GST on Legal Services: Advocates, Law Firms & Companies
GST on Legal Services: Understanding the Tax Treatment of Advocates, Law Firms and Legal Companies Businesses often assume that every professional service attracts GST in the same manner. However, legal services operate under a unique framework where the liability to pay GST may shift from the service provider to the recipient under the Reverse Charge Mechanism (RCM). In practice, this is one of the most frequently misunderstood areas during GST audits and internal compliance reviews. Many companies fail to discharge GST under RCM on legal fees, while some advocates unnecessarily obtain GST registration and charge GST on invoices despite the law providing otherwise. This article examines the GST implications on legal services provided by individual advocates, senior advocates, firms of advocates and legal consultancy companies. Legal Services Under GST – What Does the Law Cover? The term "legal service" has been defined under Notification No. 12/2017-Central Tax ...