Glossary · Living in Panama
Glossary of Panamanian Legal Terms and Procedures
What the Spanish terms in Panama's procedures mean: cédula E, paz y salvo, RUC, NIT, apostille, registered agent, possessory rights and more.
- Updated
In short
Procedures in Panama use their own Spanish terms, which do not always match those in your country: paz y salvo, cédula E, RUC, NIT, agente residente or derechos posesorios. Here is what they mean in a few words and, for each one, the guide where we explain it in depth.
Terms
- Agente residente (registered agent)
- A Panamanian lawyer or law firm that every corporation or private interest foundation must keep. It holds the information on its beneficial owners (see annual corporate obligations).
- Apostilla (apostille)
- A stamp that certifies a public document so that it is valid in another country party to the Hague Convention. It replaces consular legalization (see embassies and consulates).
- Aviso de operación (business license)
- Registration with Panamá Emprende that allows you to carry on a commercial or industrial activity in Panama, with an annual tax (see business license).
- Balboa
- Panama's official currency, with the same value as the US dollar. It exists only as coins: the bills are dollars (see Panama's currency).
- Beneficiario final (beneficial owner)
- The individual who ultimately controls or benefits from a company or foundation. Their identity must be registered through the registered agent.
- Carné de residente (resident card)
- The card Immigration issues while your application is in process or for the duration of a provisional or temporary permit.
- Carta de naturaleza (naturalization letter)
- The document by which Panama grants citizenship to a foreigner (see naturalization).
- Carta de referencia bancaria (bank reference letter)
- A certification from your bank about your relationship with it and your balance, requested by Immigration and banks (see bank reference letter).
- Cédula E
- The common name for the permanent resident ID card issued by the Electoral Tribunal; its number starts with E (see permanent resident ID card).
- Certificado de residencia fiscal (tax residency certificate)
- A DGI document proving that you are a tax resident of Panama, for example to apply a treaty (see tax residency certificate).
- Cuatro cifras medias (medium four figures)
- How Panamanian banks express an average balance of four digits in the middle of that range, without giving the exact amount (see bank reference letter).
- Décimo tercer mes (thirteenth month)
- An extra payment workers in Panama receive, split into three installments a year (see hiring employees).
- Derechos posesorios (possessory rights)
- Rights to land that only prove occupation, not registered ownership. Buying possessory rights is riskier than buying titled property (see buying property).
- DGI (Dirección General de Ingresos)
- Panama's tax authority, part of the Ministry of Economy and Finance.
- e-Tax 2.0
- The DGI's online platform for registering, filing returns and carrying out tax procedures (see RUC and NIT).
- Fe de vida (proof of life)
- A life certificate the country that pays your pension requires to keep paying it abroad (see receiving your foreign pension).
- Fundación de interés privado (private interest foundation)
- A separate pool of assets, managed by a foundation council, dedicated to certain purposes and beneficiaries; used in wealth planning (see private interest foundation).
- Idoneidad (professional license)
- Authorization granted by the professional board of a regulated profession to practice it in Panama (see degree recognition).
- ITBMS
- Tax on the transfer of goods and the provision of services: Panama's consumption tax (similar to VAT), 7 % as a general rule.
- MIVIOT
- Ministry of Housing and Land Management. Its Leasing Directorate registers leases and holds security deposits (see lease agreement).
- NIT
- Tax Identification Number: the password you use to log in to e-Tax 2.0, not your taxpayer number (see RUC and NIT).
- Número Tributario, NT (Taxpayer Number)
- The tax ID the DGI assigns to people who cannot register with a Panamanian cédula, as many foreigners (see RUC and NIT).
- Países Amigos (Friendly Nations)
- Residency for nationals of a list of countries with an employment contract or an investment in Panama (see Friendly Nations Visa).
- Paz y salvo (clearance certificate)
- A certificate proving that you have no outstanding debts with an entity, for example with the DGI or for a property's property tax.
- Permiso provisional (provisional permit)
- The first permit for many residency options, usually for 2 years, before applying for permanent residency (see permanent residency).
- Propiedad horizontal (condominium property)
- The regime for buildings and condominiums with common areas, governed by bylaws that bind owners and tenants.
- Récord policivo (police record)
- The criminal record certificate issued in Panama by the Judicial Investigation Directorate (see police record).
- Renta de fuente panameña (Panamanian-source income)
- Income generated in Panama from activities carried out, assets located or capital invested there. It is what the territorial system taxes (see territorial taxation).
- RUC
- Single Taxpayer Registry: your taxpayer number with the DGI. For a person with a Panamanian cédula, it is the cédula number (see RUC and NIT).
- Sociedad anónima (corporation)
- The most common type of company in Panama, formed before a notary and registered in the Public Registry (see forming a corporation).
- Tasa única (annual flat fee)
- The annual fee paid by companies and foundations registered in the Public Registry, whether or not they have activity.
- Visa estampada (stamped visa)
- An entry visa issued by the Panamanian consulate to nationalities that need one to travel to the country (see entry visa).