PayPal, Wise or Payoneer: What GST and the RBI's Advertising Purpose Code Mean for Digital Marketing Agencies
- Author:
- Manoj Sharma
- Verified by:
- Editorial team
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Short answer
Digital marketing agencies paid through PayPal, Wise or Payoneer follow the same 2026 rules. RBI's advertising purpose code is P1007, while P0804 covers computer and software repair. The FEMA Export and Import Regulations, 2026 require realisation within nine months of the invoice. A GST LUT under CGST Rule 96A allows billing without IGST.
| Applies to | Rules involved | Platforms compared | Last verified |
|---|---|---|---|
| Indian digital marketing agencies, freelancers and firms that bill clients located outside India for advertising, paid media, social media, content and other marketing services | FEMA (Export and Import of Goods and Services) Regulations, 2026, RBI A.P. (DIR Series) Circular No. 20 of 2026, FETERS purpose codes, IGST Act s.2(6), s.13(2) and s.16, CGST Rules 46, 89 and 96A | Skydo, Razorpay, Wise Business, PayPal, Payoneer | 6 Oct 2026 |
How do PayPal, Wise and Payoneer compare for digital marketing agencies paid from abroad?
Platforms named in the question are shown alongside the 2 highest payouts among the platforms this site covers, ranked by the INR received on a $5,000 invoice. Fees were checked on 30 Sept 2026.
| Platform | Best for | Fee | FX markup | Settlement | FIRA | RBI PA-CB status | INR on $5,000 | Source |
|---|---|---|---|---|---|---|---|---|
| Skydo | Indian freelancers and exporters receiving mid to large B2B invoices | $19 up to $2,000, $29 to $10,000, 0.3% above + GST | States zero FX margin at live rate | States under 24 hours; FAQ timelines vary by rail | States instant, free FIRA per payment | RBI authorised PA-CB Inward and Outward; on RBI list | ₹4,70,691 | Skydo pricing (checked 6 Oct 2026) |
| Razorpay | Indian businesses and freelancers on Razorpay invoicing foreign clients | 1% per bank transfer (Rs 1,000 flat below Rs 1,00,000) + GST | States 0% markup on MoneySaver at live rate | States 1 day (T+1 after invoice shared) | FIRS within 24 hours of settlement; no charge listed | RBI authorised PA-CB inward and outward, plus PA-O | ₹4,68,343 | Razorpay pricing (checked 6 Oct 2026) |
| Wise Business | Freelancers and small exporters wanting multi-currency local accounts and eFIRC | Calculator: 1.6% + $2 per payment + 18% GST | Mid-market rate; cost is the 1.6% conversion fee | States under 90 minutes in business hours | eFIRC per transfer, 2 USD + 18% GST | States in-principle PA-CB approval; not found on RBI page | ₹4,64,936 | Wise Business pricing (checked 6 Oct 2026) |
| PayPal | Card and PayPal-wallet payments from overseas PayPal buyers | 4.40% + USD 0.30 per international payment; fixed fee varies | 3.0% above PayPal's base rate on conversion | Not confirmed | Free weekly FIRA; custom Rs 100 + 18% GST each | PA-CB in-principle authorisation granted; final not confirmed | ₹4,35,703 | PayPal pricing (checked 6 Oct 2026) |
| Payoneer | Freelancers and sellers paid via marketplaces or Payoneer clients | Conflicting receiving fee: free, fixed or 1%; 3% INR withdrawal | Conflicting: 3% (fee notice) or 1-4% (pricing page) | Conflicting: auto-withdrawn within 24 or 48 hours | Free digital FIRA downloads; within 72 hours per guide | States in-principle PA-CB; not on RBI list (30 Sep 2026) | ₹4,49,575 to ₹4,69,196 (estimate) | Payoneer pricing (checked 6 Oct 2026) |
Which RBI and GST rules apply to digital marketing agencies paid by foreign clients?
A digital marketing agency billing a foreign client is an exporter of services under the FEMA Export and Import Regulations, 2026, in force from 1 October 2026. GST treats the same work as a zero-rated export when all five conditions in IGST Act section 2(6) are met. Under section 16(3) the agency can supply without paying IGST under a bond or LUT and claim a refund of unused input tax credit. These rules apply whichever payment route the client uses.
| Rule | Source | Clause | Plain meaning | Best for |
|---|---|---|---|---|
| Realisation of export value | FEMA Regulations, 2026 | Regulation 5(1)(a) and provisos | The full invoice value must be realised and repatriated within nine months of the invoice date, or twelve months if invoiced or settled in Indian rupees. The AD bank may extend the period. | Agencies whose clients pay late or in instalments |
| Export Declaration Form (EDF) | FEMA Regulations, 2026 | Regulation 3(2), 3(2)(a) and 3(2)(b); 2(1)(f) | An EDF goes to the specified authority within 30 days from the end of the invoice month. For services other than software that authority is the AD bank. One EDF can cover all exports in a month. Exporters of services other than software may instead submit it on or before the date the payment is received. | Agencies sending several foreign invoices each month |
| EDPMS closure for small invoices | FEMA Regulations, 2026 | Regulation 4(2), proviso | For invoices up to ₹10 lakh, the EDPMS entry may be closed on the exporter's declaration that payment was realised. | Agencies on small monthly retainers |
| Export of services test | IGST Act, 2017 | Section 2(6) | Supplier in India, recipient outside India, place of supply outside India, payment in convertible foreign exchange or in rupees where RBI permits, and the two parties are not establishments of the same person. | Every agency that wants to charge zero GST |
| Place of supply | IGST Act, 2017 | Section 13(2) | For services not listed in sub-sections (3) to (13), the place of supply is the location of the recipient of services. | Agencies running campaigns remotely for clients abroad |
| Zero-rated supply under LUT | IGST Act s.16; CGST Rule 96A | Section 16(1)(a) and 16(3); Rule 96A(1)(b) | The bond or LUT in FORM GST RFD-11 is furnished before export. If payment is not received within one year or the FEMA period with any RBI extension, whichever is later, tax and interest fall due 15 days after that. | Agencies that invoice foreign clients without IGST |
| Purpose code reporting | FEMA Regulations, 2026; RBI Circular No. 84 of 2012 | Regulation 18(2); Circular 84 | The AD bank reports foreign trade transactions in FETERS, using a purpose code from the RBI list. | Agencies checking how a receipt is classified |
Which purpose code applies to digital marketing agencies paid by foreign clients?
RBI's advertising purpose code is P1007, described in the FETERS purpose code list as "Advertising, trade fair service". P0804, often quoted for advertising, means "Repair and maintenance of computer and software" and does not describe marketing work. Research and consulting projects sit closer to P1016 and P1006. Confirm the code with your AD bank, and see the P1007 purpose code and purpose code for digital marketing services.
| Code | Official RBI description (verbatim) | Source | Best for |
|---|---|---|---|
| P1007 | Advertising, trade fair service | FETERS purpose codes | Paid media, social media and campaign work sold as advertising or promotion |
| P1016 | Market research and public opinion polling service | FETERS purpose codes | Audience or market research billed as a separate project |
| P1006 | Business and management consultancy and public relations services | FETERS purpose codes | Marketing strategy consulting or PR outreach |
| P0802 | Software consultancy/implementation (other than those covered in SOFTEX form) | FETERS purpose codes | Website, tracking or marketing software implementation work |
| P0804 | Repair and maintenance of computer and software | FETERS purpose codes | Computer and software maintenance; the description does not cover advertising (see P0804 purpose code) |
| P1099 | Other services not included elsewhere | FETERS purpose codes | Services that fit no listed code, after checking with the AD bank |
Which option costs a digital marketing agency least on $500, $2,000 and $5,000?
Each row applies the platform's published fee, FX markup and 18% GST on the fee to the XE mid-market rate for 4 Nov 2026. Platforms without full published pricing are not included.
| Platform and invoice | Fee | FX markup | GST | INR received | Cost | Best for |
|---|---|---|---|---|---|---|
| Skydo, $500 | ₹1,801 | ₹0 | ₹324 | ₹45,268 | 4.48% | Indian freelancers and exporters receiving mid to large B2B invoices |
| Skydo, $2,000 | ₹1,801 | ₹0 | ₹324 | ₹1,87,449 | 1.12% | Indian freelancers and exporters receiving mid to large B2B invoices |
| Skydo, $5,000 | ₹2,749 | ₹0 | ₹495 | ₹4,70,691 | 0.68% | Indian freelancers and exporters receiving mid to large B2B invoices |
| Razorpay, $500 | ₹1,000 | ₹0 | ₹180 | ₹46,214 | 2.49% | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Razorpay, $2,000 | ₹1,896 | ₹0 | ₹341 | ₹1,87,337 | 1.18% | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Razorpay, $5,000 | ₹4,739 | ₹0 | ₹853 | ₹4,68,343 | 1.18% | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Wise Business, $500 | ₹930 | ₹0 | ₹167 | ₹46,296 | 2.32% | Freelancers and small exporters wanting multi-currency local accounts and eFIRC |
| Wise Business, $2,000 | ₹3,162 | ₹0 | ₹569 | ₹1,85,843 | 1.97% | Freelancers and small exporters wanting multi-currency local accounts and eFIRC |
| Wise Business, $5,000 | ₹7,627 | ₹0 | ₹1,373 | ₹4,64,936 | 1.90% | Freelancers and small exporters wanting multi-currency local accounts and eFIRC |
| PayPal, $500 | ₹2,114 | ₹1,358 | ₹380 | ₹43,541 | 8.13% | Card and PayPal-wallet payments from overseas PayPal buyers |
| PayPal, $2,000 | ₹8,370 | ₹5,436 | ₹1,507 | ₹1,74,262 | 8.08% | Card and PayPal-wallet payments from overseas PayPal buyers |
| PayPal, $5,000 | ₹20,882 | ₹13,592 | ₹3,759 | ₹4,35,703 | 8.07% | Card and PayPal-wallet payments from overseas PayPal buyers |
For example, on a $2,000 invoice Skydo pays about ₹1,87,449 and PayPal about ₹1,74,262 at today's reference rate, a difference of ₹13,187.
What documents follow each digital marketing agency payment from abroad (FIRA, e-BRC, EDF, LUT)?
Each foreign payment to a digital marketing agency needs records that prove the export for both FEMA and GST. The LUT comes before the first invoice, each invoice carries the export endorsement in CGST Rule 46, and the EDF follows within 30 days of the invoice month end. A bank certificate and an e-BRC then confirm the money arrived, and CGST Rule 89(2)(c) asks for BRCs or FIRCs in a refund claim for export of services.
| Document | Who issues it | When needed | Best for |
|---|---|---|---|
| LUT (FORM GST RFD-11) | The agency files it on the GST portal under Services, User Services, Furnish Letter of Undertaking | Before export, for the financial year selected (Rule 96A(1)) | GST-registered agencies billing without IGST |
| Export invoice with endorsement | The agency | On every export invoice, endorsed "supply meant for export ... under bond or letter of undertaking without payment of integrated tax" (Rule 46) | All GST-registered agencies |
| EDF | The agency submits it to the specified authority. That is the AD bank for services other than software, and the AD bank or STPI for software, which Regulation 2(1)(e) defines to include designs and audio or video signals | Within 30 days from the end of the invoice month (Regulation 3(2)) | Agencies invoicing from 1 October 2026; check with the AD bank which authority applies to creative deliverables |
| FIRC or FIRA | Rule 89 refers to FIRCs issued by an Authorised Dealer-I bank. Neither the 2026 Regulations nor Rule 89 defines a FIRA, so check with your AD bank or payment service what document it issues. | After each foreign payment is credited | Agencies claiming GST refunds or proving export income; see FIRC vs FIRA vs e-BRC |
| e-BRC | DGFT issues it as confirmation that the exporter received payment, generated against the bank's inward remittance message (DGFT eBRC FAQs) | After the bank reports the inward remittance | Agencies that need DGFT proof of realisation; see what is an e-BRC |
| EDPMS declaration | The agency gives it to the AD bank | For invoices up to ₹10 lakh, to close the EDPMS entry (Regulation 4(2)) | Agencies on small retainers |
What changes in 2026 for digital marketing agencies paid by foreign clients?
In 2026 digital marketing agencies move to a new FEMA export framework and a new income tax law. The FEMA Export and Import Regulations, 2026 apply from 1 October 2026, and RBI Circular No. 20 supersedes the old Master Direction on exports from that date. The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026.
- New framework: From 1 October 2026, Circular No. 20 paragraph 4 supersedes the Master Direction on Export of Goods and Services and the circulars in its Annex. See what changed in the FEMA export rules.
- EDF: Service exporters now file an EDF within 30 days from the end of the invoice month under Regulation 3(2), with one EDF allowed for a whole month. See the EDF form.
- Realisation: Regulation 5(1)(a) sets nine months from the invoice date, or twelve months for rupee invoicing or settlement. See export realisation period.
- Small invoices: EDPMS entries for invoices up to ₹10 lakh can close on the exporter's own declaration under Regulation 4(2).
- Income tax: The Income-tax Act, 1961 was repealed on 1 April 2026. Income from FY 2026-27 onwards falls under the 2025 Act, while earlier tax years stay under the old Act.
How did we verify this?
Every rule is linked to its official source below with the date it was checked. Platform figures come from each platform's own pages; the full method is on the methodology page.
- RBI Notification No. FEMA 23(R)/2026-RB: Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, Regulations 1(2), 2(1)(e), 2(1)(f), 3(2)(a) and (b), 4(2) proviso, 5(1)(a) and provisos, 18(2) (amended up to September 22, 2026) (checked 6 Oct 2026)
- RBI A.P. (DIR Series) Circular No. 20 dated January 16, 2026: Export and Import of Goods and Services, Paragraphs 1 and 4 and Annex (SOFTEX circulars superseded) (checked 6 Oct 2026)
- RBI: FETERS guidelines and purpose code list (Annex to A.P. (DIR Series) Circular No. 84), Receipt purpose codes P0802, P0804, P1006, P1007, P1016, P1099 (checked 6 Oct 2026)
- RBI A.P. (DIR Series) Circular No. 84 dated February 29, 2012: Compilation of R-Returns, Reporting under FETERS, Reporting of foreign exchange transactions with purpose codes (checked 6 Oct 2026)
- IGST Act, 2017, Section 2: Definitions, Section 2(6): export of services (checked 6 Oct 2026)
- IGST Act, 2017, Section 13: Place of supply where supplier or recipient is outside India, Section 13(2) (checked 6 Oct 2026)
- IGST Act, 2017, Section 16: Zero rated supply, Section 16(1)(a) and 16(3) (checked 6 Oct 2026)
- CGST Rules, 2017, Rule 96A: Export of goods or services under bond or Letter of Undertaking, Rule 96A(1) and 96A(1)(b) (checked 6 Oct 2026)
- CGST Rules, 2017, Rule 89: Application for refund, Rule 89(2)(c): BRCs or FIRCs for refund on export of services (checked 6 Oct 2026)
- CGST Rules, 2017, Rule 46: Tax invoice, Proviso on export invoice endorsement (checked 6 Oct 2026)
- GST Portal user manual: Furnishing of Letter of Undertaking (FORM GST RFD-11), Steps 3 and 4: Services > User Services > Furnish Letter of Undertaking (LUT) (checked 6 Oct 2026)
- DGFT FAQs on Self-Generation of eBRC (Version 1.0, March 2024), Q1 (what is eBRC), Q2 (IRM number), Q30 (no eBRC without IRM) (checked 6 Oct 2026)
- Income Tax Department: Objective and scope of the New Act (Income Tax Act 2025 FAQs), FAQ 2 (repeal on 01.04.2026) and FAQ on earlier tax years (checked 6 Oct 2026)
- Skydo homepage (pricing and fee calculator), Know what you pay; calculator showing GST 18% of transaction fee (checked 6 Oct 2026)
- Razorpay MoneySaver Export Account (International Bank Transfers) pricing, Standard Plan: 0% FX markup, 1% fee, FlashLinks 2%, GST applicable, flat fee of INR 1,000 on transactions below INR 1,00,000, setup and AMC INR 0 (checked 6 Oct 2026)
- Wise India: Fees for receiving money (Business), Conversion fee depends on the currency; eFIRC for every transfer; GST 18% of (conversion fee + eFIRC fee); calculator (checked 6 Oct 2026)
- PayPal India Merchant Fees, Receiving international transactions; Currency Conversions (3.0% converting balance and payments received; 4.00% all other cases); Withdrawals Out of PayPal; Dispute Fees; Other Fees (Last Updated 28 March 2024) (checked 6 Oct 2026)
- Payoneer India home (checked 6 Oct 2026)
Frequently asked questions
Is P0804 the RBI purpose code for advertising services exported by a digital marketing agency?
No. RBI's FETERS purpose code list describes P0804 as "Repair and maintenance of computer and software". The advertising code is P1007, "Advertising, trade fair service". If a receipt was reported under the wrong code, ask your AD bank how it handles a correction. See how to correct a wrong purpose code.
Does a digital marketing agency need a GST LUT for export of services receipts through PayPal, Wise or Payoneer in 2026?
A GST-registered agency that wants to bill foreign clients without IGST must furnish an LUT in FORM GST RFD-11 before export under CGST Rule 96A. The payment route does not change this. Without an LUT or bond, IGST is paid on the export. See LUT filing on the GST portal.
Is a FIRC needed for foreign inward remittance to a digital marketing agency under GST refund rules?
For a GST refund on export of services, CGST Rule 89(2)(c) asks for invoices with the related Bank Realisation Certificates or Foreign Inward Remittance Certificates. Rule 89 refers to FIRCs issued by an Authorised Dealer-I bank. Keep a FIRC or FIRA for every receipt as a record of the export income received.
Does SOFTEX still apply to digital marketing agency exports in 2026?
From 1 October 2026, RBI Circular No. 20 supersedes the old Master Direction and the circulars in its Annex, which include SOFTEX circulars. Exports invoiced from that date are declared on an EDF under Regulation 3(2) of the FEMA Regulations, 2026. See SOFTEX form filing.
What is the RBI export realisation deadline for digital marketing agency invoices in 2026?
Under Regulation 5(1)(a) of the FEMA Regulations, 2026, the full invoice value must be realised and repatriated within nine months of the invoice date. The period is twelve months when the export is invoiced or settled in Indian rupees. The AD bank can extend it when the exporter asks.
Is GST zero-rated if a foreign client pays an Indian digital marketing agency in INR?
IGST Act section 2(6) accepts payment in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India. If the other four export conditions are met and RBI permits the rupee payment, the supply can still be an export. For rupee invoicing, realisation runs twelve months under FEMA.
Do digital marketing agencies need a DGFT e-BRC for export of services receipts in 2026?
An e-BRC is DGFT's confirmation that an exporter received payment for goods or services, according to the DGFT eBRC FAQs. It is generated against the bank's inward remittance message. Check whether your GST refund or export scheme claim requires it. See GST on export of services.
Which income tax law applies to digital marketing agency export income in India in 2026?
The Income-tax Act, 1961 was repealed on 1 April 2026 and replaced by the Income-tax Act, 2025. Export income earned from FY 2026-27 is taxed under the new Act. Tax years before 1 April 2026 stay under the 1961 Act, and pending proceedings continue under its transitional provisions.