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What Purpose Code Should I Choose in PayPal If I am Freelance Developer in India?

What is Purpose Code?

Purpose code helps regulators in identifying the exact nature of a cross-border transaction. It is required for any cross-border transaction in India.

paypal purpose code

PayPal can’t be used for payment within India and is associated for payment from abroad. So specifying a purpose code is a must for all transactions in PayPal and so PayPal has made it mandatory to provide a purpose code.

Purpose code in PayPal is a one-off selection and it remains stored and is used as a default purpose code for all your transactions until you need to a different Purpose code.

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What Are Options for Purpose Code in PayPal?

PayPal offers the following Purpose code options for us to select.

What Purpose Code to Choose?

Some of the options in PayPal purpose code looks overlapping and so I will help you make the right choice of purpose code for you.

The choice of purpose code will be based on where you get most of your PayPal payments from. For me software consulting is perfect because most of my PayPal payments comes from my web development and consulting clients.

Yes, I do get some payments are from advertising revenue of my websites but most of my payment is from my clients for web development and consulting. So my purpose code is Software consulting under Information Technology.

Software consulting will be the best-suited purpose code for all freelance developers.

Cross border delivery of goods and services can also be true for developers where developer is delivering his or her services overseas but if you look the category of the purpose code in bold, it is under Export of Goods which I don’t see as the right category for developers and so I avoid it as purpose code for my services.

If you are a writer and if your clients pay you for writing, your purpose code should be Other information services under Content and Journalism because the broad category of content and journalism best suits what you offer.

Remember the choice of purpose code is to allow regulators to identify the nature of a transaction.

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  • Aniket Sen

    Hello, I want to use paypal for accepting payment from online survey panel. What should be the correct purpose code for me?

    • Depends on your clients or on the purpose of the survey and if you are doing the survey for some data processing, you can opt for data processing consulting as well.

  • Sonia

    What purpose code I should select as a blogger and I have some direct advertiser who pay me in my PayPal?

    • Advertising and market research suits more than anything else for bloggers with advertising income.

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