Tax

Do I need to charge VAT on services provided by my firm?

I’m setting up a new firm. Will I be required to charge VAT on the provision of my services?

Not necessarily. Value added tax (VAT) will be chargeable if:

  • the firm is registered for VAT purposes, and
  • the supply of the particular legal services to the client is subject to VAT and not exempt from VAT or zero-rated

You must register when your turnover exceeds the registration threshold.

However, you may choose to register before reaching the threshold.

In addition to charging VAT on your supply of legal services, when accounting to HM Revenue and Customs (HMRC), you can offset any VAT you pay (input tax) on your firm's expenditure against the VAT you charge.

For information on the requirements to register, see HMRC's guidance on VAT registration.

Disclaimer

While every effort has been made to ensure the accuracy of the information in this article, it does not constitute legal advice and cannot be relied upon as such. The Law Society does not accept any responsibility for liabilities arising as a result of reliance upon the information given.

Have you got a practice question?

Call the Practice Advice Service on 020 7320 5675 or email practiceadvice@lawsociety.org.uk.

The Practice Advice Service is staffed Monday to Friday from 9am to 5pm.

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