Transfer Pricing in Panama 2025: Keys and Obligations with José Galíndez and Frida Medrano “AmCham Panama”.

The 2025 transfer pricing webinar examines the novelties and obligations of this regime, highlighting the importance of regulatory compliance to avoid tax penalties. In the presentation, José Galíndez and Frida Medrano, partners at Galíndez, Medrano y Asociados, share their extensive knowledge and experience to analyze both technical and strategic aspects, as well as the changes in Panamanian law and their implications for taxpayers in related-party transactions.

Keys and Obligations with José Galíndez and Frida Medrano “AmCham Panama”.

Main points discussed:

From the outset, José Galíndez and Frida Medrano highlight that transfer pricing compliance is not only a technical requirement but also a strategic tool for companies, helping them to minimize tax risks and optimize their operations under the supervision of the Directorate General of Revenue (DGI).

The linkage between companies is key to defining obligations, and both experts explain how direct or indirect relationships impact those tax obligations.

José and Frida detail the administration and control of transactions between related entities, considering aspects such as shareholding and contractual links that influence the tax environment.

They emphasize that non-compliance with formal obligations, such as the filing of the income tax return and the transfer pricing report, may result in high penalties, including fines of 1% of the total amount of transactions.

Frida Medrano explains the importance of preparing the documentation required by the tax administration, such as studies and price analysis, which must include audited financial statements to avoid penalties.

José Galíndez emphasizes the need to strictly comply with articles 10 and 11 of decree 390, warning that lack of information may result in severe fines, and comments on the new regulations applied by the office of large taxpayers for a better control of intra-group transactions.

Regarding the methodology, both partners highlight the need to follow the tax code and the OECD guidelines to select the appropriate method, with special emphasis on the comparability analysis and the impact of the global minimum tax adopted by more than 44 jurisdictions.

The requirement to justify methodological changes in the reports to ensure their acceptance by the DGI is also addressed; José Galíndez and Frida Medrano emphasize that the documentation must be accurate to avoid tax challenges.

They also discuss the risks derived from the use of the “Berry ratio” indicator to evaluate corporate profitability, Frida Medrano pointing out that its sensitivity to accounting classification may generate rejection by the tax administration if it is not used with care.

Finally, José and Frida warn that timely reporting is vital to avoid very high fines, which can reach up to one million dollars, and stress the importance of responding within the established deadlines to maintain legality and avoid international tax conflicts.

With the expertise and leadership of José Galíndez and Frida Medrano of Galíndez, Medrano y Asociados, this webinar offers a comprehensive and strategic guide to successfully address transfer pricing obligations in Panama during 2025.

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