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PayPal, Wise or Payoneer: What GST and the RBI's Software Consultancy Code Mean for Freelance Developers

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Short answer

Freelance development for foreign clients is usually reported under P0802, software consultancy/implementation.1 Exports are zero-rated, and a registered developer invoices without IGST under an LUT.23 From 1 October 2026 software exports need an Export Declaration Form (EDF).4 Information technology is a specified profession under section 62(4) of the Income-tax Act, 2025.5 PayPal charges 4.40% plus a fixed fee.6

Applies toRules involvedPlatforms comparedLast verified
Freelance software developers in India with clients abroadIGST Act sections 2(6) and 16, LUT237; FEMA 2026 Regulations: EDF and nine-month realisation48; purpose code P08021; Income-tax Act, 2025 section 58(2)9Razorpay, Karbon Business, Skydo, Payoneer, PayPal, Wise6101112131428 October 2026 (rules and published fees)415

1,000 USD = ₹94,243 at the reference rate for 13 November 2026 (European Central Bank data).

Estimated rupees received, on published fees

Sorted by estimated rupees received, highest first. Only providers that publish both their fee and their conversion markup for this currency and method can be estimated.

#Provider and routeBest forFee (+GST)MarkupYou receiveCost
1Karbon BusinessLowest estimated costBank transfer to a Karbon virtual USD accountUS bank transfers and marketplace payouts₹942plus GST, rate not stated0%₹93,131 to ₹93,3011.00 to 1.18%
2RazorpayMoneySaver Export Account: bank transfer to virtual account details (Standard plan)Local transfers from the US, UK and eurozone₹1,000plus GST, rate not stated0%₹93,063 to ₹93,2431.06 to 1.25%
3WinvestaGlobal Collections Account, standard plan (up to 2,000 a month per currency)Local transfers with a published per-payment fee₹1,4350%₹92,8091.52%
4SkydoPayment link (InstaLinks) paid by ACH debitLocal bank transfers from major markets₹1,885plus GST, rate not stated0%₹92,019 to ₹92,3582.00 to 2.36%
5PayoneerLocal bank transfer to Payoneer receiving account detailsMarketplace payouts such as Amazon or Upwork₹0no GST stated1 to 4%₹90,473 to ₹93,3011.00 to 4.00%
6PayPalInternational commercial transaction received into a PayPal account (PayPal checkout or invoice)Clients paying by card or PayPal balance₹4,175no GST stated3 to 4%₹86,465 to ₹87,3667.30 to 8.25%

Not estimated because pricing is not fully published: Cashfree Payments, Dodo Payments, PingPong, Stripe, Tazapay, TransFi, Wise.

Where a provider says GST applies to its fee but not at what rate, the range runs from no GST to 18%, the rate Skydo, Stripe and Winvesta state on their pages. Estimates use each provider's published fee, conversion markup, GST on fees and FIRA charge, checked 2026-10-28, against the reference rate. They exclude charges taken by intermediary banks and your own bank, and the rate a provider actually applies at the time of conversion. Check the provider's pricing page before you choose. The order is calculated only from these published numbers; no provider can pay to change its position, and there are no affiliate links.

Freelance software developers in India build web apps, mobile apps, APIs and integrations for startups and agencies abroad, often through direct contracts or marketplaces. The RBI code that fits most of this work is P0802, and the GST treatment is zero-rating under an LUT.123 PayPal, Wise and Payoneer, the three providers named in the question, differ in fees, conversion pricing and how they record the purpose code.62324

The persona guide international payments for software developers covers more routes, including marketplaces. Confirm your position with a chartered accountant (CA).

How do PayPal, Wise and Payoneer compare for freelance developers in India?

PayPal suits developer clients who pay by card or PayPal balance, Wise suits clients paying by bank transfer to local account details, and Payoneer suits developers paid by marketplaces such as Upwork.142526 The table adds the three providers with the lowest estimated cost on a USD 2,000 receipt from published fees, ordered by that estimate, cheapest first, with Wise (no published INR conversion percentage) after.10111223

PlatformBest forFeeFX markupSettlementFIRARBI PA-CB statusSource
RazorpayLocal transfers from the US, UK and eurozone271% per MoneySaver bank transfer plus GST, with a flat fee of ₹1,000 below ₹1,00,000; international cards up to 3% plus GST1028Razorpay says 0% FX markup on MoneySaver bank transfers; card conversion markup not published1029T+1 for push bank transfers (ACH, FPS, SEPA, SWIFT); around T+5 business days for ACH debit Flash Links2730Foreign Inward Remittance Statement (FIRS) emailed within 24 hours after settlement for bank transfers2731Razorpay Payments Private Limited is listed as PA-CB for inward and outward transactions15Razorpay pricing and docs; RBI list10152728293031
Karbon BusinessUS bank transfers and marketplace payouts321% transaction fee, listed on Karbon's PayPal alternative page110% (freelancer page); 0.5% to 1.0% (PayPal alternative page)3211Karbon says 24 to 48 hours32FIRA for every transaction from an unnamed banking partner; cost not published32Not on the RBI list itself; its terms run export receipts under a partner the RBI lists as a PA-CB1533Karbon pages and terms; RBI list11153233
SkydoLocal bank transfers from major markets34USD 19 plus GST up to USD 2,000; USD 29 plus GST from USD 2,001 to USD 10,000; 0.3% plus GST above USD 10,00012350% markup on the mid-market rate (product page); retail rate set by Skydo or its partner banks (terms)3637Skydo's terms say T+1 to T+3 business days, depending on currency and corridor37Free FIRA on every payment received, Skydo says3638Skydo Technologies Private Limited is listed as PA-CB-I and O, authorised 8 January 202615Skydo FAQs and terms; RBI list121535363738
PayoneerMarketplace payouts such as Amazon or Upwork26Payment request by card 2.90% + $0.49; ACH bank debit (US only) 1%; receiving-account fees are shown in your account131% to 4% of the amount when converted to INR on withdrawal, depending on region and volume13Within 24 hours (multi-currency account page); within 48 hours (pricing page)1339Free digital FIRA for each transaction from Payoneer's partner AD bank, within 24 to 72 hours24In-principle PA-CB authorisation on 22 January 2026; RBI lists the application as under process as of 16 October 2026; Payoneer also lists an RBI OPGSP registration404142Payoneer pricing, help and press pages; RBI status list132439404142
PayPalClients paying by card or PayPal balance254.40% plus a fixed fee (0.30 USD for USD) per international commercial transaction63.0% or 4.00% above the base exchange rate, depending on the conversion type6Up to 5 business days to reach the Indian bank account43Free weekly digital FIRA from February 2026; custom FIRA at 100 INR plus 18% GST per transaction44Listed as an existing PA-CB with in-principle authorisation granted, as on 16 October 202641PayPal fee, help and FIRA pages; RBI status list6414344
WiseBank transfers to local account details14Equivalent of 2 USD per transfer to the INR account (help article); free e-FIRC (receive pricing page); 6.11 USD per USD wire or Swift receipt in its business fee table; 18% GST on fees144523Mid-market rate plus a conversion fee; no percentage published for INR23Wise says INR reaches the Indian bank within 1 to 2 days14e-FIRC for each transfer, emailed within 3 working days14Wise Payments India Private Limited is listed as PA-CB-I, authorised 12 March 202615Wise help and pricing pages; RBI list14152345

Wise Business onboards sole traders and freelancers with a personal PAN and an INR bank account in their own name, while Wise personal accounts in India cannot receive money.4647

Which RBI and GST rules apply to freelance developers?

The rules that apply to a freelance developer paid from abroad are the IGST Act export and zero-rating provisions, the LUT and registration rules, the 2026 FEMA export regulations and the presumptive scheme for information technology professionals.23457

RuleBest for (who it applies to)Plain meaningSource
IGST Act section 2(6)Every developer billing a client located outside IndiaAll five export conditions must hold, including payment in convertible foreign exchange7CBIC7
IGST Act section 13(2)Remote development delivered onlinePlace of supply is the client's location unless a special rule applies48CBIC48
IGST Act section 16 and LUTGST-registered developersZero-rated exports invoiced without IGST under an LUT for the financial year23CBIC, GST portal23
Registration exemptionDevelopers with small turnoverNo registration required up to ₹20 lakh aggregate turnover for inter-State services1718Notification 10/2017-IT, CGST Act1718
EDF, 2026 RegulationsEvery developer exporting software from 1 October 2026File the EDF within 30 days from the end of the invoice month4RBI4
Realisation, regulation 5Developers with slow-paying clientsCollect payment within nine months of the invoice, or twelve months in rupees8RBI8
Income-tax Act, 2025, sections 58(2) and 62(4)Resident individual developersInformation technology is a specified profession, so the 50% deemed profit scheme can apply59Income Tax Department59

See GST registration for freelancers who export and section 44ADA for freelancers.

Which purpose code applies to freelance developers?

Freelance development is usually reported under P0802, with P0807, P0804 and P0803 covering related receipts.149 Receipt codes come from RBI A.P. (DIR Series) Circular No. 84 of 29 February 2012.16

CodeBest for (transaction type)Official RBI descriptionSource
P0802Custom development, implementation and technical consultingSoftware consultancy/implementation (other than those covered in SOFTEX form)HDFC, DGFT149
P0807Software exports your bank classifies as off-siteOff-site Software ExportsHDFC, DGFT149
P0804Support and maintenance billed separatelyRepair and maintenance of computer and softwareHDFC, DGFT149
P0803Data engineering or data processing workData base, data processing chargesHDFC, DGFT149

DGFT maps IT consulting and support (SAC 998313) and IT design and development (SAC 998314) to both P0802 and P0807.49 Whether banks now prefer P0802 or P0807 is unclear after SOFTEX ended, so see P0802 or P0807 after SOFTEX and ask your bank.50

Which option is cheapest at $500, $2,000 and $5,000?

The cheapest option for a freelance developer depends on invoice size and payment method, because flat per-payment fees fall as a share of larger invoices while card and PayPal routes carry percentage fees.61012 The table below works out INR received at today's rate from published fees.

PlatformBest forINR on USD 2,000INR on USD 5,000INR on USD 10,000Cost on USD 5,000
SkydoMost INRTransfer to Skydo local account details or international SWIFT accountLocal bank transfers from major markets₹1,86,373₹4,67,991₹9,39,2060.68%
Karbon BusinessBank transfer to a Karbon virtual USD accountUS bank transfers and marketplace payouts₹1,86,262 to ₹1,86,601₹4,65,655 to ₹4,66,503₹9,31,311 to ₹9,33,0071.00 to 1.18%
RazorpayMoneySaver Export Account: bank transfer to virtual account details (Standard plan)Local transfers from the US, UK and eurozone₹1,86,262 to ₹1,86,601₹4,65,655 to ₹4,66,503₹9,31,311 to ₹9,33,0071.00 to 1.18%
PayoneerLocal bank transfer to Payoneer receiving account detailsMarketplace payouts such as Amazon or Upwork₹1,80,947 to ₹1,86,601₹4,52,367 to ₹4,66,503₹9,04,734 to ₹9,33,0071.00 to 4.00%
PayPalInternational commercial transaction received into a PayPal account (PayPal checkout or invoice)Clients paying by card or PayPal balance₹1,72,958 to ₹1,74,760₹4,32,436 to ₹4,36,940₹8,64,899 to ₹8,73,9087.27 to 8.23%

Not estimated because pricing for USD is not fully published: Wise.

Ranked by INR received on USD 5,000. Reference rate: European Central Bank data for 13 November 2026. Fees, conversion markup, GST on fees and FIRA charges as published by each provider, checked 28 October 2026. Ranges appear where a provider publishes a range or does not state its GST rate. Intermediary bank charges are excluded. See the methodology.

For example, a $2,000 sprint invoice paid by bank transfer costs 1.00 to 1.18% with Razorpay's 1% MoneySaver fee plus GST and about 1.12% with Skydo's USD 19 plus GST.1012 Through PayPal the same invoice costs about 7.28 to 8.24% after the 4.40% fee, the 0.30 USD fixed fee and the 3.0% or 4.00% conversion fee.6

What documents follow each payment?

Each foreign payment to a freelance developer leaves a FIRA, e-FIRC or FIRS, and the developer adds a monthly EDF, a self-certified e-BRC and an LUT-endorsed export invoice if registered.345152

DocumentBest forWhat it doesSource
FIRA, e-FIRC or FIRSMatching payments to invoicesPayPal issues a free weekly digital FIRA, Wise an e-FIRC per transfer, Payoneer a digital FIRA per transaction142444Provider pages142444
e-BRCGST refunds and export recordsSelf-certified on DGFT from the bank's inward remittance messages51DGFT51
EDFEvery developer exporting software from 1 October 2026Filed within 30 days from the end of the invoice month4RBI4
LUTGST-registered developersZero-rated invoicing without IGST353GST portal, CBIC353
Form W-8BENDevelopers with US clientsGiven by a non-US individual to the US payer20IRS20

How the EDF works for PayPal and payment aggregator receipts in practice is not spelled out, so ask your AD bank how to link them.4 See EDF for service exporters.

What changes in 2026 for freelance developers?

The 2026 changes for freelance developers are the end of SOFTEX, the EDF, the nine-month realisation period and the move to the Income-tax Act, 2025 with new section numbers and forms.485054

  • SOFTEX superseded: Circular No. 20 supersedes the SOFTEX circulars from 1 October 2026, and the EDF covers software exports.450
  • Realisation period: Nine months from the invoice date, after the 15-month window ended on 5 June 2026.855
  • New tax law: The Income-tax Act, 2025 applies from 1 April 2026, and tax year 2026-27 runs from 1 April 2026 to 31 March 2027.54
  • Section 44ADA: The 50% scheme is now section 58(2), Table row 3.9
  • Foreign tax credit: Form 44 under rule 76 of the Income-tax Rules, 2026 applies from tax year 2026-27.56
  • Due date: The return due date for non-audit business and profession cases moved to 31 August.22

The section 44ADA calculator shows the presumptive tax arithmetic.

How did we verify this?

We checked this page against the sources below on 31 October 2026. Provider fees, conversion markups and RBI payment aggregator (PA-CB) status were checked on 28 October 2026. Rupee amounts use European Central Bank reference rates for 13 November 2026. Read our methodology or report an error.

  1. [1]HDFC Bank: Inward Remittance Purpose Codes (bank reproduction of the RBI list, checked 2026-10-28)
  2. [2]CBIC: IGST Act, 2017, section 16 (zero-rated supply)
  3. [3]GST portal: User guide, Furnishing of Letter of Undertaking (FORM GST RFD-11)
  4. [4]RBI: Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, Notification No. FEMA 23(R)/2026-RB, amended up to 22 September 2026 (regulations 3, 4, 5, 6, 7, 13 and 19)
  5. [5]Income Tax Department: Income-tax Act, 2025 as amended by the Finance Act, 2026 (sections 58, 62(4), 156 and 202)
  6. [6]PayPal India, PayPal Merchant Fees (page last updated 28 March 2024) (checked 2026-10-28)
  7. [7]CBIC: IGST Act, 2017, section 2 (definition of export of services, clause 6)
  8. [8]RBI: Notification No. FEMA 23(R)/(1)/2026-RB dated 22 September 2026, amending regulation 5 (realisation period)
  9. [9]Income Tax Department: Income-tax Act, 2025, section 58 (presumptive taxation)
  10. [10]Razorpay, Multi-Currency Account for International Bank Transfers (MoneySaver Export Account pricing) (checked 2026-10-28)
  11. [11]Karbon Business, PayPal Alternative comparison page (checked 2026-10-28)
  12. [12]Skydo FAQs, How much does Skydo charge? (checked 2026-10-28)
  13. [13]Payoneer India, Payoneer Fees (checked 2026-10-28)
  14. [14]Wise Help Centre, Receiving payments for Indian businesses (checked 2026-10-28)
  15. [15]RBI: Certificates of Authorisation issued under the Payment and Settlement Systems Act, 2007, Payment Aggregators, list as on 16 October 2026 (checked 2026-10-28)
  16. [16]RBI: A.P. (DIR Series) Circular No. 84 dated 29 February 2012, Compilation of R-Returns: Reporting under FETERS (purpose codes)
  17. [17]Notification No. 10/2017-Integrated Tax (exemption from registration for inter-State supplies of taxable services up to ₹20 lakh), GSTZen reproduction
  18. [18]CBIC: CGST Act, 2017, section 2(6) (aggregate turnover includes exports)
  19. [19]PayPal India Help, What is the Purpose Code? (checked 2026-10-28)
  20. [20]IRS: Instructions for Form W-8BEN
  21. [21]IRS: Nonresident aliens, sourcing of income
  22. [22]CBDT: FAQs on Budget 2026 (return due date for non-audit business and profession cases)
  23. [23]Wise India, Fees for getting paid (Wise Business receive pricing) (checked 2026-10-28)
  24. [24]Payoneer Help Center, Digital FIRA FAQ (checked 2026-10-28)
  25. [25]PayPal India, User Agreement for PayPal Services (last updated 13 January 2025) (checked 2026-10-28)
  26. [26]Payoneer, How to use Payoneer in India (last modified 18 September 2026, checked 2026-10-28)
  27. [27]Razorpay Docs, International Bank Transfer (MoneySaver Export Account) (checked 2026-10-28)
  28. [28]Razorpay, Pricing, International Payments and International Bank Transfers tabs (checked 2026-10-28)
  29. [29]Razorpay Docs, Currency Conversion (checked 2026-10-28)
  30. [30]Razorpay Docs, Flash Links (ACH Debit) (checked 2026-10-28)
  31. [31]Razorpay Docs, FIRS Automated Process (checked 2026-10-28)
  32. [32]Karbon Business, Karbon for Freelancers (checked 2026-10-28)
  33. [33]Karbon Forex Terms and Conditions, Interropac Private Limited (checked 2026-10-28)
  34. [34]Skydo FAQs, What countries can I get paid locally through Skydo? (checked 2026-10-28)
  35. [35]Skydo, home page fee table (checked 2026-10-28)
  36. [36]Skydo, Receive international payments as a freelancer in India (product page) (checked 2026-10-28)
  37. [37]Skydo, Terms of Use, last updated 9 April 2026 (checked 2026-10-28)
  38. [38]Skydo FAQs, What is accepted for GST filings and banks between FIRA and FIRC? (checked 2026-10-28)
  39. [39]Payoneer India, Multi-currency account page and FAQs (checked 2026-10-28)
  40. [40]Payoneer press release, Payoneer receives in-principle authorization as Cross-Border Payment Aggregator in India, 22 January 2026
  41. [41]RBI: Status of Applications received under the Payment and Settlement Systems Act, 2007, as on 16 October 2026 (checked 2026-10-28)
  42. [42]Payoneer India, Payoneer's multi-jurisdictional licenses (checked 2026-10-28)
  43. [43]PayPal India Help, How do I transfer funds to my bank account? (checked 2026-10-28)
  44. [44]PayPal India, Foreign Inward Remittance Advise (FIRA) (checked 2026-10-28)
  45. [45]Wise India site, Wise Business pricing, fees at a glance (checked 2026-10-28)
  46. [46]Wise Help Centre, How to verify your Indian business to receive payments (checked 2026-10-28)
  47. [47]Wise India, Receive pricing (personal accounts) (checked 2026-10-28)
  48. [48]CBIC: IGST Act, 2017, section 13, sub-sections (2) and (4) (place of supply where supplier or recipient is outside India; immovable property) (checked 2026-10-31)
  49. [49]DGFT: Purpose Code and SAC Code Mapping, Version 1.0, 10 November 2023
  50. [50]RBI: A.P. (DIR Series) Circular No. 20 dated 16 January 2026 (supersedes the earlier SOFTEX circulars from 1 October 2026)
  51. [51]DGFT: eBRC system, self-certification of eBRC from bank inward remittance messages (IRMs), Trade Notice 33/2023-24 dated 10 November 2023 (checked 2026-10-28)
  52. [52]CBIC: CGST Rules, 2017, rule 46 (tax invoice, export endorsement)
  53. [53]CBIC: Circular No. 40/14/2018-GST (LUT deemed accepted on generation of ARN)
  54. [54]PIB: Income-tax Act, 2025 comes into force from 1 April 2026
  55. [55]RBI: Notification No. FEMA 23(R)/(8)/2026-RB, realisation period restored to nine months from 5 June 2026
  56. [56]Income Tax Department: Income-tax Rules, 2026 (rule 76 and Form 44, foreign tax credit)

Frequently asked questions

What is the RBI purpose code for software consultancy?+

The RBI purpose code for software consultancy is P0802, described as software consultancy/implementation (other than those covered in SOFTEX form). Off-site software exports have their own code, P0807. Support billed separately fits P0804, repair and maintenance of computer and software. Confirm with your bank which code it expects.116

Do freelance developers need GST registration for foreign clients?+

A freelance developer making only inter-State supplies of services is exempt from GST registration up to ₹20 lakh aggregate turnover, or ₹10 lakh in special category States, and export turnover counts. Registration is needed to file an LUT, which lets a developer export without paying IGST.31718

Should a freelance developer set the purpose code before the first PayPal withdrawal?+

PayPal India says a purpose code is selected once during account setup and must be in place before funds can be withdrawn to an Indian bank account. A freelance developer should choose the code that matches the work, usually P0802, before the first client payment arrives.119

Do US clients withhold tax from an Indian freelance developer?+

A non-US individual gives Form W-8BEN to the US payer. The IRS treats services performed outside the US as generally foreign-source income for a non-resident alien, which is generally not subject to US withholding, so a developer working from India should send the form when the client asks.2021

Can a freelance developer use the 50% presumptive tax scheme?+

Information technology is a specified profession under section 62(4) of the Income-tax Act, 2025. A resident individual developer can use the 50% deemed profit scheme in section 58(2), Table row 3, which replaced section 44ADA, with gross receipts up to ₹50 lakh, or ₹75 lakh if cash receipts are within 5%.59

When is a freelance developer's EDF due?+

A freelance developer's EDF is due within 30 days from the end of the month of invoicing under the 2026 Regulations. The option to file on or before the payment date is open only to exporters of non-software services, so developers should plan a monthly EDF routine with their AD bank.4

Which tax return due date applies to freelance developers in 2026-27?+

CBDT's Budget 2026 FAQs say the return due date for non-audit business and profession cases moved to 31 August. The ITR form for tax year 2026-27 had not been notified as of 28 October 2026, so file using the form notified for the tax year.22

This page is general information for Indian service exporters, not tax or legal advice. Rules change and outcomes depend on your facts, so confirm with a chartered accountant before acting.

Keep reading

Profession

How should a software developer in India receive payments from foreign clients?

How Indian software developers get paid by foreign clients: export of services test, purpose codes P0802 and P0807, fee types, GST LUT and section 58 tax.

Purpose codes

Which purpose code should a software developer or IT company use for export receipts?

Purpose codes for software and IT service exports from India: P0802, P0807, P0803, P0804, P0801 and P0902, how DGFT's IT e-BRC rules use them, and how to choose.

Tax

Can Indian freelancers use section 44ADA (now section 58) to pay tax on 50% of their income?

How presumptive tax for professionals works for Indian freelancers paid in foreign currency: old 44ADA, new section 58, limits, 50% income, advance tax.

GST

Do freelancers with foreign clients need GST registration?

An individual freelancer billing foreign clients must register for GST only above ₹20 lakh aggregate turnover. How to count it, and when registering early makes sense.

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