Operations & compliance
Mutual agreement procedure
The mutual agreement procedure, or MAP, is a treaty-based mechanism allowing the competent authorities of two countries to negotiate and resolve cases where a taxpayer faces double taxation, most commonly following a transfer pricing adjustment made by one country's tax authority that the other country has not mirrored.
A taxpayer initiates MAP by submitting a request to the competent authority in one of the relevant countries, typically within a treaty-specified time limit, after which the two authorities negotiate directly with each other, though the taxpayer generally has limited direct involvement once the process is under way.
MAP cases can take several years to resolve and there is no guarantee of a full outcome, since the two authorities are not obliged to reach agreement, which is why groups increasingly prefer pursuing an advance pricing agreement upfront where the transaction and amounts involved justify the additional cost. This matters in.
In practice
What matters when applying mutual agreement procedure
- Check treaty MAP time limits before adjustment finalises
- Submit the request promptly to the competent authority
- Expect limited direct involvement once MAP starts
- Budget for a multi-year resolution timeline
- Consider an APA to avoid MAP altogether
Frequently asked
Common questions
What triggers a MAP case?+
A transfer pricing adjustment by one country's tax authority that creates double taxation because the other country involved has not made a corresponding adjustment typically triggers MAP.
How long does MAP typically take?+
MAP cases often take several years to resolve, since the two competent authorities negotiate directly and there is no fixed deadline forcing a faster outcome. This matters in practice.
See how the tooling handles this in practice
Our transfer pricing tools calculate intercompany charges, benchmark financing and reconcile the intercompany ledger from your own data. Book a short walkthrough and we will show the workflow on a scenario that matches your group structure, rather than a generic demo dataset.