News and Insights

Taxation of Legal Services in British Columbia

Tax Development Nov 06, 2012

As part of a series of notices regarding the re-implementation of Provincial Sales Tax (PST) in British Columbia on April 1, 2013, the province released Notice 2012-014, “Legal Services”, which gives an overview of the application of PST to legal services. The notice provides examples of circumstances where legal services will be subject to PST, both for legal services provided in the province, and for services provided outside of British Columbia.

For purposes of the application of PST, legal services are defined to include most services provided by lawyers and notaries, in their capacity as barristers, solicitors and notaries, except where such services are performed by employees as part of their employment duties to their employer. Under the provisions of the Legal Profession Act and the Notaries Act, only lawyers and notaries may perform legal services.  

Where legal services are provided to a purchaser or recipient who ordinarily resides, or carries on business in British Columbia, the purchaser is required to pay tax on all purchases of legal services provided in British Columbia.  If the legal services are provided outside of British Columbia, tax is payable on the purchase price of legal services that relate to British Columbia.   

The purchase price of legal services includes all fees, charges and disbursements for legal research and other support services.  However, charges for the transmission, printing or copying of documents billed to a client on a reasonable cost-recovery basis are excluded from the purchase price.  

BC Notice 2012-014