedited timeline
1-2 business days
Local director
Not required
Registered office
Virtual office allowed
Notarization
Required
Foreigners can act as general partners (who manage the company). A local resident agent (lawyer or law firm) is legally required.
Estimated breakdown (based on avg. $60,000 revenue)
Simulate with your own revenue →
VAT / Sales Tax
Standard rate 7%. Registration threshold: 36,000 USD. Non-resident providers of digital services without a permanent establishment in Panama are generally not required to register for ITBMS. However, B2B transactions may be subject to a reverse charge mechanism.
Banking & payments for Digital Products Seller
Opening a local bank account in Panama for a Sociedad en Comandita por Acciones can be challenging and time-consuming for non-residents. Banks require extensive KYC, proof of economic ties to Panama, and often an in-person visit, though some allow remote opening through legal representatives.
Supported payment gateways
Remote-friendly accounts
Payoneer
A popular digital alternative for Panamanian offshore entities to receive international B2B payments in USD.
Panama incentives & advantages
EMMA Regime (Manufacturing Services)
5% reduced corporate income tax rate, exemption from dividend tax, and import tax exemptions.
SEM Regime (Multinational Headquarters)
5% corporate tax rate, 0% dividend tax, and special visa categories for foreign executives.
Partnership Limited by Shares formation steps
Choose a company name including the suffix 'Sociedad en Comandita por Acciones' or 'S.C.A.' and verify availability in the Public Registry.
Draft the Articles of Incorporation (Pacto Social), specifying the general partners, limited partners, and share capital structure.
Notarize the Articles of Incorporation before a Panamanian Notary Public.
Register the notarized deed at the Public Registry of Panama (Registro Público).
Appoint a Resident Agent (a Panamanian lawyer or law firm), which is legally required for all entities.
Pay the initial Annual Franchise Tax (Tasa Única) of $300 to activate the entity.
Obtain a Notice of Operation (Aviso de Operación) if the company will conduct commercial activities within Panama.
Register with the Directorate General of Revenues (DGI) to obtain a Tax ID (RUC).
Digital Products Seller FAQ
Do I need to charge VAT on digital products?
Yes, in many jurisdictions like the EU, UK, and parts of the US, you must collect VAT or sales tax based on the customer's location, regardless of where your company is incorporated.
Which country is best for a digital product business?
The US (Wyoming or Delaware LLC) is excellent for Stripe access and low maintenance. Estonia (OÜ) is ideal if you want to keep profits in the company tax-free and need EU market access.
Can I run this business as a digital nomad?
Absolutely. Digital product businesses are location-independent. However, ensure your chosen corporate structure doesn't trigger tax residency issues in the country you are temporarily living in.
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Related guides
Complete Partnership Limited by Shares guide
Taxes, requirements, banking, compliance
Partnership Limited by Shares cost calculator
One-time and annual cost breakdown
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