What is purpose code P1005?

Purpose code P1005 is the accounting code in RBI's group P10, Other Business Services. It covers accounting, auditing and bookkeeping.⁵⁶

Many outsourced finance teams in India bill foreign clients under it. The main trap is tax work, which has its own code in the current list.

What does the P1005 purpose code cover?

The P1005 purpose code covers accounting, auditing and bookkeeping work paid for by foreign clients. RBI's receipt purpose code list describes P1005 as: "Accounting, auditing, book keeping services".⁵⁶ DGFT's purpose code to SAC mapping reproduces the same wording.³ P1005 sits in group P10, "Other Business Services".⁵

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.⁵⁶

An earlier RBI list, now marked "Withdrawn" on the RBI website, described P1005 as "Accounting, auditing, bookkeeping and tax consultancy services".² Some websites still show that wording. In the current list tax consulting is P1015.⁵

When should you use the P1005 purpose code?

Use the P1005 purpose code when a foreign client pays you for accounting, audit or bookkeeping work.⁵ DGFT's mapping adds payroll services to the SACs linked to it.³

• Bookkeeping and accounts: You maintain books, close accounts or prepare financial statements for a client abroad.³
• Audit work: You provide financial auditing or audit support.³
• Payroll: DGFT maps payroll services (SAC 998223) to P1005, as well as to P1099.³

Where one invoice covers several of these services and tax work, use the code for the main service and confirm with your bank.⁵

Who uses the P1005 purpose code?

P1005 fits Indian exporters paid for accounting, audit or bookkeeping work.⁵ DGFT's mapping links it to "Financial auditing services", "Accounting and bookkeeping services", "Payroll services" and "Other similar services n.e.c".³

• Freelance bookkeepers: Individuals keeping accounts for small businesses abroad.
• Chartered accountancy firms: Firms providing audit support to audit firms overseas.
• Accounting outsourcing companies: Teams closing the books monthly for foreign clients.
• Payroll processors: Providers running payroll for clients abroad, where DGFT's payroll SAC applies.³

What transactions are covered under P1005?

Transactions covered under P1005 are fees for accounting, auditing, bookkeeping and related payroll work.⁵³ Each example below fits the description:

• Bookkeeping: For example, a freelance bookkeeper maintains accounts for small businesses in Australia.
• Audit support: For example, a chartered accountancy firm provides audit support to a UK audit firm.
• Month-end close: For example, an accounting outsourcing company closes the books monthly for US clients.
• Payroll: For example, a payroll processor runs payroll for a client in Singapore.

Which SAC codes does DGFT map to the P1005 purpose code?

DGFT's purpose code to SAC mapping (Version 1.0, 10 November 2023) lists these Services Accounting Codes (SAC) against P1005:³

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.⁴ The mapping is many-to-many, so the same SAC can appear against several purpose codes.³

When should you not use the P1005 purpose code?

Do not use the P1005 purpose code for tax advice, financial consulting or data processing, which have their own codes.⁵ Each case below names the code to compare:

• Tax returns and tax advice: Preparing tax returns or advising on tax is described by P1015.⁵
• Financial or management consulting: Consulting work is described by P1006.⁵
• Data entry or processing: Data base and data processing work is P0803.⁵
• Legal work: Legal services are P1004.⁵

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 P1005?

A payment under P1005 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.⁷⁴ 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.⁷

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.⁷ Exporters of services other than software may file the EDF on or before the date payment is received instead.⁷

How do you declare the P1005 purpose code?

You declare the P1005 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.⁴⁷ The steps below follow that order.

1. Match the work to the P1005 description: Compare what the foreign client pays for with the RBI description of P1005 and the neighbouring codes.⁵
2. Describe the service on the invoice: Describe the service on the export invoice in words that match the P1005 description, so the bank can see why the code fits.⁵
3. Give the bank the P1005 purpose code: Tell your bank that the purpose of the inward remittance is P1005 when the payment arrives, using the bank's own inward remittance process.⁴
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.⁷
5. Check the IRM and generate the e-BRC: Check that the bank's inward remittance message shows P1005, then generate the e-BRC on the DGFT portal and choose the SAC that corresponds to P1005.⁴

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).⁴

How does P1005 affect FIRA, GST and income tax?

The P1005 purpose code states the purpose of the payment on the bank's record; GST, realisation and income tax follow their own rules.⁴ The code matters most where the e-BRC and the SAC you choose must line up with it.⁴

• 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.⁴
• 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.⁸ Export of services is a zero rated supply, and a registered person can supply under bond or Letter of Undertaking without paying integrated tax.⁹
• 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.⁷
• 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 P1005 purpose code?

The common mistakes with the P1005 purpose code are choosing it for work another code describes, and leaving a wrong code uncorrected after the bank has reported it.⁵⁴

• Using the earlier-list wording: Some websites still show P1005 as including tax consultancy, which was its meaning in an earlier, withdrawn RBI list; in the current list tax consulting is P1015.²⁵
• 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.⁴ 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.⁴

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 P1005?

The purpose codes related to P1005 are the professional services codes around it in group P10 and the data processing code, listed below from RBI's list.⁵⁶

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.