Is a self-employed associate lawyer truly a new type of business?

A Polynesian lawyer had entered into a freelance contract with a law firm. He believed he was eligible for a tax exemption provided for in the Polynesian Tax Code, which stipulated that "new businesses are exempt from transaction tax for their first three fiscal years […]. New businesses are defined as those that create a truly new activity."

Following a tax audit of the attorney,administration this exemption. They argued that the professional partnership did not constitute a genuinely new business activity.

The Administrative Court of Appeal, for its part, held that the collaboration agreement provided that the attorneywould"handle cases referred by the company and, in return, receive a 50% share of the fees in addition to a fixed salary, access to the law firm’s human and material resources, and reimbursement of his professional expenses."

The Court also notes that while the associate is permitted to develop his own client base, in 2022 he handled 38 cases for the firm, 4 for his own clients, and 6 under legal aid.

It held that the lawyer’s practice is therefore carried out within the framework of the law firm with which he entered into his collaboration agreement. His practice was therefore not truly new, and, according to the Court, he was not eligible for the exemption.

The Court upholds the tax assessment against the attorney.

It would be interesting to see whether the Conseil d'Etat the same conclusion, especially since, according to the Court, the lawyer had indeed built up a personal client base, which suggests that his practice as a lawyer was not limited to the firm’s cases.

CAA Paris, Dec. 10, 2025, No. 25PA00912

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