On 31 March 2015, the Austrian Ministry of Finance published a decree dealing with, inter alia, mutual agreement procedures under double tax treaties.
Currently, Austria has concluded 85 double tax treaties, all of which contain provisions on mutual agreement procedures (MAPs). However, Austrian statutory law does not provide for procedural rules for such procedures. Until recently, it was in particular unclear in which form an Austrian taxpayer can initiate an MAP. The new decree of the Austrian Ministry of Finance aims at giving guidance on the initiation of MAPs and also in respect of arbitration procedures under double tax treaties and the EU Arbitration Convention.
Pursuant to the decree, if a taxpayer aims at encouraging an MAP the case must be presented in writing to the Austrian Ministry of Finance's Department for International Tax Law. The submission shall in particular contain the following information: (i) the taxpayer's details; (ii) the competent tax office; (iii) an outline of the facts and circumstances of the case; (iv) the relevant tax period; (v) an explanation why the taxpayer believes it has not been taxed in line with the relevant double tax treaty; and (vi) whether there are any pending appeals. Any documentation which could be relevant for the MAP should be attached (e.g., tax assessments or tax audit reports).
An MAP is only initiated if no unilateral relief is possible and if the material prerequisites for implementation are given. These prerequisites are: (i) the case falls within the scope of the specific double tax treaty; (ii) the taxpayer was not taxed or may possibly not be taxed in line with the double tax treaty; (iii) the relevant period for presentation of the case has not yet lapsed; and (iv) the taxpayer's legal point of view is reasonable. The Austrian Ministry of Finance views the initiation of an MAP as being in its sole discretion.
Further, the decree contains information on how an agreement reached by the competent authorities of the two treaty states shall be implemented procedurally.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.