An analysis by Borden Ladner Gervais, Taxand Canada
The Canada Revenue Agency recently released its 2021 report summarising its Mutual Agreement Procedure (“MAP”) program for that year. The MAP program is an important dispute resolution tool for taxpayers to resolve international tax disputes, in particular involving transfer pricing.
Steve Suarez, Partner at our Canadian firm Borden Ladner Gervais,has analysed and highlighted some key takeaways from the report, including:
The CRA closed 81 negotiable cases during the year and accepted 109 new cases. At the beginning of 2021, there were 167 ongoing negotiable cases.
The average time to complete a negotiable MAP case submitted after 2015 was 20.6 months. Cases initiated by Canada were resolved more quickly than those initiated by other countries.
Canada initiated 77% (57 out of 74) of the post-2015 MAP cases closed in 2021, while the remaining cases were initiated by other countries.
Out of the 74 post-2015 MAP cases closed in 2021, 49% (36 cases) resulted in full relief from double taxation through negotiation, and an additional 15% (11 cases) were resolved through unilateral relief.
Cases involving the United States accounted for nearly 40% of Canada’s active MAP cases in 2021, while the rest were distributed across 29 other countries.
