P0019 Purpose Code: Receipts on account of Sale of non-produced non-financial assets – Non-Government

Purpose code P0019 is used when an Indian company or individual receives money from an overseas buyer for the outright sale of an intangible asset such as a patent, copyright, or trademark.

What is the P0019 purpose code?

Purpose code P0019 covers money received from abroad when an Indian company or individual sells a non-produced non-financial asset, meaning something that was never manufactured. In practice that is intangible property: patents, copyrights, trademarks, and similar rights, along with receipts for the use of natural resources. The word doing the work is sale, since ownership has to actually transfer for this code to apply, and money received for letting someone use an asset you still own is a royalty or licence fee reported under the current account instead. Under RBI FEMA guidelines, this inward payment is classified under Capital Account and reported accordingly.

When to use P0019 purpose code?

Use P0019 when you sell an intangible asset outright to an overseas buyer and ownership passes to them. It is the correct RBI receipt code for the non-government side of these sales, covering companies and individuals alike. The test is whether you still own the asset afterwards: if you do, the money is not a sale receipt and this is not the code.

When to use a different code:

• Use P0017 when the seller is a government body rather than a company or an individual
• Use P0029 when the receipt is a capital transfer such as a guarantee payment or grant rather than a sale of an asset
• Use the matching S-code when you are sending money abroad rather than receiving money

Who typically uses P0019 purpose code

Indian companies and individuals selling intellectual property to overseas buyers, including software companies assigning a codebase or product, patent holders transferring rights, creators assigning copyright, and businesses selling a trademark or brand. It applies whether you sell as an individual, a proprietorship, or a registered company, since the only entity distinction this code makes is government versus non-government.

Examples of transactions covered under P0019 purpose code

• Payment received by an Indian company for assigning a patent to an overseas buyer
• Proceeds from the outright sale of a trademark or brand to a foreign acquirer
• Money received by a creator transferring copyright in a work to an overseas publisher
• Consideration received on assigning ownership of a software codebase to a foreign company

When NOT to use P0019 purpose code

• The seller is a government body rather than a company or an individual (use P0017)
• The money is a royalty or licence fee for someone using the asset while you keep ownership (use the royalties and licence fees codes)
• You are selling copies of a software product rather than transferring ownership of the underlying rights (use P0807)
• You are sending money abroad rather than receiving (use the matching S-code)

Documents required for P0019 purpose code

To receive a payment under P0019, keep the following documents ready so your bank can verify the transaction and report it correctly under FEMA.

How is a P0019 Purpose Code declared?

Declaring the code is pretty straightforward. Here's how the payment gets tagged and reported.

1. Execute the assignment: Sign the agreement transferring ownership of the asset to the overseas buyer.
2. Receive the payment: The buyer remits the consideration into your Indian bank account.
3. Declare the purpose: State the purpose of the inward remittance on your bank's form.
4. Submit supporting documents: Provide the assignment agreement, proof of ownership, and KYC so the bank can verify the transaction.
5. Get your FIRA: Once processed, your FIRA is issued as proof and the payment is reported under FEMA.

Common mistakes to avoid while using P0019 purpose code

A few common slips can hold up your payment or cause compliance issues. Here's what to watch for.

1. Coding a licence as a sale: Using P0019 for royalty or licence income, when the capital account codes apply only where ownership actually transfers to the buyer.
2. Reaching for the government code: Using P0017 because it appears first in the list, when non-government sellers use P0019 and some abbreviated code lists describe P0017 in a way that invites this error.
3. Code and document mismatch: The code not matching what your assignment agreement describes, which flags the payment.
4. Incomplete documents: Missing the assignment agreement, proof of ownership, or KYC, so the bank holds funds until provided.
5. Missing PAN or KYC: Incomplete verification stops the bank from releasing the payment.
6. Using an inward code for an outward payment: Applying a receipt code to money you're sending out instead of the matching outward code.

How Skydo helps you receive international business payments

P0019 covers capital account transactions, which Skydo does not process. If you also invoice foreign clients for goods or services, here is how Skydo helps you get paid.

1. Complete onboarding: Share PAN, Aadhaar, and Indian bank details. Setup is fully online.
2. Get virtual account details: Receive account details in USD, GBP, EUR and other currencies your clients pay in.
3. Your client pays like a local: They send a domestic transfer in their own country, no SWIFT and no wire fee on their end.
4. FIRA is generated automatically: Free e-FIRA on every payment, stored in your dashboard for GST and audits.
5. INR settles within 24 hours: Mid-market rate with a flat, visible fee, no FX markup.