.webp)
Read
By clicking on”Accept all cookies“, you agree that cookies may be stored on your device in order to improve site navigation, analyze site usage, and help us with our marketing efforts. See our privacy policy for more information.
.webp)
You have just taken the oath, you do not know if you need to have an accountant, you are neither a URSSAF specialist, nor a VAT specialist and you are wondering if you can benefit from the VAT exemption for lawyers: the answers to your questions are here!
As a lawyer, you supply services that make you a “taxable person” for VAT purposes.
This means that, in principle, you must charge VAT on the services you invoice to your clients (subject to the applicable place-of-supply rules). Conversely, you may deduct the VAT you incur on the expenses of your practice.
A simple example to illustrate the basic VAT mechanism:
When you invoice a French private client €1,000 excluding VAT for a consultation, you apply VAT at 20% on that amount, i.e. €200. Your client pays €1,200 including VAT, and you must then remit that “output” VAT to the tax authorities.
At the same time, if you buy your barrister's robe for €800 excluding VAT, you also pay 20% VAT on that price, i.e. €160. That VAT is “deductible”.
When you prepare your VAT return, the deductible VAT is set off against the VAT collected, so you pay 200 − 160 = €40 to the Treasury.
With the small-turnover exemption… forget all that!
The exemption applies as of right as long as your fees remain below the applicable ceilings: there is nothing to apply for. What is a matter of choice is giving it up, by opting to pay VAT. In practice, under this regime you:
Taking the same example, under the exemption you invoice your client €1,000 with no VAT, and you buy your robe for €960 including VAT without being able to deduct the VAT you have incurred.
You have grasped the principle, but you are still unsure whether the exemption is in your interest?
Then let's get to the heart of the matter.
The first advantage is a reporting one. Under this regime, you do not need to file VAT returns.
In practice, filing a VAT return can be handled by your accountant (if you have one) or by yourself (in which case you will need to keep at least basic accounts and make sure the return is filed on time, failing which penalties apply).
Under the exemption, there is no need to keep your receipts and no return to file.
For anyone with an aversion to paperwork, that argument may be enough on its own.
Keeping the exemption is in your interest if you invoice mainly or exclusively private clients, since they cannot recover the VAT on your consultations — unlike business clients.
Charging VAT to private clients means increasing the cost of your services for them. Under the exemption, you can either:
The exemption therefore makes you more competitive than colleagues who must charge VAT.
For a newly qualified lawyer expecting a substantial private client base (criminal law, family law, and so on), it can be a real competitive advantage — one worth analysing closely.
The main drawback of the exemption is that you cannot deduct the VAT you bear on the costs of your practice.
You will therefore not be able to deduct VAT on your running costs (robe, office equipment, commercial lease where applicable, business meals, and so on).
You should therefore assess the costs you expect to incur in order to measure the financial impact of the exemption.
The exemption is of little value if you invoice only business clients who are taxable persons and can deduct the VAT you charge them.
In practice, if you sign a collaboration agreement and do not expect to build a personal client base of individuals, the exemption is of no interest to you.
To qualify for the exemption, you must stay below certain turnover ceilings (see below). If you exceed them, you lose the exemption in one of two ways: on 1 January of the following year where the ceiling assessed on the previous calendar year is exceeded; and on the very date of the excess where you cross the ceiling for the current year. Since 1 January 2025, both the first-day-of-the-month rule and the former tolerance period have been abolished.
If you benefit from the exemption, you must therefore monitor your turnover monthly to make sure you stay below the ceilings. A blow for anyone who assumed the exemption meant never having to think about VAT again — the opposite is true.
In short: the exemption should mainly be considered by lawyers who invoice private clients.
A modest level of retrocession fees does not, in itself, mean the exemption is in your interest. If you are an associate receiving €4,000 in retrocession fees, keeping the exemption prevents you from deducting the VAT borne on your costs — which can amount to a significant sum over a year.
Do not keep the exemption for the wrong reasons. Ask yourself the right questions:
In practice, if you sign a collaboration agreement or do not expect a private client base, opting to pay VAT should be preferred from the outset: it allows you to deduct the VAT borne on your costs.
The reporting burden is lighter than it is often assumed to be. Today, you may file quarterly returns as long as the VAT due for the year remains below €4,000. And from 1 January 2027, article 38 of the Finance Act for 2025 abolishes the simplified assessment regime: quarterly filing becomes the default for turnover below €1,000,000, monthly filing being mandatory only above that figure — or available by election, which is worth considering if you are structurally in a VAT credit position.
If you want to go further, the ceilings you must observe to qualify for the exemption are set out below.
To qualify, you must not exceed certain turnover ceilings, both for your “regulated” activity and for your “unregulated” activities.
Exceeding the ceiling assessed on the previous calendar year causes you to lose the exemption on 1 January of the following year. Exceeding the ceiling for the current year takes effect on the very date it occurs. The general ceilings (€37,500 for services, €85,000 for supplies of goods) do not apply to you.
Lawyers do not fall under the general ceilings. Article 293 B, I bis of the FTC provides them with their own ceilings, assessed separately according to the nature of the fees.
The regulated activity — referred to as “core practice” — covers the services falling within the activity defined by the rules governing the profession. Ancillary activities, listed in the administrative guidance at BOI-TVA-DECLA-40-20, are subject to separate ceilings (see below).
To qualify for the exemption, your turnover from your regulated activity must not have exceeded €50,000 excluding VAT in the previous calendar year. That ceiling has stood at €50,000 since 1 January 2025; it was previously €47,700.
It results from article 82 of the Finance Act for 2024 and was confirmed by Law no. 2025-1044 of 3 November 2025, which definitively set aside the single €25,000 threshold enacted in February 2025 — a threshold that never came into force. Two practical consequences: these amounts are no longer revalued every three years, and only fees earned in France are taken into account.
The fees to be taken into account are those actually received, including taxable retrocession fees, unless you have elected to keep your accounts under commercial accounting rules.
Watch out when you start practising: it is the ceiling itself that is adjusted, in proportion to the number of days of activity out of 365. If you are sworn in on 1 October, your adjusted ceiling is not €50,000 but €50,000 × 92/365, i.e. around €12,600. Receiving €22,500 in the final quarter therefore takes you out of the exemption on 1 January of the following year.
This second ceiling, set at €55,000 excluding VAT since 1 January 2025 (€58,600 previously), applies per calendar year and is never prorated.
Crossing it makes your transactions taxable from the date of the excess, and not from the first day of that month.
Any invoices issued without VAT from that date must be corrected (where you were required to issue them) and subjected to VAT. Be careful: failing to correct invoices issued without VAT once the ceiling has been exceeded is a classic source of reassessment on a tax audit.
You should therefore monitor your activity closely, so as to anticipate the excess and charge VAT from the day it occurs.
As soon as you find that the ceiling has been exceeded, you should inform your tax office so that your online account is updated and you begin filing VAT returns.
By “unregulated activities”, the tax authorities mean the following:
These fees are subject to their own ceilings: €35,000 excluding VAT for the previous calendar year and €38,500 excluding VAT for the current year. Fees of an exceptional nature, such as the proceeds of a disposal of fixed assets, are left out of account.
The two exemptions are not watertight, however: the regime ceases to apply from the date on which either ceiling is reached. Crossing €55,000 of fees from your regulated activity therefore also costs you the exemption on your ancillary activities.
Let's take Vincent and Randa, who may well be in your position.
Vincent is sworn in on 1 November and has ticked the “franchise de base” box on his registration form. What does that mean in practice?
Vincent is an associate in a firm paying him retrocession fees of €5,000 per month, so he will receive €10,000 between November and December. He is far below the €55,000 ceiling for the current year: there is no risk of losing the exemption this year.
His ceiling for the previous year, however, is adjusted to his 61 days of activity, i.e. €50,000 × 61/365, around €8,350. His €10,000 exceeds it.
Vincent will therefore lose the exemption on 1 January of the following year. He will need to contact his tax office in order to move to the standard regime as from 1 January.
Randa, for her part, was sworn in on 1 January. She applied the exemption from her first day of practice and received fees totalling €22,000 over the year. She is comfortably below the €50,000 ceiling for her first year and can continue to benefit from the exemption the following year.
By 1 November of that second year, however, Randa has already received €52,000. She will cross the €55,000 ceiling for the current year during December, and should contact her tax office now in order to move to the standard regime.
She must also make sure to charge VAT from the day of the excess, and not from the first day of the following month: the exemption ceases to apply to transactions carried out from that date.
Today, your invoices must carry the wording “TVA non applicable, article 293 B du CGI”. That reference remains valid until 30 June 2028.
Ordinance no. 2025-1247 of 17 December 2025 transfers the French VAT rules from the FTC to the Code of Taxes on Goods and Services (Code des impositions sur les biens et services, “CIBS”). That move, initially set for 1 September 2026, has been postponed to 1 January 2027. It is a recodification without any change to the substance: neither the ceilings, nor the conditions of the exemption, nor its consequences are altered.
From 1 January 2027, the regime will be found in articles L. 233-1 et seq. of the CIBS, under the new concept of an “exempt small business” (entreprise franchisée) — the counterpart of article 293 B being article L. 233-3, and the ceilings applicable to lawyers article L. 233-10. The exact wording to be shown on invoices will be confirmed by administrative guidance; we will update this page accordingly.
Are you a lawyer with VAT questions, for yourself or for your clients? Do get in touch.
%20(1).webp)
Partner
%20(1).webp)
Partner
Discover the latest news on indirect taxation and the firm.
.webp)
.webp)