GST ON IMPORT OF LEGAL SERIVCES

RCM 177 views 1 replies
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Chief Accountant
110 Points Joined August 2014

Dear Experts,

My client is law firm.

Law firm is importing legal services from various countries for trademark registeration and other legal services on behalf of its client.

The Foreign Advocates raise bill in the name of law firm and law firm making payment on behalf of the clients.

My query is whether RCM is applicable to law and GSt is payable under RCM by law firm.

(Please also answer Pvt ltd company instead of law firm whether provision will be same)

Please do the needful.

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On 30 January 2025 at 20:07 Report
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Master in Accounts & high court Advocate
9142 Points Joined December 2011

To determine if Reverse Charge Mechanism (RCM) is applicable to your law firm's import of legal services, let's break down the key points: - *Import of Legal Services*: Your law firm is importing legal services from foreign advocates for trademark registration and other legal services on behalf of clients. - *Billing and Payment*: Foreign advocates raise bills in the law firm's name, and the law firm makes payments on behalf of clients. According to GST regulations, *legal services* are subject to RCM if provided by an individual advocate, including a senior advocate, or a firm of advocates to a *business entity*.¹ In this case: - *Law Firm as a Business Entity*: As a law firm, you are considered a business entity. - *RCM Applicability*: Since the foreign advocates are providing legal services to your law firm (a business entity), RCM is applicable. Under RCM, the *recipient (your law firm)* is liable to discharge GST liability @ 18%. This means your law firm will need to pay GST on the imported legal services. Now, regarding the provision for a Pvt Ltd company instead of a law firm: - *Same Provision Applies*: Yes, the provision remains the same. If a Pvt Ltd company imports legal services from foreign advocates, RCM will be applicable, and the company will need to pay GST under RCM.

In summary: - RCM is applicable to your law firm's import of legal services. - Your law firm, as the recipient, is liable to discharge GST liability @ 18% under RCM. - The same provision applies to a Pvt Ltd company importing legal services from foreign advocates.

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On 31 January 2025 at 05:47


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