Policy and purpose
- The State values the dignity of every human person and guarantees the rights of individuals who cannot afford legal counsel.
- The State promotes a just and dynamic social order ensuring the nation’s prosperity and independence, and freeing people from poverty through adequate social services and improved quality of life.
- The State guarantees free legal assistance to the poor and ensures that persons who cannot afford a counsel are provided with a competent and independent counsel, preferably of the person’s own choice, when determination shows the person cannot afford counsel.
- The State provides free legal assistance when services of counsel are necessary to secure the ends of justice and protect the rights of the party.
Definitions: “legal services”
- “Legal services” refers to any activity requiring the application of law, legal procedure, knowledge, training, and experiences.
- Legal services include legal advice and counsel.
- Legal services include the preparation of instruments and contracts.
- Legal services include appearance before administrative and quasi-judicial offices, bodies, and tribunals handling cases in court.
- Legal services include other similar services as may be defined by the Supreme Court.
Requirements to avail benefits
- A lawyer or professional partnership must secure a certification from the Public Attorney’s Office (PAO), the Department of Justice (DOJ), or an accredited association of the Supreme Court.
- The certification must indicate that the legal services to be provided are within the services defined by the Supreme Court.
- The certification must indicate that the PAO, DOJ, or accredited association cannot provide the legal services that will be provided by the private lawyer or firm.
- A Supreme Court-accredited association or organization must certify the number of hours actually provided by the lawyer or professional firm, based on actual undertaking of the legal services.
- The certification must be submitted to the Bureau of Internal Revenue (BIR) to avail the tax deductions provided in the Act.
- The certification must also be submitted to the DOJ for monitoring.
Incentives and tax deduction
- A lawyer or professional partnership rendering actual free legal services as defined by the Supreme Court is entitled to an allowable deduction from gross income.
- The allowable deduction equals the amount that could have been collected for the actual free legal services rendered.
- The allowable deduction also includes the alternative cap of up to ten percent (10%) of the gross income derived from actual performance of the legal profession.
- The allowable deduction is limited to the whichever is lower between (i) the amount that could have been collected and (ii) 10% of gross income.
- The actual free legal services covered by the deduction must be exclusive of the minimum sixty (60)-hour mandatory legal aid services required under the Rule of Mandatory Legal Aid Service for Practicing Lawyers under BAR Matter No. 2012 issued by the Supreme Court.
IEC campaign and public information
- The DOJ, in cooperation with the Philippine Information Agency (PIA), must conduct an annual IEC campaign.
- The IEC campaign must inform lawyers of the procedures and guidelines in availing the tax deductions under the Act.
- The IEC campaign must inform the general public that the State provides free legal assistance to those who cannot afford counsel.
Monitoring through report to Congress
- The DOJ must submit an annual report to both Houses of Congress.
- The report must indicate the number of parties who benefited from the Act.
- The report must state in detail the geographic location, demographic characteristics, and socioeconomic profile of the beneficiaries.
Implementing rules and regulations
- Within ninety (90) days from the Act’s effectivity, the BIR must formulate revenue regulations to implement the tax component envisioned in the Act.
- The Supreme Court must formulate implementing rules and regulations on:
- the legal services covered under the Act; and
- the process of accreditation of organizations and/or associations that provide free legal assistance.
Separability, repealing, and amendment
- If any provision is declared unconstitutional or invalid, the remaining provisions not affected remain in full force and effect (Separability Clause).
- Any law, decree, ordinance, or administrative circular inconsistent with the Act is amended, repealed, or modified accordingly (Repealing Clause).