Receive Money From Abroad in India: FIRA, Codes, Fees
How to receive money from abroad in India as a freelancer or exporter: bank wires vs platforms, purpose codes, FIRC and e-FIRA, GST LUT and a fee example.
Quick answer: To receive money from abroad in India, give your foreign client either your bank's SWIFT details or a payment platform account, make sure each payment carries the right RBI purpose code (such as P0802 for software work), and collect a FIRC or e-FIRA as proof. Exporters of services can then treat the sale as zero-rated for GST, usually under an LUT.
Indian freelancers, agencies and consultants now earn a large share of income from clients in the US, UK, Europe and the Gulf. The money side is not hard, but it has more paperwork than a domestic UPI transfer. This guide explains every route to receive money from abroad in India, what purpose codes and inward remittance certificates are, how GST and income tax treat export income, and how to keep fees low. It is general information for India as of October 2026, not tax or legal advice.
What does it mean to receive money from abroad in India?
Any payment that comes from outside India in foreign currency is an inward remittance under the Foreign Exchange Management Act (FEMA). Your bank, an Authorised Dealer (AD) bank licensed by the Reserve Bank of India, converts it to rupees and credits your account. Because it is a cross-border transaction, the bank needs to know why the money arrived. That reason is recorded as a purpose code, and the bank's confirmation becomes your proof of export.
For a freelancer this matters for three reasons:
- GST: export of services is zero-rated only if the payment is received in convertible foreign exchange (or in rupees where RBI permits) and the other export conditions are met.
- Income tax: the foreign income is taxable in India for residents, and the remittance records support what you report.
- Banking: unexplained inward remittances can be held until you confirm the purpose, which delays your money.
How can freelancers receive money from abroad? The main options
There are two broad routes: a direct SWIFT wire to your Indian bank, or a payment platform that collects money abroad and pays out to your bank in rupees. Many freelancers use both, depending on the client.
| Method | How it works | Typical costs | Best for |
|---|---|---|---|
| SWIFT wire to your bank | Client sends from their bank using your SWIFT/BIC and account number | Sender fee, possible intermediary fee, your bank's FX margin and handling charge | Large invoices, corporate clients that only pay by wire |
| Wise Business | Client pays local account details (for example, a US ACH account); Wise converts and pays to India | Published conversion fee plus mid-market rate; check current pricing | Clients who prefer domestic transfers in their country |
| Payoneer | Receiving accounts in USD, EUR, GBP and others; withdraw to an Indian bank | Receiving and currency conversion fees vary by method | Marketplace sellers and freelancers on platforms |
| PayPal | Client pays by PayPal or card; funds auto-transfer to your Indian bank | Cross-border and conversion fees, often the most expensive route | Small invoices, clients who insist on PayPal |
| Export-focused platforms (for example, Skydo, Razorpay, Xflow) | Local collection accounts abroad, payout in rupees with e-FIRA | Flat or percentage fee; compare current pricing | Regular exporters who want documents handled |
Fees change frequently, so check each provider's pricing page on the day you decide. Our guides to Wise Business fees, Payoneer fees and PayPal fees break down the current charges, and the Wise vs Payoneer comparison helps if you are choosing between the two.
What are RBI purpose codes and which one should you use?
Purpose codes are short codes from the RBI's list for reporting foreign exchange transactions. Inward remittances use codes that start with P. The code tells the bank and RBI what you were paid for. Getting it right matters because it links the payment to the correct GST and income tax treatment.
| Purpose code | Description | Typical user |
|---|---|---|
| P0802 | Software consultancy and implementation (other than those covered by SOFTEX) | Developers, software consultants, SaaS implementers |
| P0803 | Data base, data processing charges | Data entry, data processing services |
| P1006 | Business and management consultancy and public relations services | Consultants, marketers, PR freelancers |
| P1007 | Advertising, trade fair, market research and public opinion polling | Ad agencies, market researchers |
| P1008 | Research and development services | R&D contractors |
The full list is in the RBI master direction on reporting under FEMA, available on the Reserve Bank of India website. Many banks email you to confirm the purpose before crediting a wire. Platforms usually ask you to select a purpose when you add a client or invoice. If you are not sure which code fits, ask your bank before the money arrives: correcting a code later is possible but slow.
What is a FIRC or e-FIRA and why do you need one?
A Foreign Inward Remittance Certificate (FIRC) is a document from your bank confirming that foreign currency was received, the amount, the remitter, the date, the rupee value and the purpose. Many banks and platforms now issue an electronic Foreign Inward Remittance Advice (e-FIRA) for each payment instead of a paper certificate on request.
Keep one for every foreign receipt. You may need it to:
- Support zero-rated export invoices and any GST refund claim.
- Show the source of funds to your bank, a lender or a visa office.
- Match receipts to invoices when you prepare your income tax return.
- Answer questions if the tax department compares your return with reported foreign remittances.
When choosing a platform, check whether it issues an e-FIRA automatically or only on request, and whether there is an extra fee for it.
How to receive money from abroad in India: step by step
- Pick the receiving route. Decide whether the client will wire directly to your bank or pay through a platform. Corporate clients often prefer wires; small businesses often prefer a local transfer in their own country.
- Collect the right bank details. For a wire you need your account name exactly as the bank holds it, account number, bank name and branch address, and the SWIFT/BIC code. India does not use IBANs; our SWIFT code vs IBAN guide explains what to tell clients who ask for one.
- Set up GST if applicable. If you are registered, file a Letter of Undertaking (LUT) on the GST portal before the financial year starts so you can export without paying IGST. See our LUT under GST guide and the basics of GST registration in India.
- Issue a proper export invoice. Show currency, client name and address abroad, a clear description of services, and, if registered, your GSTIN plus wording such as "Supply meant for export under LUT without payment of IGST". You can make one quickly with our free invoice generator.
- Share the purpose. Ask the client to reference the invoice number in the payment, and tell your bank or platform the purpose code.
- Confirm and convert. Reply quickly to any bank email asking for purpose details. Note the exchange rate and any charges deducted.
- Download the FIRC or e-FIRA. Save it with the invoice in the same folder or accounting record.
- Book the receipt. Record the rupee amount, fees and any exchange difference in your books, and include the income in your advance tax estimates.
How are foreign payments taxed: GST and income tax
GST on export of services
Under the IGST Act, a supply is an export of services 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 rupees where RBI permits), and the two parties are not merely establishments of the same person. Exports are zero-rated. If you are registered, you either export under LUT without charging IGST, or pay IGST and claim a refund. Most freelancers use the LUT route. Official guidance is on the GST portal.
Income tax
Resident freelancers pay income tax on worldwide income. Many professionals use presumptive taxation, where a set share of receipts is treated as income if conditions are met; our Section 44ADA guide for freelancers explains the limits, and the ITR for freelancers guide covers which form to file. The new Income-tax Act, 2025 applies from 1 April 2026, so section numbers are changing; see our explainer on the Income-tax Act 2025. If a foreign client asks for a W-8BEN, read our W-8BEN guide for freelancers before signing it.
Worked example: what actually lands in your account
Priya, a web developer in Pune, invoices a US client $2,000 for a website build. The following figures are illustrative to show how costs stack up; actual fees and rates vary by provider and day.
| Item | SWIFT wire | Platform with local USD account |
|---|---|---|
| Invoice amount | $2,000.00 | $2,000.00 |
| Intermediary bank deduction | -$15.00 | $0.00 |
| Amount converted | $1,985.00 | $2,000.00 |
| Exchange rate applied (mid-market assumed at Rs 88.00) | Rs 87.20 (about 0.9% margin) | Rs 88.00 |
| Rupee value | Rs 1,73,092 | Rs 1,76,000 |
| Bank or platform fee (illustrative) | Rs 500 + 18% GST = Rs 590 | 0.5% = Rs 880 + 18% GST = Rs 1,038 |
| Net credited | Rs 1,72,502 | Rs 1,74,962 |
The difference is about Rs 2,460 on one invoice, almost entirely from the exchange rate margin and the intermediary deduction. Over a year of monthly invoices that gap is real money. Always compare the net rupee amount, not the headline fee. Our guide to cross-border payment fees explains each layer in more detail.
Common mistakes when receiving foreign payments
- Wrong or missing purpose code. A payment for software work coded as a family remittance creates problems for GST zero-rating and invites questions.
- Name mismatch. If the client types a shortened name, the bank may hold or return the wire. Send your name exactly as it appears on the account.
- No LUT on file. Registered exporters who forget the LUT may technically owe IGST on export invoices.
- Ignoring short receipts. If $15 goes missing, record it as a bank charge so your receivables match.
- Not keeping e-FIRAs. Downloading them months later from a platform you have stopped using can be hard.
- Using personal transfer services for business. Personal remittance apps may code income as gifts or family support. Use business accounts for business income.
- Vague invoices. "Services" is not enough. Describe the work so the purpose code and place of supply are clear; see our guide to invoicing international clients.
Checklist before your first foreign invoice
- Bank account that accepts inward remittances, with SWIFT code confirmed by your branch
- At least one platform account verified (KYC complete) as a backup option
- Purpose code agreed for your type of work
- GST registration status checked; LUT filed if registered
- Export invoice template with currency, client address abroad and LUT wording
- Folder or system to store invoices with matching e-FIRAs
- Advance tax reminders set; see advance tax due dates
Receiving money from abroad in India is routine once you set up the route, the purpose code and your records. Create clean export invoices in USD, EUR or GBP with our free invoice generator: it needs no sign-up and downloads a PDF built in your browser, so you can send it to your client in minutes.
Frequently asked questions
Is money received from foreign clients taxable in India?
Yes. If you are a resident of India, payments from foreign clients for your services are part of your taxable income, whether they arrive by wire, PayPal, Wise or another platform. Freelancers usually report them as business or professional income, and many use presumptive taxation for professionals if they qualify. Export of services is zero-rated for GST, but that does not make the income tax-free.
What is the difference between FIRC and FIRA?
FIRC is the Foreign Inward Remittance Certificate that banks traditionally issued on request as proof that foreign currency came into India for a stated purpose. FIRA, often called e-FIRA, is the advice many banks and payment platforms now issue digitally for each inward remittance. Both serve the same practical purpose: evidence of the amount, sender, date and purpose code for your GST and income tax records.
Do I need GST registration to receive foreign payments?
Not automatically. Service providers generally need to register once aggregate turnover crosses the GST threshold, which is Rs 20 lakh for most states. Exporters below that limit are often not required to register, but some choose to so they can claim input tax credit or meet platform requirements. Check the current rules on the GST portal or with a chartered accountant for your situation.
Which purpose code should a freelance web developer use?
Software and website work is commonly reported under P0802, software consultancy and implementation, unless the work is covered by a SOFTEX form. A marketing or management consultant might use P1006, and other services have their own codes in the RBI list. The correct code depends on what you actually supplied, so confirm with your bank before the payment is processed rather than after.
How long does an international wire take to reach an Indian bank account?
A SWIFT wire usually takes one to five business days, depending on the sending bank, any intermediary banks, time zones and whether your bank needs purpose code details before crediting the funds. Platform transfers that pay out through local rails are often faster once the money is in the platform. Delays usually come from missing purpose information or a name mismatch.
Can I receive foreign payments in a savings account?
Many banks allow inward remittances into savings accounts, and plenty of individual freelancers use one. However, if you run regular export business, a current account or a dedicated account for business receipts makes bookkeeping and compliance easier. Banks may ask for extra documents for business-type receipts in a savings account, so ask your branch what it requires.
Why did I receive less than the invoice amount?
Short receipts usually come from three places: the sender's bank charging its fee, an intermediary bank deducting a correspondent fee, and the exchange rate margin applied when converting to rupees. Your own bank may also charge a handling fee. Asking the client to choose the OUR charge option on a wire, or using a platform with a transparent rate, reduces the gap.
Can a foreign client pay me through UPI?
UPI is mainly a domestic system, though cross-border UPI links are expanding for some corridors and mainly for person-to-person use. For business payments from foreign clients, bank wires and payment platforms remain the common routes because they produce the inward remittance documentation and purpose codes you need for export compliance. Check whether your provider supports your specific corridor before relying on it.
Should I invoice foreign clients in USD or INR?
Most freelancers invoice in the client's currency, often USD, EUR or GBP, because it is simpler for the client and matches the payment. For GST zero-rating, the payment generally needs to be received in convertible foreign exchange or in Indian rupees where RBI permits. Record the rupee value at the applicable exchange rate in your books and keep the e-FIRA as support.
Invoice Creator Editorial Team
Guides on invoicing, cash flow and small-business finance from Invoice Creator, operated by Next Software Development Company. Content is reviewed for accuracy against the fields our own invoice generator produces.
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