Urd purchases
This query is : Resolved
Subhangi Mhatre
(Querist)
16 October 2013
Dear All,
Our one client purchase BAMBOO from unregistered dealer on that seller didn't charged the VAT on the bill amount. In this regards, my query is, Is purchaser will be liable to pay VAT on such bill amount? If yes, then how much VAT rate which he liable to pay?
Please Reply, Have a nice day...!!!!!!
Our one client purchase BAMBOO from unregistered dealer on that seller didn't charged the VAT on the bill amount. In this regards, my query is, Is purchaser will be liable to pay VAT on such bill amount? If yes, then how much VAT rate which he liable to pay?
Please Reply, Have a nice day...!!!!!!
MJ Krishnamurthy
(Expert)
16 October 2013
At the rate applicable to bamboo in your state.....mjk
Subhangi Mhatre
(Querist)
19 October 2013
Thanks Sir, Can purchaser gets credit of such amount in Vat ?
02 August 2025
Here’s the answer to your query about **URD purchases of bamboo** and VAT liability:
---
### 1. Is the purchaser liable to pay VAT on purchase from unregistered dealer (URD)?
**Yes.**
If the supplier (unregistered dealer) does not charge VAT on the sale (because they are unregistered), then under most VAT laws, **the purchaser is liable to pay VAT on such purchases** under the **reverse charge mechanism** or **URD purchase rules**.
---
### 2. At what rate should VAT be paid?
* The purchaser should pay VAT at the **rate applicable to bamboo** in the respective state.
* For example, if VAT on bamboo is 5%, then VAT on the purchase value from the URD will be calculated at 5%.
---
### 3. Can purchaser claim Input Tax Credit (ITC) on VAT paid on URD purchase?
* **Yes, usually the purchaser can claim input tax credit** on the VAT paid under URD purchase.
* This input credit can be adjusted against VAT liability on sales.
* However, the rules on ITC on URD purchases may vary slightly between states, so it’s good to check the exact provisions under the local VAT act.
---
### Summary:
| Question | Answer |
| ------------------------------- | ------------------------------------------- |
| Is purchaser liable to pay VAT? | Yes, under URD/reverse charge mechanism |
| VAT rate to be applied | Applicable VAT rate on bamboo in your state |
| Input tax credit on VAT paid | Yes, usually allowed to claim ITC |
---
If you want, I can help you with how to record this transaction in your VAT return or calculation examples. Would that be useful?
---
### 1. Is the purchaser liable to pay VAT on purchase from unregistered dealer (URD)?
**Yes.**
If the supplier (unregistered dealer) does not charge VAT on the sale (because they are unregistered), then under most VAT laws, **the purchaser is liable to pay VAT on such purchases** under the **reverse charge mechanism** or **URD purchase rules**.
---
### 2. At what rate should VAT be paid?
* The purchaser should pay VAT at the **rate applicable to bamboo** in the respective state.
* For example, if VAT on bamboo is 5%, then VAT on the purchase value from the URD will be calculated at 5%.
---
### 3. Can purchaser claim Input Tax Credit (ITC) on VAT paid on URD purchase?
* **Yes, usually the purchaser can claim input tax credit** on the VAT paid under URD purchase.
* This input credit can be adjusted against VAT liability on sales.
* However, the rules on ITC on URD purchases may vary slightly between states, so it’s good to check the exact provisions under the local VAT act.
---
### Summary:
| Question | Answer |
| ------------------------------- | ------------------------------------------- |
| Is purchaser liable to pay VAT? | Yes, under URD/reverse charge mechanism |
| VAT rate to be applied | Applicable VAT rate on bamboo in your state |
| Input tax credit on VAT paid | Yes, usually allowed to claim ITC |
---
If you want, I can help you with how to record this transaction in your VAT return or calculation examples. Would that be useful?
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