S0806 Purpose Code: Other information services, Subscription to newspapers, periodicals

Purpose code S0806 is used when an Indian business pays a foreign vendor for information services or subscriptions to overseas newspapers and periodicals.

What is the S0806 purpose code?

Purpose code S0806 is used when an Indian business sends money abroad to pay for information services or subscriptions to foreign newspapers, journals, magazines and periodicals. This covers ongoing or one-time access fees for international publications and information platforms, including print and digital subscriptions purchased from outside India. It generally applies to information content and subscription services, not to unrelated software or hardware services that fall under other specific service codes. Under RBI FEMA guidelines, this outward payment is classified under telecommunication, computer and information services and reported accordingly.

When to use S0806 purpose code?

Use S0806 when you are paying an overseas publisher or information service provider for access to newspapers, journals, periodicals or similar information content for your business in India. It is the correct RBI purpose code for subscriptions and information services bought from a foreign provider, regardless of your business structure. S0806 covers the information service or subscription, not unrelated IT consulting or hardware services.

When to use a different code:

• Use S0801 when the payment is for hardware consultancy or implementation
• Use S0803 when the payment is for database or data processing charges
• Use the matching P code when you are receiving money rather than paying

Who typically uses S0806 purpose code?

Indian companies, startups, firms and agencies that subscribe to foreign newspapers, journals, magazines or other information services, including digital platforms and professional publications. It applies whether you pay as a private limited company, LLP, partnership or proprietorship, as long as the subscription or information service comes from outside India.

Examples of transactions covered

• Annual subscription payment to an overseas newspaper or financial daily for your office in India
• Subscription fees to a foreign academic or scientific journal publisher for online access
• Monthly charges to an international market intelligence or news service platform
• Renewal of a multi-year subscription to an overseas industry magazine or professional periodical

When NOT to use S0806 purpose code

• The payment is for hardware consultancy or implementation (use S0801)
• The payment is for database or data processing charges (use S0803)
• The payment is for unrelated IT or software services that fall under other specific service codes
• You are receiving money rather than paying (use the matching P code)

Documents required

To send a payment under S0806, keep the following documents ready so your authorised dealer bank can verify the transaction and report it correctly under FEMA.

How is a S0806 Purpose Code declared?

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

1. Receive the vendor invoice: Your overseas publisher or information service provider bills you, clearly describing the subscription or information service and the billing period.
2. Determine taxability: Establish whether the payment is chargeable to tax in India, since that decides which part of Form 145 you file.
3. File Form 145: Submit the declaration before remitting, with Form 146 from your CA where the taxable amount exceeds ₹5 lakh in the Tax Year.
4. Complete Form A2: State the purpose of the outward remittance as S0806 and submit the supporting documents to your bank.
5. Get your MT103: Once the payment is sent, request the SWIFT MT103 as proof and retain your Form A2 record.
6. With a traditional bank you handle each step of the payment journey. But with a platform built for cross-border payments, you can preselect a default purpose code so the payments go out smooth.

Common mistakes to avoid

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

1. Confusing subscription type: Tagging unrelated IT or software services under S0806 when they belong under a different service purpose code.
2. Code and invoice mismatch: The code not matching what your vendor invoice describes, which flags the payment.
3. Assuming a Rule 220(3) exemption: Skipping Form 145 on a payment that is not on the specified list, which carries a ₹1,00,000 penalty per instance.
4. Incomplete documents: Missing invoice, contract or Form A2, so the bank holds the remittance until provided.
5. Missing PAN or KYC: Incomplete verification stops the bank from releasing the payment.
6. Using an outward code for an inward receipt: Applying a payment code to money coming in instead of the matching P code.

How Skydo helps with payments under S0806 Purpose Code

With a bank, you fill a fresh Form A2 and chase documents for every single vendor payment. With Skydo, your outward payments run on the same account you already collect into.

1. One account, both directions: Receive from international clients and pay overseas vendors from a single onboarded account, with one KYC.
2. Purpose code applied consistently: Set S0806 as your default for these payments so every remittance is tagged the same way.
3. Documentation in one place: Your invoices, Form A2 records and payment proofs stay together, ready for your CA and your AD bank.
4. A rate you can see: You get the live mid-market rate with a transparent fee, instead of a markup hidden inside the bank's rate.
5. Payments that go out on schedule: Your vendor gets paid without a branch visit or a week of back and forth.