Panama's New Corporate Tax Machines - WHAT?

Day 151 Wednesday (Miercoles) - Panama City

OK, so like everywhere in the world you have taxes to pay. Income taxes if you make money as an individual, Corporate taxes if you run and oprate a business. Panama is no different.

But, here in Panama they are incorporating something new called the Fiscal Printer that all businesses starting tomorrow, March 1st have to start using to track tax dollars. Now these machines can run between $1000-$2000 a pop and then you have to have some kind of monthly maintenance agreement with the maker to make sure the darn thing works.

As in any law, exceptions rule the roost and I am here to show you what those exceptions are. This information came out yesterday the 28th of February.

Have fun if this pertains to you, as you can see below the exception list is pretty extensive and you should always consult your tax attorney to make absolutely sure you are exempted. Please pardon some of the sentence structure as the translation is not always perfect.

EXCEPTED PERSONS USING EQUIPMENT TAX

 By: Augusto Garcia
 According to current regulations on implementation of Fiscal equipment, all persons performing operations related to the transfer or sale of goods and services, are required to document their transactions through tax receipts issued by duly authorized equipment by the DGI. The use of such equipment is required by all businesses required to do so from March 1, 2012.
 This problem has significant importance if we consider that in principle all other invoices and equivalent documents until March 1 have been used in commercial transactions are abandoned, with tax receipt or tax bill the only valid document to document this such transactions and to support the costs and accounting costs taxpayers before the DGI.
 Based on the above is necessary to clarify the people who are expressly exempted from the use of Equipment Tax, and therefore are entitled to use other evidence other than those issued by the Tax Team. These people include the following exception:
 1. Agricultural activity whose annual gross taxable income are less than two hundred fifty thousand dollars (B/.250, 000.00): Agricultural activity covers production of feed, salt, timber, agricultural raw materials, poultry, livestock and forestry homegrown grains such as rice, maize, sorghum and other agricultural products.
 2. The transfer of real estate property and those which must be given or appearing on public documents.
 3. The public transport of passengers, nationally and internationally by land, air or sea à covers the public transport system (Metrobus) and passenger transport on inland routes and airlines, and shipping.
 4. The cargo transport services of petroleum products.
 5. Operations and general services made ​​by banks and other financial institutions, including leasing companies and investment funds and the activities of the banks credit or financial fiduciary governed by special laws, cooperatives, institutions and savings funds, pension funds, retirement funds and social security and savings and loan institutions.
 6. The operations performed by the stock exchanges and authorized products to operate in Panama.
 7. The services provided under the dependency ratio in accordance with the Labour Code includes wage laborers.
 8. The services provided in liberal professions, craft and art, independently or through civil societies: Examples of professions include lawyers, architects, accountants, engineers, doctors and others. These professionals should use when developing its Fiscal equipment profession through corporations.
 9. Individuals or legal entities engaged in sales activities of products or services through vendors who do not use motor vehicles. Those who use motor vehicles for the development of these activities are not required to use the equipment Prosecutors are authorized until fiscal printers phones.
 10. The activity of renting of buildings under contracts notarized or registered in the Ministry of Housing and Land Management, conducted by individuals or corporations to manage their own property without the intervention of third parties.
 11. The activities of the co-owners associations related to the collection of maintenance fees to meet the horizontal property regime.
 12. The activities of commission agents corresponding to reimbursable expenses in which case they may be documented by non-tax receipts. The DGI regulate this provision.
 13. Institutions, associations and nonprofit associations in the country, provided they are duly authorized to receive donations deductible by the Internal Revenue Service: The DGI has clarified that in the case of such entities, they are not required to Prosecutors used equipment from its registration with the Ministry of Government. However, for purposes of deductions of income tax proceeds of donations made ​​to such entities, they are required to be registered with the DGI.
 14. Private entities duly authorized by the Panama Maritime Authority to ensure compliance with building regulations, navigation, pollution prevention and safety of merchant ships, passenger transport, leisure, scientific research, work, oil exploration and drilling of international traffic, whether or not registered in the Merchant Marine of Panama.
 15. The hostels that are less than seven quarters. The hostels are defined as the tourist facility operated by an individual or family with their own room or house owners, characterized by small establishments providing personalized service and offer regional home cooking, and its construction is closely related to architecture popular in the area.
 16. Any other activity which by its nature or volume of transactions in the opinion of the Department of Revenue should be exempted from the use of tax teams, however, the Directorate may request information necessary to monitor the obligation to document as if fiscal printer.
 17. The fuel stations are not required to use equipment prosecutors, and may continue to use manual or pre-printed invoices duly authorized by the DGI.
 18. The companies involved Freight shall not be obliged to use Tax Team, until there are no local market portable Fiscal Teams: This exception covers all types of cargo including sending parcels.
 19. Businesses engaged in leasing of vehicles, are obliged to use Equipment Tax only for the daily close of their operations. -> The above implies that they are not required to issue tax receipts for each lease made.
 20. The Toll Collection Booths that is owned by the National Highway Company (ENA), are not obliged to use the equipment tax is to be noted that the sale of the northern corridor to ENA has not been completed, which is why the tollbooths of this corridor should use fiscal printers. In the case of the southern corridor is not necessary to issue tax receipts.
 21. Companies with massive turnover namely:
 • Electric Companies
 • Telecommunications Companies
 • Cable Television
 • Wholesale Distributors (Café Duran, FEDURO, etc..) Provided they maintain a turnover in excess of 85.000 monthly impressions.
 • This exception is necessary for the DGI clarify whether these companies will be granted a certificate stating his condition except for the use of equipment Prosecutors.
 22. The sites identified by Provinces, Districts, Counties, Villages, and areas populated place in the list attached to the resolution of the Director General of Revenue No. 201-10796 (locations nationwide are considered as "Hard to Reach"), not Teams are required to purchase Tax.
 23. Homeland areas where there is no electricity, no Tax shall use equipment.
 Small traders with a turnover less than B /. 36,000.00 per year are not exempt from use equipment expressly Fiscal and therefore must use the teams. The DGI has given them the option to have in case you do not wish to use this equipment, submit a formal application to the DGI, and are subject to an audit to verify that their income is less than the sum mentioned above.

Want to protect against the effects of Alzheimer's? Learn another language.

Day 150 Tuesday (Martes) - Panama City

So the title of our blog I am sure caught many of you by surprise, but it is another reason to think about moving to Panama. Learn Spanish along with your native language and you could maybe keep Alzheimer's at bay for a few more years.

I found this article of interest so thought I would share it as Alzheimer's is an awful thing to watch a loved one go through.

Here is the link to the full article Click here for more information

See what happens when gas goes up!

Day 149 Monday (Lunes) - Panama City

OK, everyone is starting to see gas go up all over the globe, I am sure this is not a surprise to anyone as the world is in a quandry and oil, well, it will rise and rise again.

So with that being on the table see what the Panama Man is traveling with now.

OK, maybe not traveling with, but you get the point, life as we know it cannot be sustained when we rely so heavily on something like Oil that we cannot control. What we can control is moving to a place like Panama where (besides gas prices) most daily living expenses are far below Europe and North America, and everywhere else for that matter. Panama does have inflation, as prices do go up, but the economy is solid and growing.

So Come to Panama and Turn Your Frown Upside Down.

Are we making it big now?

Day 148 Sunday (Domingo) - Playa Coronado

this is a travel site that discusses many aspects of living abroad, and guess who made this weeks copy?????  O yeah, the Panama Man did. OK small plug but nevertheless, we are moving on up.

Check it out.

Living Abroad: Reality vs. Marketing Hype

By Ilene Little on Saturday, February 11, 2012

Living in Panama

Sovereign Man in Panama, show host Rich Novak
Every show features expats telling their experiences; why they left their home country, how they ended up in Panama, and how they made the transition to living abroad.  You can call into the show to get your own questions answered by people who “have been there and done that”.
Listening to Novak will also alert you to any changes in U.S. or Panamanian law that may influence your strategy to move abroad and protect your assets from being adversely affected by a government entity.
For example, on a recent broadcast Novak predicted how the US Hiring Incentives to Restore Employment Act (“HIRE Act”) is considered by many to be a draconian new tax regime that will negatively affect anyone trying to transfer money abroad after December 31, 2012.
“It was enacted to revitalize employment, but they tacked on provisions that require a citizen of the US who wants to transfer money overseas, to send 30% into the government and then ‘try’ to get the money back from the government,” said Novak.
Sovereign Man in Panama! Broadcasts LIVE each & every Thursday from 4PM to 6PM Eastern Time.  Expatriate guests frequently appearing on Sovereign Man’s Show include:

• Panama Man–Life’s about a Panama Beach – aPanamaRetirement.blogspot.com

Day 147 Saturday (Sabado) Playa Coronado

Hot Hot Hot today, did some walking, did some shopping, did some tree climbing for some grapefruits and coconuts. NOW it is time to rest and relax poolside. It seems we never really do that, rest and relax by the pool for an afternoon. It is funny that you think when you live a vacation lifestyle you would ONLY hang by the pool, but somehow we become busy and only dip in here and there. Don't feel sorry for us, I am just saying.

OK, enjoy your snow or cold wherever you are (OK maybe you are having a mild winter) but 86 degrees or 30 degrees you make the choice and I don't mean 30 celcius

Salud

Day 145 and Day 146, double trouble

OK, so I was lacking in my blog yesterday as I thought I would have gotten it done after the radio show, buttttt that just did not happen, so here I am banging out 2 days worth of gibberish.

First, the radio show was a good one, plenty of plugs for this blog, great CD rates (4-8%) and a beautiful condo building here in Coronado.

For more information on any of the above just drop me an email at The Panama Man and I will get you particulars.

TGIF today, the week seemed to fly by as Carnival worked its way through to an end on Wednesday, such activity throughout the country this past week. It was fun to be here and experience it.

Let's check out a couple of radio picks of our guests.

Have a great day today and more blogging tomorrow.

Let's talk visa's

Day 144 Wednesday (Miercoles) = Playa Coronado

So, we are approaching our 180 day tourist visa limit. What that means is we have to leave Panama for 72 hours before we can return.  In our case we are flying back to the states, specifically Chicago to visit our youngest daughter. I know what you are thinking, Chi-town in March? dumb-asses, leaving high 80's for 30,40, maybe 50!!!

We are considered pters, perpetual tourists, you can just always leave every 180 days forever, yet there are more permanent ways.

Pensionado is the most popular - show a guaranteed income from some sort of pension of $1200 and you get a permanent resident visa. which means you do not have to leave.

Another way to gain permanent residency visa is through economic or self solvency. 300,000 in property or a time deposit 5 year term gets you to stay.

Now these things often, so always check updated information before deciding'

As for us? Well we will stay pters for awhile, but economic solvency is a good avenue we are exploring. NOW, this does not mean you give up citizenship' it only means you do not have to leave Panama, that's all.

ok for now. radio show tomorrow and the panama man will be live for a couple of segments, be sure to tune in at 4pm eastern time. www.overseasradio.com