Regulatory developments 2017

Services rendered by lawyers and solicitors in the framework of Act 1/1996 of 10 January governing free legal aid are not subject to VAT.

On June 22, Law 2/2017, of June 21, amending Law 1/1996, of January 10, on free legal assistance, was published in the Official State Gazette, modifying, with effect from January 1, 2017, the aforementioned Law 1/1996, with the purpose, as stated in its explanatory statement, " to increase the guarantees that our legal system offers in terms of free justice, both for citizens and professionals, this reform aims to strengthen the public service nature of this provision activity, reinforcing it and guaranteeing that it is duly subsidized by the public authorities and recognizing the payment of the corresponding compensation in favor of the professionals obliged to provide it. ”.

In this way, the new regulation of the free legal service is based on two basic principles: its binding force for professionals, lawyers and solicitors, who must carry out the provision to meet the mandate in article 119 of the Spanish Constitution, and this provision will be carried out free of charge by the aforementioned professionals.

The General Directorate of Taxes in its response to the binding consultation of June 30, 2017, number V1706-17, which is already published on the website of the Ministry of Finance and Public Administration, has established that from January 1, 2017, effective date of the new regulation of the free legal aid system, the services provided by lawyers and solicitors within the framework of Law 1/1996, of January 10, on free legal aid, will not be subject to Value Added Tax.