The limits to MAP are highlighted by HMRC in the International Manual:

‘It is very important to realise that the mutual agreement procedure does not guarantee the elimination of double taxation. The treaty says that the competent authorities will ‘endeavour’ to do so. In the vast majority of cases this is achieved but there is no guarantee. It is perfectly possible that each competent authority will believe (and have very good reasons for believing) that the arm’s length price is different and this will result in unrelieved double taxation. This can happen only in extremis.’

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