A lawyer who volunteers his time may well be liable for taxes

A lawyer had provided services to various organizations and had reported these services as in-kind donations in order to claim a tax credit. At the same time, she had not reported the amounts declared as donations for tax purposes.

Following a tax audit,administration sent a reassessment proposal the attorney, arguing instead that these amounts were taxable.

In principle, a self-employed attorney is taxed only on the amounts he or she has actually received. Thus, the attorney, who had never received any compensation for the services she had provided, believed that those services were not taxable.

The Administrative Court of Appeal noted, however, that the associations’ records mentioned“payments”made by the attorney. These records“specify the number of hours worked and an hourly rate of 300 euros, excluding tax.” The court therefore concluded that the services provided by the attorney were performed for compensation and not pro bono.

The Court will also rule that the lawyer’s waiver of her fees would demonstrate that she had access to the funds even though she did not actually receive them. According to the Court, the lawyer could not claim to have waived her earnings.

The Administrative Court of Appeals upheld the increase but also the application of penalties for willful misconduct, a decision that appears particularly harsh given the existing ambiguities in the relevant statutes, as we had noted following the Administrative Court’s ruling.

CAA Paris, July 17, 2025, No. 24PA00433

This legal watch provided by Mispelon Avocat, a law firm specializing in French tax audit and French tax litigation. You can stay legal watch subscribing to the newsletter via this link.