URD Purchase

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This query is : Resolved

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This discussion clarifies the Goods and Services Tax (GST) implications when a registered trader purchases goods from an unregistered person (URD). The key takeaway is that while you don't pay GST on the purchase from the URD, you will be liable to pay GST on the full selling price when you eventually sell the goods. There is no input tax credit available for purchases made from unregistered dealers.

sankar ponnan

sankar ponnan (Querist)
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05 April 2021 SIR- I am a trader registered under GST. I plan to buy a material from Unregistered Person for Rs.43,800/-. Actually, He had purchased that material in the last year with gst invoice (18%) for his own use and he had paid Rs.41,570/- including GST Rs.6,342/-. Now he is ready to sell it with some margin i.e Rs.41,570 + 2500 = Rs. 43,570/-.

In case if I buy it, Should I pay GST on Rs.43,800/- (i.e) Rs. 7,884/- at the time of my sale?

Clear My doubts plz
Thanks in adv

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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05 April 2021 You need to pay GST on your entire selling price. No need to pay any GST on your purchases from URD.

CA Puja Sharma

CA Puja Sharma (Expert)
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05 April 2021 Yes, you will be paying GST at the Time of Sale on your selling price.
Further, no need top pay any GST on the purchase made from unregistered dealer under reverse charge.

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