Transfer pricing

2 Making a MAP request - 2.2. How to make a request for competent authority assistance - 2.2.1

 

 
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2 Making a MAP request

2.2. How to make a request for competent authority assistance

2.2.1. General format of a MAP request

In cases where there are no prescribed forms for requesting competent authority assistance, the taxpayer should provide the following relevant information, if applicable:

  1. the name, address, and taxpayer identification number of the taxpayer;
  2. for transfer pricing cases, the name, address and, if possible, the taxpayer identification number of any related foreign taxpayer involved;
  3. the name of the foreign tax administration involved and if possible identification of the regional or local tax administration office that has made, or is proposing to make, the adjustment (if relevant);
  4. the tax convention article(s) that the taxpayer asserts is not being correctly applied, and the taxpayer’s interpretation of the application of the article;
  5. the taxation years or periods involved;
  6. the relationship, situation, or structure of the transactions, issues, or related parties involved (advising of any changes in these matters that occur after the request has been filed would be helpful);
  7. a summary of the facts and an analysis of the issues for which competent authority assistance is requested, including any specific issues raised by the tax administrations affecting the taxpayer and the related amounts (in both currencies and supported by calculations, if applicable);
  8. for transfer pricing cases, documentation as described in domestic legislation of the taxpayer's state of residence, if available (where documentation is inordinately voluminous, a description of the documentation prepared in connection with the transactions which are the subject of the MAP request may be acceptable);
  9. a copy of any other relevant competent authority request and the associated documents filed, or to be filed, with the competent authority of the other contracting state, including copies of correspondence from the other tax administration, copies of briefs, objections, etc., submitted in response to the action or proposed action of another tax administration (if applicable, translated copies are helpful and where documentation is voluminous, a description of the documentation may be acceptable); 
  10. an indication of whether the taxpayer or a predecessor has made a prior request to the competent authority of either contracting state on the same or related issue;
  11. a schedule of the time limitations in each jurisdiction (domestic as well as tax convention time limits) in respect of the years for which relief is sought (in cases of multiple taxpayers, a schedule for each);
  12. a statement indicating whether the taxpayer has filed a notice of objection, notice of appeal, refund claim, or comparable document in either of the relevant jurisdictions;
  13. where the request for competent authority assistance involves issues that are currently or were previously considered by the tax authorities of either contracting state as part of an Advance Pricing Arrangement (APA), ruling, or similar proceedings, a statement to that effect;
  14. if consent has not already been provided for a person to act as an authorized representative, a signed statement that a representative is authorized to act for a taxpayer in making the request;
  15. any other facts that the taxpayer may consider relevant;
  16. a copy of any settlement or agreement reached with the other jurisdiction which may affect the MAP process; and 
  17. the taxpayer’s views on any possible bases on which to resolve the issues.

The request should generally be signed by the taxpayer, or by an authorized person on behalf of the taxpayer, confirming the accuracy and completeness of the facts and information presented in the request.  Alternatively, an accompanying document, stating as much, may be provided within a reasonable period of time after the submission.

Typically there are no fees charged by the competent authorities for MAP cases.  There may be fees associated with APA programs (discussed elsewhere in the manual) or for the rare occurrences of using independent experts or mediators.

Best Practice Nº5:   Providing complete, accurate, and timely information to the competent authorities

The completeness and accuracy of the information included in a request has a direct impact on the time required for the competent authorities to carry out the MAP process.  To deal with a case in an expeditious manner, a competent authority needs sufficient details to analyse, understand, and ultimately prepare to discuss a position with both the taxpayer and other competent authority.

Ensuring both competent authorities have the same information at approximately the same time will facilitate a common understanding of the facts and will undoubtedly encourage earlier resolution.  Therefore, copying the other competent authority on both submissions of information and subsequent requests will reduce the risk of misunderstandings.  If two competent authorities receive conflicting information, the outcome will likely be a delay in the MAP process until the parties can agree upon the information or facts presented.

Certain competent authorities may delay acceptance of a case where a taxpayer has failed to provide complete and accurate information or may deny competent authority assistance where the taxpayer has misrepresented facts.  

Best Practice Nº6:   Allowing electronic submissions

For the benefit of the tax administration and taxpayer, electronic correspondence and copies of a competent authority submission are often helpful in encouraging simultaneous delivery of information to the two competent authorities.  Electronic copies may also ease the burden of submission for the taxpayer while facilitating the administration of a request by the competent authority.  Some governments may not currently accept this medium of submission, while other governments may with a disclaimer. 

 


 

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