Sector summary ― solicitors

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note provides a summary of key VAT issues of relevance to solicitors.

Areas covered include:

•
an introduction to the sector and core services of solicitors
•
disbursements
•
commission
•
other kinds of income
•
place of supply of a solicitor’s services
•
identifying the recipient of a supply of legal services
•
time of supply and invoicing
•
key case law for solicitors

Introduction to the sector

Solicitors can deal with many types of legal matters including:

•
litigation
•
conveyancing
•
trusts and other execution services
•
general legal and tax advice

Most legal services supplied by solicitors in the UK are taxable at the standard rate.

Despite this apparent simplicity there can be various areas of difficulty for solicitors which include:

•
the VAT implications of disbursements
•
commissions and other income streams attracting non-standard VAT liability
•
identifying the place of supply of services
•
identifying the recipient of a supply of services

Disbursements

Overview

Solicitors often recharge costs to their clients or make what

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