Gst Rate for Legal Fees

It is further clarified that Communication No 13/2017 – Central tax (rate) of 28.6.2017 (reference number No 2) specifies, inter alia, the following service in the reverse charge procedure as follows: `services provided directly or indirectly by an individual lawyer, including an experienced lawyer, by way of representation before a court, a jurisdiction or authority, to an economic entity established in the tax jurisdiction; even if the contract for the provision of such a service was concluded by another lawyer or law firm or by way of legal services for an economic entity`. While legal services are usually subject to GST/HST, this may not be the case for expenses. If a payment is made as an agent for the client, the lawyer simply passes on the gross amount to the client without adding GST/HST and does not claim ICT for any tax paid to the third-party payment provider. On the other hand, if a payment is an input for legal services, the law firm would claim ITCs on any tax paid upon acquiring the payment, include the net amount of tax in its legal services fees, and apply the applicable tax rate (see above) to the total consideration. After the implementation of the GST Act, the taxation of legal services will not change. It does not apply to reverse charge or term fees for lawyers and law firms. (9) Exempt legal services provided by a legal aid plan practitioner to clients may be provided in two ways: A person needs legal services. The person applies for legal aid from a legal aid plan administrator who provides legal services to the client under a legal aid plan administered under the supervision of a provincial government. The administrator of the legal aid plan gives the person a voucher indicating that the administrator of the legal aid plan pays for the services of a lawyer. The person then uses the voucher to receive legal services from a lawyer in private practice. As a result of the implementation of the GST Act, the taxation of legal services will not change. It also does not apply to reverse charge or future encumbrance for lawyers and law firms. Don`t worry and talk to the best tax and human rights lawyers with MyAdvo! With over 10,000 lawyers in its network in 60+ cities, MyAdvo is India`s leading legal solutions and support platform.

IndiaFilings.com is committed to helping entrepreneurs and small business owners start, manage and grow their businesses at an affordable price. Our goal is to educate the entrepreneur on legal and regulatory requirements and to be a partner throughout the business lifecycle, supporting the business every step of the way to ensure it is compliant and continuously growing. (i) Advance for the continued provision of legal services Conclusion: It is also clarified that communication No. 13/2017 – The central tax (payment) of 28.6.2017 (reference number 2) provides, inter alia, for the following services in the context of the reverse charge procedure, as follows: `the services of an individual lawyer, including a lead lawyer, representing a court or public authority, directly or indirectly for an economic entity established in the tax territory, even if the contract for the provision of such a service is concluded by another lawyer or law firm, or by the provision of legal services to a commercial entity ». The above provisions make it clear that if legal services are provided by a single lawyer (including senior counsel) or law firm for a commercial entity, in this case under the reverse charge mechanism, GST must be paid by the business entity for that transaction. Finally, the applicability of the GST to legal services can be summarized as follows: there should be two categories of lawyers, namely senior lawyers and other lawyers. A lawyer may be appointed as lead counsel with his or her consent if the Supreme Court or a Supreme Court considers that he or she deserves such an award on the basis of his or her expertise within the Bar Association or his or her particular knowledge or experience in the field of law. (3) Senior lawyers shall be subject to such restrictions as the Bar Council of India may impose in the interest of the Bar Association in the course of their practice. 4. An advocate of the Supreme Court who was senior counsel of that court immediately before the date fixed shall be deemed to be senior counsel for the purposes of this Division. The definition of legal services has been given in entry 2 (zm) of the notification number. 12/2017 – Central tax rate of 28.06.2017, reproduced below: There is an exemption from GST payment on attorneys` and office fees.

Only if they provide their services to a person and not to a commercial entity. 2. In the past, service providers and recipients did not have to pay taxes. But if you were to use the same services of someone who is not a practicing lawyer, it was taxable. Now, however, there is GST on lawyers` fees or law firm fees, but they do not have to pay GST. Therefore, if a lawyer practices in a law firm or represents himself or herself individually, he or she must first register for GST. Currently, the registration of lawyers for GST is not mandatory. In addition, you do not have to pay business tax, as all taxes are a combination of one. GST is subject to a fee if a lawyer or law firm provides any type of legal services to a business with total sales of Rs 20 lakhs or more in the previous fiscal year. GST for legal services is also subject to a fee if a senior lawyer provides legal services to another lawyer or law firm.

GST registration is required when a lawyer, senior lawyer or law firm provides legal services (exempt and taxable services) and meets one or both of the following conditions: 1 If you do not intend to charge GST for legal services, you will generally need documents from the recipient to support the exemption (e.g., to determine: that they are in fact non-residents, members of an Indian band, etc.) in the event of an audit. However, you need to check the registration of a law firm that provides legal services outside of India. Apart from that, you should also check the receipt of the equivalent of foreign currency in India. Clarifying F. No. 354/107/2017-The government clarified that legal services, including representation services, provided by a lawyer, including lead counsel for a business entity are taxable under RCM, i.e. The company must pay taxes according to RCM. In accordance with Communication No. 13/2017 – Central tax (rate) of 28 June 2017, RCM applies to legal services provided to the business entity. If the services are provided outside India, RCM is not applicable as the business entity is located outside the tax jurisdiction. Legal services are services provided by lawyers and lawyers in connection with advice, advice or assistance in a branch of law or representation services before a court.

Legal services receive special treatment under the GST.