Legal process outsourcing firms file the same monthly EDF as any other service exporter: one form per month, one row per invoice, submitted to the AD bank within 30 days from the end of the invoice month. What makes LPOs different is billing detail: hourly time sheets, matter-wise invoices to law firms, and confidentiality clauses that tempt people to write vague descriptions. The EDF needs enough description to match your FIRA without disclosing client secrets.
Key takeaways
- LPO invoices to foreign law firms and corporate legal teams are exports of services and go on the monthly EDF.
- Mode of delivery is usually Internet; most LPO work is delivered through secure platforms or email.
- Purpose code P1004 covers legal services; SAC codes for legal services sit in the 9982 group. Confirm the exact codes.
- Describe the service type without naming confidential matters, for example "document review services, matter ref. 2026-117".
- Matter-wise billing can produce many small invoices; one EDF still covers them all.
Is LPO work an export of services?
An Indian LPO firm that reviews documents, drafts contracts, prepares research memos or manages e-discovery for a client abroad is supplying services to a recipient outside India. Under the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, those invoices must be declared on the EDF.
The usual routing applies. If your unit is outside an SEZ, the EDF goes to your AD bank. If you operate from an SEZ, it goes to the SEZ Development Commissioner instead. Proprietorships, partnerships, LLPs and companies should assume they are covered. Individual lawyers doing occasional work abroad in a personal capacity should note RBI's 7 October 2026 statement that individuals are not required to report, and check with their bank until RBI publishes FAQs.
Typical LPO billing patterns
| Pattern | How it is usually invoiced | EDF treatment |
|---|---|---|
| Hourly document review | Monthly invoice per matter with hours and rate | One row per invoice |
| Fixed-fee contract drafting | Invoice per batch or deliverable | One row per invoice |
| Dedicated team (FTE model) | Monthly invoice per team | One row each month |
| Litigation support surge | Weekly or fortnightly invoices during a review | Each invoice a row in its month's EDF |
| Subscription research service | Monthly or annual fee | One row per invoice; note the period in remarks |
Matter-wise billing can mean 30 or 40 invoices a month for one law-firm client. That is fine. The EDF does not limit rows, and one form per month covers all of them. A spreadsheet export from your billing system makes the Part 2B table quick to build.
Codes: SAC and purpose
SAC. Legal services fall in the 9982 group of the GST services classification (the same broad group as accounting and bookkeeping, 998222). Your CA should confirm the six-digit code that fits each type of work. Litigation support that is mainly technical, such as e-discovery platform hosting, might fall under an IT code like 998315 or 998319.
Purpose code. P1004 is the RBI purpose code for legal services. Ask your foreign client to quote it, or at least to describe the payment as legal services, and check every FIRA your bank issues. Our purpose code finder is a quick reference.
Mismatches here are common. A US law firm's accounts team may describe a payment as "consulting" or "professional fees", and the bank may assign a different code. Spot it early and ask your bank to correct it.
Writing descriptions without breaching confidentiality
Law-firm clients often insist that matter names and party names never leave the engagement. The EDF's description column (1.21 and the description in Part 2B) needs to describe the service, not the case.
Good examples:
- "Document review services, matter ref. 2026-117, October 2026"
- "Contract abstraction, 420 agreements, batch 3"
- "Legal research memoranda, 6 memos"
- "Paralegal support, dedicated team of 4, November 2026"
Avoid party names, deal names or anything your engagement letter treats as confidential. If your bank wants more detail to match a large payment, ask whether a redacted invoice will do.
A worked example
Lexora Legal Support Pvt Ltd, an LPO in Gurugram, invoices two US law firms and a UK corporate legal department. Its December 2026 invoices:
| Invoice | Client | Country | Description | Currency | Amount |
|---|---|---|---|---|---|
| LLS/26-27/301 | Law firm A | USA | Document review, matter ref. A-2219, 610 hours | USD | 21,350 |
| LLS/26-27/302 | Law firm A | USA | Document review, matter ref. A-2240, 118 hours | USD | 4,130 |
| LLS/26-27/303 | Law firm B | USA | Contract abstraction, batch 7 | USD | 9,800 |
| LLS/26-27/304 | Corporate legal team | UK | Paralegal team, December 2026 | GBP | 14,600 |
One EDF covers all four, due by 30 January 2027. Invoice 301 is above ₹10 lakh in rupee terms, so when it is paid, Lexora provides the bank with the invoice, payment evidence and matching instructions. Invoices 302 and 303 are smaller and can go into a periodic ₹10 lakh realisation declaration. Invoice 304 converts to more than ₹10 lakh too, so it follows the evidence route.
Law-firm clients sometimes pay 60 to 90 days after invoice, after their own client pays. That is still well within the nine-month window, but Lexora tracks it per invoice.
GST for LPOs
Export of services is a zero-rated supply if the Section 2(6) IGST Act conditions are met: supplier in India, recipient outside India, place of supply outside India, payment in convertible foreign exchange (or INR where RBI permits), and supplier and recipient not merely establishments of a distinct person. Most LPOs export under an LUT, with the invoice stating "Supply meant for export under LUT without payment of IGST". Our export invoice tool includes that line.
Some LPO arrangements involve an Indian entity working through a foreign affiliate. If the foreign entity is part of the same group, discuss the "distinct person" condition with your CA. The EDF itself does not alter GST or income-tax obligations, and this article is general information, not legal or tax advice.
Records worth keeping
LPO firms already keep detailed time records. For the EDF, link them to the monthly declaration:
- invoice and time sheet for each row
- engagement letter or master services agreement, referenced in the contract column
- FIRA with purpose code for each receipt
- the EDF as filed, with the bank's acknowledgement
- any bank correspondence on matching or purpose codes
Our article on keeping an EDF register has a template.
Frequently asked questions
Do LPO firms need to file the EDF?
Yes. An LPO business exporting legal support services to foreign clients files a monthly EDF with its AD bank, or with the Development Commissioner if it operates from an SEZ. Each invoice is a row in Part 2B.
What purpose code applies to legal process outsourcing?
P1004 is the RBI purpose code for legal services. Technical work such as hosting a review platform may fit an IT code instead. Confirm with your bank and check each FIRA.
How do I describe confidential matters on the EDF?
Describe the service and use an internal matter reference instead of party or case names, such as "document review, matter ref. 2026-117". If the bank needs more to match a payment, ask whether a redacted invoice is acceptable.
Can one EDF include dozens of matter-wise invoices?
Yes. One EDF per month covers all service export invoices to one or more recipients. Each invoice is a separate row, however many there are.
What if a law firm pays several invoices in one transfer?
Send your bank matching instructions listing each invoice covered by the payment. Keep a note in your register so every row can be closed.
Bottom line
For LPOs, the EDF rewards the same discipline you already apply to time records: precise, consistent and confidential. Describe services, not matters, and keep codes aligned across invoice, FIRA and form. Build your monthly declaration with the free EDF form generator.
This guide is general information for Indian businesses, not legal or tax advice. Rules and bank processes change — confirm specifics with your AD bank or chartered accountant.