If you want to start a law firm in India but don't know how, don't worry, because we will discuss how one can start a legal consultant services in this blog. Read on to know!
Small start-up practices are becoming more popular, and lawyers all over the country are opening their own law firms because they are drawn to the advantages of working for themselves and having the chance to directly benefit from their own labor, as opposed to meeting demand targets and lining the pockets of other business owners.
All of this seems very appealing, but starting and maintaining a successful law firm is no simple task. By offering assistance and support, we at Vakilsearch are skilled in helping law firms achieve their goals.
You can avoid problems and determine the best course of action quickly by using all the experience and knowledge you can at the start and throughout your business journey.
Our team of consultants consists of experienced chairmen, board members, and law firm owners. Their experience is beneficial for all aspects of quickly and effectively establishing a firm.
In this blog, we will discuss how one can start a legal consultant services in india.
Eligibility Requirements for Starting a Law Firm in India
- An individual needs to be 21 years old.
- The individual must possess a law degree from a university that is recognised by the Bar Council of India, and;
- Individuals should be registered with any state Bar Council of India.
Things to Consider before Establishing a Law Firm in India
- The number of lawyers you want to work with, their roles, and their areas of specialization.
- For the law practice to cover startup costs and last through the first few months of business, financing will need to be secured through loans or savings.
- As the proprietor, you may consider thinking about registering the company’s trademark to safeguard the name.
- If the lawyers in a law firm have previously been approved by the Bar Council of India, registration is not necessary. However, certain regulations will have to be followed by the company, depending on the profits.
- It takes a maximum of Rs. 2 lakhs to launch a proper legal firm from home, while the exact amount may vary based on the partners, tasks, location, etc
Procedures for Registration of Law Firms in India
Prior to starting the process of forming a law firm, it’s critical to choose the structure and registration that will work best for you and your situation.
All of the members of a law firm must be registered with the State Bar Council as practicing lawyers before it can be registered.
In India, there are primarily 3 types of legal structures:
Sole Proprietorship
It is the most basic form of the business structure. Since the business is run by a single person, limited liability protections do not apply in the event that the loan amount is recovered.
If you want to start a sole proprietorship law firm, You must register a bank account under that name and secure the necessary licenses before you can start your firm. For this, you will need,
- Service tax registration,
- letter from CA describing the nature of the business
- Letterhead with firm’s name and address,
- Stamp in the name of the proprietor,
- Address & ID proof of the proprietor and office premise address proof If the proprietorship address is different.
Partnership
This kind of firm can be registered either at the time of formation or even after. In order to register, you must submit an application to the firm’s area registrar of businesses.
This will consist of
- Firm Name,
- Place Name where the firm is situated,
- Date of partners joining the firm,
- Full name & permanent address of partners,
- Duration of the firm.
- Application for Registration in prescribed Form – I,
- Duly filled Specimen of Affidavit,
- Certified copy of Partnership deed,
- The lease or rental agreement must be presented as proof of ownership.
The Certificate of Registration of the Law Firm will be provided by the Registrar if all of these requirements have been fulfilled.
Limited Liability Partnership (LLP)
In an LLP, each member is only responsible for their share of the debt. They must fill out applications for DPINs (Designated Partner Identification Numbers) and then for digital signature certificates.
A distinctive name must be used when submitting an application to the Ministry of Corporate Affairs for the establishment of the business.
A certificate is obtained once this procedure is finished. After that, the Ministry of Corporate Affairs must authorize the name of the LLP. A registered Permanent Account Number (PAN) and Tax Account Number are required for each LLP (TAN).
For more information you can contact Vakilsearch, their team will solve all your doubts.
Tax rate
A legal consultant services is subject to the same tax rates as any other consultancy.
| Tax | Rate of Tax |
| Service Tax | 10% of the value of services |
| Education Cess | 2% of the service tax payable |
| Secondary and Higher Education cess | 1% of the service tax payable. |
| Other – Penalty/interest | As levied or applicable |
Any consulting, guidance or technical assistance offered in any area of law is suggested to be subject to service tax, just like in the cases of management consultancy or engineering consultancy services.
The tax would only apply to services provided by one business entity to another. A business entity, according to the definition, is anything other than an individual, including firms, associates, enterprises, companies, etc.
Therefore, services rendered by a sole advocate to a person or even a business entity would fall outside the purview of the taxable service.
A corporate legal firm’s services rendered to an individual would also fall outside the definition of a taxable service. This levy would also not apply to any service of appearance before a court of law or other statutory authority.
Conclusion
Even though it is not required, registering a legal consultant services gives it and its partners some privileges that an unregistered firm does not.
When selecting the legal form of a firm, there are important considerations that must be made because each structure has a different registration process.
Even the most experienced lawyers find it difficult to sustain and grow a successful law firm in today’s cutthroat business environment. Vakilsearch legal professionals can guide you step-by-step through the entire procedure whether you’re trying to establish your own practice or grow your existing one.
Also, Read:
- Risks of Starting Own Business
- Making a Business Plan
- Procedure to Obtain License for Food Transport Company
