Abu Dhabi: The Ministry of Finance has issued Mutual Agreement Procedure (MAP) guidance to provide clarity and guidance to taxpayers on the eligibility of MAP, the MAP process, and the information required for a MAP claim. The Mutual Agreement Procedure offers taxpayers the possibility to seek relief from (economic) double taxation under the applicable double tax treaty.

According to Emirates News Agency, the MAP Guidance provides clarity to taxpayers on the scenarios where double taxation may occur, such as a tax assessment resulting in a cross-border transfer pricing adjustment or the determination of the existence of a cross-border permanent establishment. The guidance also clarifies the timelines in which taxpayers must make a MAP claim, typically within three years from when a taxpayer is aware that double taxation may occur.

The guidance confirms that rulings on tax matters issued by a UAE domestic judicial court or the Tax Dispute Resolution Committee may impact the scope of relief that the UAE Competent Authority can provide if such cases are submitted to MAP. Importantly, the MAP guidance outlines a detailed list of information required from taxpayers wishing to submit an eligible MAP claim. It also states that the UAE Competent Authority will seek to resolve all MAP cases as soon as possible and within the best practice timelines prescribed by the Organisation of Economic Cooperation and Development (OECD), contingent on the timely submission of relevant information from taxpayers and the availability of the Competent Authority of the counterparty jurisdiction.

Given the extensive tax treaty network that the UAE maintains, the MAP guidance is essential information for taxpayers considering relief from double taxation. It helps verify the eligibility of their MAP claim before submission and determine which jurisdiction should receive their MAP claim. The publication of the MAP guidance is designed to provide taxpayers with direction on how to access the MAP process, benefit from the UAE's tax treaty network, and ultimately seek to relieve instances of double taxation.

The publication of the MAP guidance reaffirms the Ministry of Finance's commitment to ensuring certainty and transparency for UAE taxpayers.