Mutual Agreement Procedure Ksa

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The POPs guidelines provide that subjects applying for POPs must provide gazT with transfer pricing documentation in addition to the information necessary to justify the case. There is therefore no arbitration provision in all saudi Arabia`s tax treaties in the event of an agreement between the two contracting states, the case cannot be referred to arbitration. The MAP is a procedure by which the competent authorities consult and discuss international tax disputes, including transfer pricing disputes (PT), and avoid double taxation resulting from acts of one or two contracting states leading to taxation that does not comply with the applicable double taxation treaty (DTT). Please note that all KSA DTTs contain a MAP rule. The competent authorities may also attempt to reduce double taxation in cases that are not covered by the tax treaty by attempting to resolve the matter by mutual agreement with the competent authority of the State party. Examples cited in the guidelines, in which a subject may apply for an exemption, include: the subject is considered a national country of the two states or in the absence of an agreement on the state of residence; The subject with the tax authorities does not refer to the existence of a stable institution or the characterization of certain income items for the purposes of the dual taxation convention; The subject does not agree with the tax authorities on the interpretation and application of the provisions or principles of the double taxation convention; transfer pricing adjustments have taken place or will occur between associated companies in different states; adjustments in profits attributable to a stable establishment in a state of another state have occurred or will occur; the taxpayer disagrees with the tax authorities who have corrected whether the application of national anti-abuse legislation is contrary to the provisions of a double taxation convention. The guide provides a detailed overview of the information needed to submit an MAP application and the MAP`s interaction with the national procedures already available. The Saudi Arabian Tax Administration has published the Guidelines for The Subjects for the Mutual Agreement Procedure (POP), which allows subjects to seek assistance from the competent authority of Saudi Arabia to resolve tax disputes that do not comply with the provisions of the relevant double taxation agreements. Subjects who are currently faced with probable or definitive assessments of transfer pricing may consider how the suspension of national proceedings and GAZT`s request to settle the matter with another competent authority can benefit their case. Another interesting observation will be to what extent taxpayers who have regional headquarters in low or no tax areas (. B, for example, the United Arab Emirates) will benefit from Saudi Arabia`s POPs.

In accordance with the provisions of the double taxation conventions signed by the KSA and the resolution of the difficulties that arise when the actions of one or both of the contracting states lead to imposition contrary to the provisions of the Convention, the general authority of the Zakat-Tax (GAZT) will endeavour to resolve these cases in agreement with the competent authority of the other State party.

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