Limited Partnership (Sociedad en Comandita Simple) in Panama — Drop Servicing Formation Guide
Choose a jurisdiction with strong payment gateway support (Stripe, PayPal) and low withholding taxes on foreign contractor payments, as you will be paying freelancers globally.
Last verified: June 13, 2026
Corporate Tax
25.0%
State Tax
0.0%
Formation Cost
$350
Annual Fee
$300
Forming a Limited Partnership (Sociedad en Comandita Simple) in Panama as a Drop Servicing means a total tax burden of 25.0% and an official formation cost of $350. 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
≈ $1,390
Ongoing (per year)
≈ $650
Why Limited Partnership (Sociedad en Comandita Simple) for Drop Servicing?
Drop servicing (or service arbitrage) involves selling digital services to clients and outsourcing the fulfillment to freelancers or white-label agencies. As a founder, your main focus is on marketing, sales, and client relationship management, while the actual work is handled by third parties.
Ideal for
- Marketers and sales professionals
- Entrepreneurs with strong networking skills
- Founders looking for location-independent businesses
- Those wanting to start an agency without technical skills
Challenges to watch
- Maintaining quality control over outsourced work
- Managing cash flow between client payments and freelancer fees
- Handling cross-border contractor tax compliance
- Building trust and brand reputation
Key decision criteria
- Access to global payment processors (e.g., US LLC or UK LTD)
- Tax implications of hiring international contractors (W-8BEN for US)
- Clear B2B contracts and terms of service
- VAT/Sales tax rules for digital services in your clients' countries
Limited Partnership (Sociedad en Comandita Simple) 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
A local director is not required, but the partnership must appoint a Resident Agent (a Panamanian lawyer or law firm).
Estimated breakdown (based on avg. $80,000 revenue)
Simulate with your own revenue →
VAT / Sales Tax
Standard rate 7%. Registration threshold: 36,000 USD. Foreign providers of digital services are generally required to register and collect the 7% ITBMS if their services are consumed in Panama. Non-resident businesses without a permanent establishment may face reverse-charge mechanisms for B2B sales.
Banking & payments for Drop Servicing
Opening a local corporate bank account in Panama as a non-resident can be rigorous, typically requiring extensive KYC, proof of economic ties, and an in-person visit. However, using international fintechs or specialized offshore banks can streamline the process for remote founders.
Supported payment gateways
Remote-friendly accounts
Payoneer
A global fintech platform that supports Panamanian entities for receiving international B2B payments.
MultiPass
A UK-based EMI that provides multi-currency accounts for offshore entities, including Panama.
Panama incentives & advantages
Territorial Tax System
0% corporate and personal income tax on all foreign-sourced revenue.
Special Economic Zones (e.g., Panama Pacifico)
Exemptions from corporate income tax, import duties, and dividend taxes, plus expedited visa processing for foreign workers.
Limited Partnership (Sociedad en Comandita Simple) formation steps
Choose and verify the availability of the partnership name at the Public Registry of Panama.
Draft the Partnership Agreement (Pacto Social) detailing the general and limited partners, capital contributions, and management rules.
Notarize the Partnership Agreement before a Panamanian Notary Public to create a Public Deed (Escritura Pública).
Register the Public Deed at the Mercantile Section of the Public Registry of Panama.
Pay the initial Annual Franchise Tax (Tasa Única) of $300 to activate the entity.
Obtain a Tax Identification Number (RUC) from the Directorate General of Revenue (DGI).
Apply for a Notice of Operation (Aviso de Operación) through the PanamaEmprende portal if conducting commercial activities locally.
Drop Servicing FAQ
Which country is best for a drop servicing company?
The US (LLC) and UK (LTD) are highly popular due to easy access to Stripe/PayPal, global credibility, and straightforward rules for paying international contractors.
Do I need to pay withholding tax when paying freelancers?
It depends on your company's jurisdiction and the freelancer's tax residency. For a US LLC, collecting a W-8BEN form from non-US contractors usually exempts you from withholding tax.
How do I handle VAT or Sales Tax?
You must track where your clients are located. If selling B2B, the reverse charge mechanism often applies. For B2C, you may need to register for VAT/Sales Tax in the client's jurisdiction once you cross specific revenue thresholds.
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Related guides
Complete Limited Partnership (Sociedad en Comandita Simple) guide
Taxes, requirements, banking, compliance
Limited Partnership (Sociedad en Comandita Simple) cost calculator
One-time and annual cost breakdown
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