S1015 Purpose Code: Tax consulting services

Purpose code S1015 is used when an Indian business pays a foreign consultant or firm for tax consulting services.

What is the S1015 purpose code?

Purpose code S1015 is used when an Indian business sends money abroad to pay for tax consulting services provided by an overseas advisor or firm. This includes international tax planning, cross-border structuring advice, foreign tax compliance support, and related professional tax advisory work purchased from outside India. It does not apply to legal services or non-tax consultancy, which fall under their respective RBI service codes. Under RBI FEMA guidelines, this outward payment is classified under other business services and reported accordingly.

When to use S1015 purpose code?

Use S1015 when you are paying an overseas tax consultant, accounting firm or advisory practice for tax-related consulting, planning or compliance support delivered to your business in India. It is the correct RBI purpose code for cross-border tax consulting services bought from a foreign partner, regardless of whether you are a company, firm or proprietorship. S1015 covers tax advisory services only, not unrelated legal, management or technical consulting.

When to use a different code:

• Use the relevant consulting service code when the payment is for non-tax management or business advisory work
• Use the appropriate legal services code when the payment is for legal opinions, drafting or representation rather than tax advice
• Use the matching P code when you are receiving money rather than paying

Who typically uses S1015 purpose code?

Indian companies, startups, LLPs and professional firms that hire overseas tax consultants or international advisory firms for cross-border tax planning and compliance support. It applies whether you pay as a private limited company, LLP, partnership or proprietorship, as long as the tax consulting service is provided from outside India.

Examples of transactions covered

• Professional fees to an overseas tax advisory firm for international tax structuring of your India business group
• Payment to a foreign accounting firm for advice on indirect tax implications of expanding into their jurisdiction
• Retainer fees to an international tax consultant for ongoing cross-border tax planning support
• One-time fee to a foreign specialist for a tax opinion on a proposed overseas transaction or investment

When NOT to use S1015 purpose code

• The payment is for general business or management consulting that is not tax specific (use the appropriate non-tax consulting service code)
• The payment is for legal services such as contract drafting, litigation or regulatory representation (use the relevant legal services code)
• The payment is for technical, engineering or IT consulting rather than tax advice (use the corresponding technical or IT services code)
• You are receiving money rather than paying (use the matching P code)

Documents required

To send a payment under S1015, keep the following documents ready so your authorised dealer bank can verify the transaction and report it correctly under FEMA.

How is a S1015 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 tax consultant or advisory firm bills you, clearly describing the tax consulting work delivered.
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 S1015 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. Mixing tax and non-tax services: Tagging a mixed invoice of tax and non-tax consulting fully under S1015 instead of separating and coding each service correctly.
2. Code and invoice mismatch: Using S1015 when the vendor invoice does not clearly describe tax consulting services, which can flag the payment for extra checks.
3. Assuming a Rule 220(3) exemption: Skipping Form 145 on a payment that is not on the specified exempt list, which carries a ₹1,00,000 penalty per instance.
4. Incomplete documents: Missing invoice, engagement letter 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 S1015 to money coming in instead of the matching P code.

How Skydo helps with payments under S1015 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 S1015 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.