Stable demand for notary services and the ability to earn 150-300 thousand rubles a month are two factors that encourage people to open notary offices. What does it take to start this business?
Business in the field of legal services differs significantly from other activities. If you decide to open a notary office, then you should understand that the procedure for starting this business has some features regarding registration and other things. You must understand all the intricacies of legal activity and doing business in this area.
In this article, we offer a general step-by-step guide that will answer key questions about how to open a notary office, how much money you need to start, what difficulties a novice entrepreneur can face and how much a notary can earn.
Demand for notary services today
Notary services are relevant for every citizen and are always in demand. Sooner or later, a person has a situation where one cannot do without a qualified consultation of a notary. Without legal registration and certification of the authenticity of a copy, it is impossible to enter into an inheritance, sell real estate, movable property, etc. The right to receive quality legal assistance is enshrined in Art. 48 of the Constitution of the Russian Federation. The notary is called upon to ensure the protection of the rights and legitimate interests of citizens on behalf of the state, performing notarial actions provided for by law.
One of the indicators indirectly confirming the stability of demand for notary services can be the dynamics of the popularity of requests in Google Trends. As you can see, the graph is fairly even with some positive dynamics over the past two years. A decrease in the popularity of the topic is observed in the same period at the end of December and the beginning of January, which is obviously associated with the New Year holidays.
Notary Experience Requirements
Before thinking about opening a notary office, you need to get not only the appropriate education, but also experience in the legal field. The specialist must meet the following requirements:
- completed higher education in a law school;
- at least two years of work experience in a law firm after graduation from a higher educational institution;
- At least one year of internship with an acting notary. For an internship, you can choose a private or public institution;
- a notary may be a person between the ages of 25 and 75;
- a document confirming that the qualification exam was passed successfully. If the notary fails to pass the test – both in practice and in theory – the next retake will be scheduled for the next year;
- have on hand a permit document, which is issued by the justice authorities or the notary chamber.
Obtaining a notary license and internship
According to Article 3 of the Fundamentals of the Legislation of the Russian Federation on Notaries dated February 11, 1993, citizens of the Russian Federation who have received a license to carry out this activity, who either work in state notary offices or conduct private practice, have the right to engage in notarial activities. The notary is also required to be a member of the notary chamber. Under Russian law, the activities of notaries are not considered entrepreneurial. Although this does not mean at all that it does not make a profit. Rather, the opposite is true: the services of notaries are always in demand, and the number of specialists working in this area is very limited.
Obtaining a license is one of the most important steps in starting this business. The license states that a citizen of the Russian Federation has the legal right to conduct and perform legal activities, and also has the right to open his own office, where private practice will be conducted. Authorized state bodies are engaged in registration and issuance of a license. To obtain it, you must complete an internship at a public notary’s office or with a private notary for at least one year and pass a qualifying exam. In certain cases (for example, if you have a long work experience in the legal profession), the duration of the internship can be reduced, but up to a maximum of six months.
However, for this it is necessary to obtain special permission from the justice authority and the notary chamber. The internship itself is not a problem. It is much more difficult to get a job in a notary’s office as an intern – the number of offices is limited, and there are a lot of applicants. After completing the internship, the future notary must pass the exam of the qualification commission, which is formed under the justice authorities of the constituent entities of the Russian Federation. However, it should be understood that even the successful passing of the exam does not guarantee that the desired vacancy will be received in a timely manner. Places of notaries are very limited.
In addition to the requirements for a preliminary one-year internship with a notary and passing an exam, the process of acquiring the status of a notary is complicated by the quota system: the number of notaries in each notary district is limited and is determined by the justice authority and the notary chamber. Although for acting notaries, this limitation is an advantage, since they will not have a shortage of clients due to high competition.
Please note: if within three years after obtaining a license you do not work as a notary assistant for any reason (for example, you could not get a job), the license is invalidated and you must retake the qualification exam to renew it.
Let us repeat: despite the fact that, according to the law, notarial activity is not considered as entrepreneurship, a notary has the right to open settlement and other accounts in banks (including foreign currency), hire and fire employees, dispose of the profits.
Services provided by the notary office
Notaries provide a wide range of services. Let’s single out those that are provided to customers one-time:
- Drafting donation and rent agreements;
- Conclusion of marriage contracts;
- Drawing up powers of attorney;
- Handling cases related to inheritance;
- Drawing up wills;
- Certification of transactions;
- Drawing up sales contracts;
- Preparation of certified copies of documents;
- Consent to leave the child.
Some notary offices provide corporate services for legal entities. In this case, the notary works individually with each company.
How much does it cost to open a notary office
This is one of the most important questions that arise for those who want to open a notary office. However, it is rather difficult to name the exact amount. It all depends on the region in which it is planned to open a notary office. On average, 150-200 thousand rubles will have to be invested in a business. Let’s take a closer look at the expense items.
To open a notary office, you need to rent an office space. Such an institution does not need a huge office – a small room for a couple of rooms with a total area of 20 sq.m. is suitable. The cost of renting such an office in the city center will be about 20 thousand rubles.
The average cost of renting office space in Russian cities
|CITY||AVERAGE RENTAL PRICE (THOUSAND RUBLES)|
|Moscow (12.5 million inhabitants)||28.8|
|St. Petersburg (5.4 million inhabitants)||19.3|
|Rostov-on-Don (1.1 million inhabitants)||12.2|
|Lipetsk (510 thousand inhabitants)||10.4|
It should also be borne in mind that a special archive must be organized in the notary’s office, which will increase over time and require more space. Therefore, the rented premises must have a certain “reserve” of the area.
Most importantly, choose a suitable office location. It is recommended to open an office in the city center to ensure a constant flow of customers. Here are some tips to help you choose the right place:
- the street on which the notary’s office will be located must be busy and passable;
- take care of a convenient neighborhood: it’s good if the notary’s office is located next to real estate and law firms, a translation agency, a law firm;
- if possible, the rented premises must be purchased and registered as property.
The prepared office must comply with all safety standards, as well as fire and sanitary standards. Keep in mind that if the notary decides to change his location, he is obliged to notify the territorial authorities, as well as the Notary Chamber, within three days.
For a notary office, you will need to purchase furniture, a computer, various forms, stationery and other consumables. We advise you to consider the possibility of placing an office in an office center – very often such tenants provide a room with office furniture.
You should also pay attention to the fact that a reliable alarm system is installed in the room where the notary’s office is located. It is not uncommon for such organizations to rob and take away seals and forms, on which they subsequently make fake powers of attorney and wills.
In total, 50-60 thousand rubles will have to be spent on the equipment of a notary’s office. In addition, it should be borne in mind that one of the cost items will be the production of a personal seal. It must contain the image of the State Emblem of the Russian Federation, the full name of the notary, the word “notary”, as well as an indication of the notary district in which he is authorized to act. By law, it must be made in only one copy.
No business can do without advertising. And notaries are no exception. First, outdoor advertising should be placed on the building where the office is located. A banner or sign will attract additional customers. The cost of a banner, including its installation, will be 10-15 thousand rubles.
Secondly, business cards that can be distributed to nearby institutions will be a good advertisement for a notary’s office. Development of business cards, including the creation of a layout and printing, will amount to 5 thousand rubles. In the future, it is possible to create a one-page Internet site, which will contain contacts, a basic list of services and their cost, as well as information about specialists. This will increase customer confidence.
Also, an effective method of promoting your services can be the creation of an active platform where you post useful information and recommendations, answer user questions. Of course, this option requires investments – both financial and temporary. But just such a format can become one of the best types of advertising for a notary office, which will distinguish it from competitors.
How else can you find clients for a notary office? Often, notaries agree on mutually beneficial cooperation with financial and credit institutions or real estate agencies. The scheme is extremely simple: an employee of the institution invites “his” notary when the client needs notary services, and receives a certain percentage of this.
At the initial stage, you will be able to carry out activities without assistants. But it’s still better to hire a secretary. Candidate requirements are knowledge of:
- laws and other regulatory legal acts of the Russian Federation, as well as regulatory documents regulating notarial activities;
- resolutions, orders, orders and other guidance materials and regulatory documents relating to the activities of notaries and record keeping;
- business organization;
- methods of registration and processing of documents;
- standards of the unified system of organizational and administrative documentation;
- rules for printing business letters using standard forms;
- business communication rules; PC rules.
Also, an employee of a notary’s office must be able to work in MS Word, MS Excel, Fine Reader, be literate, have good handwriting.
The duties of the secretary of the notary’s office include conducting telephone conversations; control over the timely consideration and submission of documents received for execution; verification of the correctness of the preparation of draft documents submitted to the notary for signature; drawing up letters, requests and other documents on behalf of a notary.
Important! Employees who are hired to work in a notary’s office should increase the efficiency of office work. They must be able to communicate with people, because very often it is after communicating with notary assistants that clients decide whether they should contact this specialist.
Another important nuance that exists in the work of a notary office. To protect against possible errors, you will need to take out professional liability insurance. In this case, the tariff will depend on several factors: the length of service of the notary, the term of insurance, the amount of insurance payment, etc. On average, professional liability insurance for a notary will cost about 5,000 rubles.
In total, starting your own business will cost 110,000 rubles. This amount will be required in the first stages of work.
Starting investments in opening a notary office
|Notary office rent||20 000|
|Furniture and equipment||60 000|
|Stationery and forms||3000|
|Registration of a license for notarial activities, production of a seal||2000|
|Professional liability insurance||5000|
In addition, do not forget about the monthly expenses of the notary office: payroll for employees, utility bills (including payment for communications and the Internet), taxes.
Features of taxation of notarial activities
Private notaries are a special subject of public relations: on the one hand, they are not engaged in commercial activities and their activities cannot be equated with the activities of individual entrepreneurs, and on the other hand, they have a special tax status, which makes them similar to individual entrepreneurs.
Notaries are required to apply the general (classical) taxation system and are subject to the following taxes:
- Value Added Tax.
- Personal property tax.
- Transport tax.
- Land tax.
- Insurance premiums (although this is not a tax, but in fact it is) + social accident insurance.
- Personal income tax.
Please note that notaries do not have to pay income tax, since for them it has been replaced by personal income tax! Paragraph 2 of Art. 54 of the Tax Code of the Russian Federation determines that notaries engaged in private practice, lawyers calculate the tax base for the results of each tax period on the basis of data on income and expenses and business transactions in the manner determined by the Ministry of Finance of the Russian Federation. By default, all income of lawyers and notaries will be subject to personal income tax at a rate of 13%.
How much does a notary earn
There are also some nuances in pricing for the services of a notary office. The price for the services of a notary’s office consists of two parts: the tariff, which is established by law, and the amount for the remuneration of the notary’s services. Thanks to the legally fixed tariffs for notarial acts, the prices for all notaries are the same. However, the payment for notary services is always higher than the tariff rate for the cost of notarial acts, since the notary has the opportunity to issue an invoice to the client for the provision of services that are not notarial acts.
It is possible to present the pricing of services of a notary office in the form of a simple formula: Cost of services = Tariffs + Services of a legal and technical nature. The notary must determine the prices for his services independently. It is recommended to do this when drawing up a business plan, within the framework of which an analysis of the local market will be carried out and the rates applicable in a particular region will be considered.
According to the Federal Notary Chamber, the average salary of a Russian notary is 60% of the fee for the services provided. It should also be taken into account that the income of a private notary is reduced due to the following expenses: salaries of employees of the notary office, rent for the use of premises and utilities, taxes and a mandatory membership fee to the notary chamber, which is at least 5% of the amount of annual income.
It is difficult to name specific amounts of income of a notary office, since it depends on many factors. However, the average income is often 150-300 thousand rubles per month. It will take 2-6 months for the development of the case, during which the notary will be able to declare his services and collect a client base. Such a business can pay off in 4-8 months. The most important factor in achieving success is qualifications, thanks to which the business will remain competitive. Opening a notary’s office is a responsible step that requires certain efforts and knowledge from the entrepreneur.
Risks of working as a notary
The main risks in the work of a notary office are associated with two factors – people and papers. Notarial activities are associated with a large amount of documentation that require careful verification. In addition, a specialist should be well versed in the psychology of clients, because every day completely different people turn to him, each of which should be approached individually. If the client is dissatisfied with the work of the notary office, he can write a complaint to the Notary Chamber. In this case, the notary may even lose his job.
Let’s briefly list the risks of a notary’s office:
- high professional responsibility;
- tight control over activities from the Notary Chamber;
- criminal liability for private notaries (Article 202 of the Criminal Code) in case of abuse of power;
- a limited number of notary offices, which can complicate employment;
- the risk of pressure from criminal “elements” to falsify documents or the risk of being drawn into schemes by fraudsters.
The activities of a notary’s office are associated with a whole list of risks, the occurrence of which entails serious consequences. However, the high level of income makes this activity very attractive.