New GST on Advocates and Legal Services
Legal services are essential for individuals and businesses alike. But are they taxable under GST ? The answer depends on who is providing the service and who is receiving it. This guide breaks down the gst on advocates, its applicability, and how lawyers and clients should manage it.
Are Legal Services Taxable Under GST?
Yes, but with important exemptions.
As per GST rules, individual advocates and law firms are covered under GST, but the responsibility to pay tax lies with the recipient of the service, not the advocate. This is done through a mechanism called Reverse Charge.
New GST Rate on Lawyer Services in India
The Government of India is updating GST rates effective after 22 Sep 2025. Below are the expected new GST rates for lawyer services (no compensation cess).
New GST on Lawyers: Key Points
| Service Provider | Recipient | GST Applicable? | Who Pays GST? |
|---|---|---|---|
| Individual Advocate | Individual (non-business) | ❌ No | – |
| Individual Advocate | Business Entity (Registered under GST) | ✅ Yes (RCM) | Client |
| Law Firm | Registered Business | ✅ Yes (RCM) | Client |
| Advocate/Law Firm | Government or Court | ❌ No (Exempt) | – |
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Old GST on Lawyers: Key Points
(Old GST Rates – Applicable Until 21st September)
| Service Provider | Recipient | GST Applicable? | Who Pays GST? |
|---|---|---|---|
| Individual Advocate | Individual (non-business) | ❌ No | – |
| Individual Advocate | Business Entity (Registered under GST) | ✅ Yes (RCM) | Client |
| Law Firm | Registered Business | ✅ Yes (RCM) | Client |
| Advocate/Law Firm | Government or Court | ❌ No (Exempt) | – |
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Old GST on Lawyers Fees in India
The gst on lawyers fees in india is:
- 18% GST if the client is a registered business
- 0% GST if the client is an individual (non-business)
This tax is not collected by the lawyer. Instead:
- The client (business) pays 18% GST under RCM
- The lawyer does not charge GST on the invoice
- The client must self-invoice and pay GST to the government
Are Advocates Required to Register Under GST?
| Advocate Type | GST Registration Required? |
|---|---|
| Individual Advocate | No (if only legal services) |
| Law Firm | No (if only legal services) |
| Advocates with other taxable income | Yes |
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Input Tax Credit (ITC) on Legal Fees
If you are a business client:
- You can claim Input Tax Credit on GST paid under Reverse Charge for legal services
- You must record this in GSTR-3B as both liability and ITC
Conclusion
Understanding the gst on advocates helps both legal professionals and their clients stay compliant. While most advocates are exempt from registration, businesses must handle GST payments under RCM properly.
Hi there! I’m a Chartered Accountant with over 20 years of experience in financial accounting and a passion for writing. I enjoy simplifying complex topics like GST and income tax, believing that learning should be a lifelong journey. I'm here to share insights and make financial matters easier for everyone!
Frequently Asked Questions
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Is GST applicable on services provided by advocates?Yes, but under Reverse Charge Mechanism. The client must pay GST, not the lawyer.
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What is the GST on lawyers fees in India?It is 18%, applicable only when the client is a registered business.
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Do lawyers need to register under GST?No, if they only provide legal services and receive payments under RCM.
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Can a business claim ITC on legal fees?Yes. Businesses can claim Input Tax Credit (ITC) on GST paid under Reverse Charge.
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Are government legal services taxed under GST?No. Services to courts, tribunals, or government bodies are exempt from GST.