BIR Form 2307 for Lawyers and Solo Law Practitioners: Professional Fee Withholding Rates

A client that engages an individual, solo-practicing lawyer directly — not through a law firm — withholds tax on her professional fee at 5% or 10%, the same individual professional-fee bracket used for any other licensed professional, under Revenue Regulations (RR) No. 11-2018. This is a materially different withholding path from paying a law firm organized as a general professional partnership (GPP) or as an ordinary corporation, and confusing the three is one of the more common BIR Form 2307 errors on legal fees.

This guide is part of the BIR Form 2307 series. It covers the rate and ATC codes that apply when a client pays a solo lawyer directly, how that contrasts with paying a law firm structured as a GPP or as a corporation, and a worked example for a ₱200,000 legal engagement fee.

Is a solo lawyer subject to the same withholding bracket as other professionals? #

Yes. Lawyers are explicitly named among the licensed professions covered by the individual professional-fee withholding bracket under RR No. 11-2018, alongside CPAs, doctors, architects, and engineers. There is no separate, lawyer-specific rate — a solo practitioner paid directly by a client is withheld exactly the way any other individual professional is.

“The following individuals shall be subject to the professional fee withholding tax bracket under Section 2.57.2(A): lawyers, certified public accountants, doctors of medicine, architects, engineers, and other recognized professions…”

— Section 2.57.2(A) of Revenue Regulations No. 2-98, as amended by RR No. 11-2018, as reproduced across BIR compliance summaries of the enumerated professional-fee bracket.

This matters because it settles a question readers often ask by analogy to doctors or accountants: a lawyer in solo practice, retained and paid directly by a client, does not fall into some separate legal-fees category. She is an individual professional payee, full stop, and the client is a withholding agent obligated to deduct EWT and issue BIR Form 2307.

What rate and ATC code apply to a solo lawyer’s fee? #

A solo lawyer paid directly is withheld at 5% (ATC WI010) or 10% (ATC WI011), depending on her gross income for the year and whether a sworn declaration is on file — identical to the individual-payee rules covered in BIR Form 2307 for Professional Fees.

The lower 5% rate depends on the lawyer submitting an Income Payee’s Sworn Declaration of Gross Receipts/Sales, together with a copy of her BIR Certificate of Registration (BIR Form 2303), to the client. Without that declaration on file, the client should default to withholding at 10% rather than assume the lower rate.

How does this differ from paying a law firm organized as a GPP? #

When the client instead engages a law firm structured as a general professional partnership (GPP), the client withholds nothing at all on the payment to the firm. Under NIRC Section 26 and Revenue Memorandum Circular (RMC) No. 3-2012, income payments to a GPP for professional services are not subject to income tax and consequently not subject to withholding tax. The client pays the GPP’s full billed fee with no ATC code and no BIR Form 2307 to prepare on that invoice.

Withholding on a GPP’s legal fees shifts to a different point entirely — when the GPP later distributes income to its own individual partners, using dedicated ATC codes (WI152 at 10%, WI153 at 15%) rather than the WI010/WI011 codes used for a solo practitioner. See Withholding Tax on GPP Professional Fees for the full mechanics of that distinction, including a worked example of a two-partner law office.

How does this differ from paying a law firm organized as a corporation? #

When a law firm is organized as an ordinary corporation rather than a GPP, the client withholds under the corporate professional-fee bracket instead of either the individual or the GPP-exempt treatment — ATC WC010 at 10% if the firm’s gross income for the year does not exceed ₱720,000, or WC011 at 15% if it exceeds that threshold, following the same corporate rate structure covered in BIR Form 2307 for Professional Fees.

The three scenarios a client can face when engaging legal services therefore diverge sharply, even though the underlying service — legal representation or advice — looks identical from the client’s side:

Getting this wrong in either direction creates a compliance problem: withholding on a GPP’s invoice overstates the client’s remittance and under-pays the firm, while failing to withhold on a solo lawyer’s or corporate firm’s fee understates the client’s expanded withholding tax liability.

Worked example: engaging a solo practitioner directly #

Suppose a company engages Atty. Cruz, a solo-practicing lawyer, directly for a legal engagement fee of ₱200,000. She has submitted a sworn declaration confirming her gross income for the year has not exceeded ₱3,000,000 — her cumulative gross income to date is ₱1,800,000 — and that she is non-VAT registered, so ATC WI010 at 5% applies.

The company pays Atty. Cruz ₱190,000, remits the ₱10,000 withheld through BIR Form 0619-E monthly and BIR Form 1601-EQ quarterly, and issues her a BIR Form 2307 showing ₱200,000 as the income payment, ATC WI010, and ₱10,000 as tax withheld. Atty. Cruz then credits the ₱10,000 against her income tax due when filing BIR Form 1701.

If her gross income had already crossed ₱3,000,000, or if no sworn declaration were on file with the company, ATC WI011 at 10% would apply instead — ₱20,000 withheld on the same ₱200,000 fee, leaving Atty. Cruz a net of ₱180,000 rather than ₱190,000. The gross fee and the service rendered are unchanged; only her income-level and documentation status determine which of the two rates applies.

Frequently asked questions #

What withholding tax rate applies when a client pays a solo lawyer directly? #

A solo-practicing lawyer engaged and paid directly by a client is an individual professional payee under RR No. 11-2018. The rate is 5% (ATC WI010) if her gross income for the current year does not exceed ₱3,000,000 and a sworn declaration is on file, or 10% (ATC WI011) if it exceeds ₱3,000,000, she is VAT-registered, or no valid declaration has been submitted.

Does the withholding rate change if the client engages a law firm instead of an individual lawyer? #

Yes, and it depends on how the firm is organized. If the firm is a general professional partnership (GPP), the client withholds nothing at all on the payment to the firm under RMC No. 3-2012 — withholding only applies later, when the GPP distributes income to its own partners (ATC WI152/WI153). If the firm is organized as an ordinary corporation rather than a GPP, the client withholds under the corporate professional-fee bracket (ATC WC010/WC011, 10%/15%) instead of the individual bracket.

Which ATC codes apply to a solo lawyer’s professional fee versus a law firm’s? #

A solo lawyer paid directly uses ATC WI010 at 5% (gross income up to ₱3,000,000, non-VAT, sworn declaration on file) or WI011 at 10% (over ₱3,000,000, VAT-registered, or no declaration). A GPP law firm’s payments to its own partners use WI152 (10%, cumulative payments up to ₱720,000) or WI153 (15%, over ₱720,000). A law firm organized as an ordinary corporation uses WC010 (10%, gross income up to ₱720,000) or WC011 (15%, over ₱720,000).

How does a solo lawyer know whether the 5% or 10% rate applies to her? #

The 5% rate applies only when both conditions hold: her gross income for the current taxable year has not exceeded ₱3,000,000, and she is non-VAT registered, confirmed by an Income Payee’s Sworn Declaration of Gross Receipts/Sales filed with the client together with a copy of her BIR Certificate of Registration. If either condition fails, or the client has no declaration on file, the client should withhold at the higher 10% rate.

Summary #

Engaging an individual, solo-practicing lawyer directly puts the client in the same individual professional-fee bracket used for any licensed professional under RR No. 11-2018 — ATC WI010 at 5% or WI011 at 10%, turning on the lawyer’s gross income and sworn declaration. That is a distinct withholding path from paying a law firm organized as a GPP, which is exempt from withholding at the client’s level under RMC No. 3-2012 (see Withholding Tax on GPP Professional Fees), and from paying a law firm organized as an ordinary corporation, which falls under the WC010/WC011 corporate bracket instead. For the general individual and corporate professional-fee rules this scenario builds on, see BIR Form 2307 for Professional Fees.