Digital transformation has been prioritized in the railway industry to bring automation to railway operations. Digital Twin (DT) technology has recently gained attention in the railway industry to fulfill this goal. Contemporary researchers argue that DT can be advantageous in Railway manufacturing logistics to planning and scheduling. Although underlying technologies of DT, e.g., modelling, computer vision, and the Internet of Things, have been studied for various railway industry applications, the DT has been least explored in the context of railways. Thus, in this paper, we aim to understand the state-of-the-art of DT for railway (DTR), for advanced railway systems. Besides, this survey clarifies how DT can serve the railway twin system designers and developers. As DTR is still in its early adoption stage, there is hardly any clear direction to identify the technologies for specific DTR applications. Therefore, based on our findings we present a taxonomy for DTR for designers and developers. Finally, we describe potential challenges, pitfalls, and opportunities in DTR for future researchers.