What follows is the SARS version. The correct explanation appears below:

MUTUAL AGREEMENT PROCEDURE (MAP)

What is a MAP?

MAP is a procedure which allows the Competent Authorities or designated representatives of the Competent Authorities from the governments of the Contracting States/Parties to interact with the intent to resolve international tax disputesTax Disputes arise when there is a disagreement between taxpayers and tax authorities regarding the interpretation or application of tax laws. These disputes may concern various issues such as the accuracy of a tax return, the eligibility for tax deductions or credits, the correct amount of tax liability, or transfer pricing adjustments. Tax disputes can lead to lengthy legal proceedings....

MAP is provided for in an Article in a Double Taxation AgreementA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and... (DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and...) and can involve matters containing juridical double taxationDouble Taxation occurs when the same income or financial transaction is taxed twice, typically in different jurisdictions. It can arise in two primary contexts: economic double taxation, where the same income is taxed twice in the hands of different taxpayers, and juridical double taxation, where the same taxpayer is taxed on the same income in more than one country. Double... cases, as well as inconsistencies in the interpretation or application of a DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and....

What is a Competent Authority?

DTAs are usually concluded between the governments of two countries. These countries are then referred to as the Contracting States or Contracting Parties to such an agreement.

“Competent Authority” is a term used in tax conventions or agreements to identify a position, a person or a body to whom issues can be addressed within a Contracting State.

The Competent Authority in South Africa is the Commissioner for SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... and duties have been delegated to designated representatives in the Legislative Research & Development Subdivision within Legal & Policy.

What is the function of a Competent Authority?

The Competent Authority in a Contracting State/Party is charged with the responsibility to interact with its counterparts in any matters arising between the different Contracting States/Parties pertaining to the interpretation or the application of a DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and..., and to resolve any international tax disputesTax Disputes arise when there is a disagreement between taxpayers and tax authorities regarding the interpretation or application of tax laws. These disputes may concern various issues such as the accuracy of a tax return, the eligibility for tax deductions or credits, the correct amount of tax liability, or transfer pricing adjustments. Tax disputes can lead to lengthy legal proceedings... that might arise.

A Competent Authority is generally committed to ensure a good faith application of a DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and.... The Competent Authority endeavours to resolve requests from their counterparts in accordance with a particular DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and....

How does it work?

The DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and... permits a mutual agreement procedure (MAP) for resolving difficulties arising from the application of a DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and... in the broadest sense of the term.

It basically authorises the Competent Authorities or their designated representatives to communicate with each other directly, including through joint commissions, for the purpose of resolving the matters that might be brought before them.

A MAP Request for Assistance may deal with any of the following subjects:

• Transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... adjustment requests
• Attribution of profits of a permanent establishment
• Dual residence of individuals and persons other than individuals
• Withholding tax levied beyond what is permitted by the applicable DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and...
• Any other case in which a person considers that the taxation is not in accordance with the applicable DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and...

Depending on the relevant subject, the MAP request will be routed into one of two channels, i.e.-

• Transfer Pricing MAP
  or
• Interpretation MAP

MAP Request for Assistance

It is a request from one Competent Authority of a particular DTA’s Contracting State/Party, to the Competent Authority of the other Contracting State/Party, under a particular DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and..., to resolve any international tax disputeTax Disputes arise when there is a disagreement between taxpayers and tax authorities regarding the interpretation or application of tax laws. These disputes may concern various issues such as the accuracy of a tax return, the eligibility for tax deductions or credits, the correct amount of tax liability, or transfer pricing adjustments. Tax disputes can lead to lengthy legal proceedings....

Step 1

In cases where the taxation which is not in accordance with the DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and... has been imposed, the taxpayer must first raise the issue with the relevant State as agreement by the other State will negate the need for a MAP.

Read all about the South African procedures here:

• Request for Correction
• Objections
• Appeals

Step 2

If unsuccessful, the taxpayer may then approach the Competent Authority of his/her country of residence to request a MAP under the relevant DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and....

If the Competent Authority in the country of residence cannot itself resolve the matter, but is in agreement with the taxpayer’s request for a MAP, the Competent Authority will take up the matter with the Competent Authority of the other Contracting State/Party under the specific DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and....

What to submit & Where to submit it

SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently..., as the Competent Authority, requires certain minimum information to be included in a MAP Request, whether it is for a Transfer PricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... MAP Request or an Interpretation MAP Request.

The types of MAP Requests, the minimum information required per type, and the relevant email address to be used per type, are set out in the table below.

Here is the correct explanation:

Uganda/RSA DTAA Double Taxation Agreement (DTA), also known as a Double Taxation Treaty (or a Tax Treaty), is an international tax treaty between two or more countries that aims to prevent individuals or businesses from being taxed twice on the same income. With globalisation and the increase in cross-border economic activities, DTAs have become essential tools for promoting trade, investment, and... for instance:

1. Where a person considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with this Convention, he may, irrespective of the remedies provided by the domestic law of those States, present his case to the competent authority of the Contracting State of which he is a resident or, if his case comes under paragraph 1 of Article 24, to that of the Contracting State of which he is a national. The case must be presented within three years from the first notification of the action resulting in taxation not in accordance with the provisions of the  Convention.

OECDThe Organisation for Economic Co-operation and Development (OECD) is an international organisation comprising 38 member countries, established to foster economic growth, trade, and development on a global scale. Founded in 1961, the OECD provides a forum for governments to collaborate, share policy experiences, and develop solutions to common economic challenges. The OECD's core mission is to promote policies that improve... Commentary on A25:

14. It should be noted that the mutual agreement procedure, unlike the disputed

claims procedure under domestic law, can be set in motion by a taxpayer without

waiting until the taxation considered by him to be “not in accordance with the

Convention” has been charged against or notified to him. To be able to set the

procedure in motion, he must, and it is sufficient if he does, establish that the “actions

of one or both of the Contracting States” will result in such taxation, and that this

taxation appears as a risk which is not merely possible but probable. Such actions

mean all acts or decisions, whether of a legislative or a regulatory nature, and whether

of general or individual application, having as their direct and necessary consequence

the charging of tax against the complainant contrary to the provisions of the

Convention. Thus, for example, if a change to a Contracting State’s tax lawTax laws form the backbone of any nation’s revenue system, setting the rules that govern how individuals and corporations contribute financially to support government functions. These laws define the types of taxes, the applicable rates, and the regulations regarding payment and compliance. They also outline the rights and obligations of taxpayers, ensuring a balanced and fair approach to funding public... would result

in a person deriving a particular type of income being subjected to taxation not in

accordance with the Convention, that person could set the mutual agreement

procedure in motion as soon as the law has been amended and that person has derived

the relevant income or it becomes probable that the person will derive that income.

Other examples include filing a return in a self assessment system or the active

examination of a specific taxpayer reporting position in the course of an audit, to the

extent that either event creates the probability of taxation not in accordance with the

Convention (e.g. where the self assessment reporting position the taxpayer is required

to take under a Contracting State’s domestic law would, if proposed by that State as an

assessment in a non-self assessment regime, give rise to the probability of taxation not

in accordance with the Convention, or where circumstances such as a Contracting

State’s published positions or its audit practice create a significant likelihood that the

active examination of a specific reporting position such as the taxpayer’s will lead to

proposed assessments that would give rise to the probability of taxation not in

accordance with the Convention). Another example might be a case where a

Contracting State’s transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... law requires a taxpayer to report taxable incomeThe tax base is a fundamental concept in taxation, representing the total amount of economic activity or assets upon which a tax is levied. It is the foundation upon which governments calculate the amount of tax owed, based on factors like income, property value, sales, or corporate profits. Understanding the tax base is essential for tax professionals, businesses, and policymakers,... in

an amount greater than would result from the actual prices used by the taxpayer in its

transactions with a related party, in order to comply with the arm’s length principleThe Arm’s Length Principle (ALP) is a cornerstone concept in international taxation and transfer pricing. It requires that transactions between related parties, such as subsidiaries or affiliates within a multinational enterprise (MNE), mirror those that would occur between independent entities under similar circumstances. This principle ensures that each entity within an MNE is compensated fairly and transparently, based on the...,

and where there is substantial doubt whether the taxpayer’s related party will be able

to obtain a corresponding adjustment in the other Contracting State in the absence of

a mutual agreement procedure. As indicated by the opening words of paragraph 1,

whether or not the actions of one or both of the Contracting States will result in

taxation not in accordance with the Convention must be determined from the

perspective of the taxpayer. Whilst the taxpayer’s belief that there will be such taxation

must be reasonable and must be based on facts that can be established, the tax

authorities should not refuse to consider a request under paragraph 1