The Ministry of Finance published the Explanation\u00a0regarding\u00a0Mutual Agreement Procedure (\u201cMAP\u201d) as per Double Taxation Avoidance Treaties (\u201cDTTs\u201d).<\/p>\n
MAP\u00a0as per\u00a0DTTs\u00a0is an international procedure which provides a unique application of\u00a0DTTs. This procedure is a unique instrument used for solving international tax disputes and regulated by existing\u00a0DTTs\u00a0(usually it\u00a0is prescribed\u00a0in Article 25 \u2013 Mutual Agreement Procedure).<\/p>\n
In accordance with\u00a0provisions of\u00a0DTT\u00a0in question, the competent authority of the Republic of Serbia\u00a0is entitled\u00a0to communicate with the competent authority of another contracting country,\u00a0to\u00a0reach an agreement of taxation in Serbia or another contracting country.<\/p>\n
MAP\u00a0is initiated\u00a0based on the request of the competent authority. The competent authorities\u00a0are obliged\u00a0only to strive to solve the case by joint negotiation, which does not mean that such agreement will and\u00a0must be\u00a0achieved. The purpose of MAP of competent authorities is to enable the realization of the rights from the\u00a0DTT\u00a0for the entity on which the regulations of international agreements\u00a0are applied, according to the legal system of contractual countries.<\/p>\n
In Serbia, the Ministry of Finance is competent for providing\u00a0assistance\u00a0with respect to MAP in\u00a0DTTs. This\u00a0assistance\u00a0is free of charge. The taxpayers do not\u00a0take part\u00a0in the procedure of joint negotiation between competent authorities even if the procedure starts upon their request. They are expected to\u00a0cooperate\u00a0fast and effectively with the competent authority, during the MAP. The notifications that\u00a0are exchanged\u00a0during the MAP\u00a0are considered\u00a0as a tax secret.<\/p>\n
The\u00a0request\u00a0must be\u00a0submitted right after the first notification of measurement in Serbia or another contractual country which leads to taxation which is incompatible with provisions of\u00a0DTT.<\/p>\n
The\u00a0request\u00a0for initiation of a MAP\u00a0can be\u00a0submitted by entity\u00a0concerning\u00a0DTT\u00a0in question. The request\u00a0is submitted\u00a0to the competent authority of the country of residence of the entity\u00a0concerning\u00a0DTT\u00a0in question. In Serbia, requests in written form\u00a0are being sent\u00a0to the Ministry of Finance \u2013 fiscal system department. The request, as well as\u00a0appropriate\u00a0documentation,\u00a0will be submitted\u00a0in written form on the Serbian language, but it\u00a0is preferred\u00a0to\u00a0submit\u00a0the request in English as well.<\/p>\n
In the case of double tax residency, the request is submitted in the contractual country in which the entity considers\u00a0to be\u00a0a tax resident. If the taxpayer changes its residency status\u00a0in order to\u00a0avoid double taxation\u00a0in accordance with\u00a0international agreements, the request will be submitted to the competent authority of the country where the taxpayer was resident\u00a0in the moment of\u00a0crystallization of tax liability.<\/p>\n
Submission of\u00a0request\u00a0for starting MAP does not postpone\u00a0the execution of\u00a0the decision on tax liability.<\/p>\n
Stipulations prescribed by\u00a0DTTs\u00a0have priority compared to the regulations in tax laws and other laws of the Republic of Serbia.<\/p>\n
If the competent authority estimates that all material terms for conducting the procedure\u00a0are fulfilled, it starts the bilateral phase MAP with the competent authority contracting state. In specific cases, the procedure\u00a0can be\u00a0finished one-sided \u2013 by using\u00a0appropriate\u00a0legal means of Serbian legislation. MAP\u00a0is being proceeded\u00a0directly between competent authorities of two countries.<\/p>\n
Since\u00a0the content of\u00a0such international procedure is consultative nature, the taxpayers are not participating by themselves. They are only provided with information about the result of the procedure, usually, 2 months after the agreement\u00a0was concluded. In specific cases, the MAP can last longer.<\/p>\n
The opinions\u00a0are exchanged\u00a0in written\u00a0form. If it is necessary to\u00a0provide\u00a0additional\u00a0explanation of the circumstances of the concrete case, the taxpayer must\u00a0cooperate\u00a0proactively, transparently and in good faith with the competent authority, as well as\u00a0provide it with\u00a0all necessary information and documentation. The taxpayer cannot ask form the competent authority to partially apply the Decision brought in the procedure of joint negotiation.<\/p>\n
For additional questions, you can contact our tax team at tax@confida.rs.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Ministry of Finance published the Explanation\u00a0regarding\u00a0Mutual Agreement Procedure (\u201cMAP\u201d) as per Double Taxation Avoidance Treaties (\u201cDTTs\u201d). MAP\u00a0as per\u00a0DTTs\u00a0is an international procedure which provides a unique application of\u00a0DTTs. This procedure […]<\/p>\n","protected":false},"author":1,"featured_media":2156,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[4,5,6],"tags":[],"_links":{"self":[{"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/posts\/2155"}],"collection":[{"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/comments?post=2155"}],"version-history":[{"count":1,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/posts\/2155\/revisions"}],"predecessor-version":[{"id":2157,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/posts\/2155\/revisions\/2157"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/media\/2156"}],"wp:attachment":[{"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/media?parent=2155"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/categories?post=2155"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.confida.rs\/de\/wp-json\/wp\/v2\/tags?post=2155"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}