What is purpose code P0902?

Purpose code P0902 covers licence fees: money you receive for letting someone abroad use something you already own, such as a manuscript, a film, a patent or a trademark.⁴⁵

The distinction that matters is between licensing an existing work and being paid to create a work to order. This page explains that line and the neighbouring codes.

What does the P0902 purpose code cover?

The P0902 purpose code covers licence fees received for letting someone abroad use produced originals or prototypes, patents, copyrights, trademarks, industrial processes and franchises. RBI's receipt purpose code list describes P0902 as: "Receipts for use, through licensing arrangements, of produced originals or prototypes (such as manuscripts and films), patents, copyrights, trademarks, industrial processes, franchises etc."⁴⁵ DGFT's purpose code to SAC mapping reproduces the same wording, cut short in its table.² P0902 sits in group P09, "Charges for the use of intellectual property n.i.e".⁴

The list comes from A.P. (DIR Series) Circular No. 84 dated 29 February 2012, which told banks to report all foreign exchange transactions under a revised purpose code list from April 2012.¹ RBI's annex PDF showed a captcha page when this page was checked, so the wording above is quoted from the HDFC Bank and DBS Bank India reproductions, which match each other word for word.⁴⁵

When should you use the P0902 purpose code?

Use the P0902 purpose code when a foreign client pays for the right to use a work, invention or brand you already own, under a licence.⁴ The test is whether the client is paying for a right or for new work.⁴

• You own the work: The payment is for the use of something that already exists, such as a manuscript, film, photograph, software product, patent or trademark.⁴
• The payment is a licence fee or royalty: The P0902 description covers receipts "through licensing arrangements".⁴
• No new work is commissioned: If the client pays you to create the work, the payment is for a service, and P1101 or P1007 may describe it better.⁴

If more than one description could fit, confirm P0902 with your bank before the payment is credited.⁴

Who uses the P0902 purpose code?

P0902 fits Indian owners of intellectual property who license it to users abroad.⁴ DGFT's mapping links P0902 to licensing SACs for software and databases, films and recordings, art works, manuscripts and books, R&D products and trademarks, and also to "Specialty design services" (998391) and "Design originals" (998392).²

• Authors and publishers: Writers licensing translation, reprint or adaptation rights in a manuscript.
• Filmmakers and music owners: Owners of finished films, recordings or programmes licensing broadcast or streaming rights.
• Photographers and illustrators: Creators licensing existing images or art works to agencies and publishers abroad.
• Software companies: Owners licensing the right to use their software or databases.²
• Patent and trademark holders: Inventors and brand owners receiving royalties from overseas manufacturers or licensees.

What transactions are covered under P0902?

Transactions covered under P0902 are licence fees and royalties for existing originals, patents, copyrights and trademarks.⁴ Each example below fits the description:

• Book rights: For example, an author licenses translation rights in a manuscript to a foreign publisher.
• Film licensing: For example, a filmmaker licenses a finished documentary to an overseas streaming service.
• Image licensing: For example, a photographer or illustrator licenses existing images to a foreign agency.
• Patent royalties: For example, a patent holder receives royalties from an overseas manufacturer, or a software company licenses its product to a customer abroad.

Which SAC codes does DGFT map to the P0902 purpose code?

DGFT's purpose code to SAC mapping (Version 1.0, 10 November 2023) lists these Services Accounting Codes (SAC) against P0902, among others where noted:²

The mapping lists 4 more SAC codes against P0902; see the DGFT file for the full list.²

When you generate an electronic Bank Realisation Certificate (e-BRC) on the DGFT portal, DGFT says you must choose the SAC that corresponds to the purpose code on the remittance.³ The mapping is many-to-many, so the same SAC can appear against several purpose codes.²

When should you not use the P0902 purpose code?

Do not use the P0902 purpose code when the client pays you to produce new work or when another code names the payment more precisely.⁴ Each case below names the code to compare:

• Video made to order: A video editor producing a film to order would compare P1101.⁴
• Advertising work: An agency producing an ad campaign would compare P1007, "Advertising, trade fair service".⁴
• Franchise fees: Fees for franchise services are P0901, "Franchises services".⁴
• Publishing services: Publishing and printing work for a client is P1017.⁴

Where a payment sits on the line between two codes, the contract and invoice usually show which service the client is paying for, so keep them ready for the bank.

What documents are required for P0902?

A payment under P0902 needs the documents any export of services needs: an invoice, the Export Declaration Form (EDF), and the bank's inward remittance record that the e-BRC is generated from.⁶³ Under regulation 3(2) of the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 (the 2026 Regulations), an exporter of services files the EDF with the specified authority within 30 days from the end of the month in which the invoice was raised.⁶

For software, the specified authority can also be Software Technology Parks of India (STPI), and in a Special Economic Zone it is the Development Commissioner.⁶ Exporters of services other than software may file the EDF on or before the date payment is received instead.⁶

How do you declare the P0902 purpose code?

You declare the P0902 purpose code by telling your bank the purpose of the inward remittance, then making sure the same code carries through to the EDF and the e-BRC.³⁶ The steps below follow that order.

1. Match the work to the P0902 description: Compare what the foreign client pays for with the RBI description of P0902 and the neighbouring codes.⁴
2. Describe the service on the invoice: Describe the service on the export invoice in words that match the P0902 description, so the bank can see why the code fits.⁴
3. Give the bank the P0902 purpose code: Tell your bank that the purpose of the inward remittance is P0902 when the payment arrives, using the bank's own inward remittance process.³
4. File the Export Declaration Form: File the EDF with the specified authority within 30 days from the end of the month in which the invoice was raised, or for non-software services on or before the date payment is received.⁶
5. Check the IRM and generate the e-BRC: Check that the bank's inward remittance message shows P0902, then generate the e-BRC on the DGFT portal and choose the SAC that corresponds to P0902.³

DGFT's eBRC FAQs place e-BRC generation under Services, then eBRC, then Generating eBRC, after you register on the DGFT website and link your Importer Exporter Code (IEC).³

How does P0902 affect FIRA, GST and income tax?

The P0902 purpose code states the purpose of the payment on the bank's record; GST, realisation and income tax follow their own rules.³ The code matters most where the e-BRC and the SAC you choose must line up with it.³

• FIRA: Ask your bank for its inward remittance advice, often called a Foreign Inward Remittance Advice (FIRA), and check that it shows the same purpose code before you rely on it for GST or bank records.
• e-BRC: DGFT describes the e-BRC as its confirmation that the exporter has received payment for the export of goods or services, and says the SAC you choose must correspond to the purpose code.³
• GST: A supply is an export of services under section 2(6) of the IGST Act, 2017 when the supplier is in India, the recipient is outside India, the place of supply is outside India, payment is received in convertible foreign exchange (or in Indian rupees where RBI permits), and the two are not merely establishments of a distinct person.⁷ Export of services is a zero rated supply, and a registered person can supply under bond or Letter of Undertaking without paying integrated tax.⁸
• Realisation: Regulation 5(1) of the 2026 Regulations requires the value of exported services to be realised within nine months from the date of invoice, or twelve months where the export is invoiced or settled in Indian rupees.⁶
• Income tax: The sources on this page do not cover income tax, and how a receipt is taxed depends on your facts, so confirm it with a chartered accountant.

For the GST side in more depth, see purpose codes and GST on export of services.

What are the common mistakes with the P0902 purpose code?

The common mistakes with the P0902 purpose code are choosing it for work another code describes, and leaving a wrong code uncorrected after the bank has reported it.⁴³

• Treating commissioned work as a licence: A payment to create a work is a service, so P0902 does not describe it even if the client receives rights in the result.⁴
• Leaving a wrong code in place: DGFT's eBRC FAQs say exporters must contact the bank to request a purpose code change, and that banks can amend the inward remittance message (IRM) they report to DGFT.³ Send the bank the remittance reference, the code used, the code you need and your invoice.
• Choosing a SAC that does not match: DGFT says exporters must choose the SAC that corresponds to the purpose code when generating an e-BRC.³

The full steps are in how to correct a purpose code after payment, and the effects are covered in what happens if you use the wrong purpose code.

Which purpose codes are related to P0902?

The purpose codes related to P0902 are the franchise, media, advertising, publishing and software codes below, from RBI's list.⁴⁵ P0902 is easiest to place by asking whether the client pays for a right or for work.

To compare every receipt code, see the RBI purpose codes list for exporters, or shortlist codes for your work with the purpose code finder. Where a payment could fit more than one description, confirm the code with your bank or a chartered accountant before the money is credited.