What is the full form of URP in GST?
The URP Full Form in GST is Unregistered Person. Under the CGST Act, 2017, the URP is defined under Section 2(84) as any person who is not registered under the said Act. There exists, therefore, a chance that the turnover of such a business is below the set threshold by the government for the assessed duration. At present, the limit below which registration for GST does not have to be done is Rs. 20 lakhs (in some states, Rs. 10 lakhs). People or persons whose business is below this threshold, and entities both, are also covered under URP.
Scenarios With URPs
URPs may get involved in many transactions related to the registered GST business. In such a case, the registered business supplies and is liable to pay GST on the outward supply. They shall be required to give a bill with “URP” written in the recipient’s GSTIN field. On the other hand, the URP cannot avail the ITC on the purchase.
Options for Registered Businesses
A registered business purchasing goods from an URP does not pay GST to the supplier. However, the registered business, that is, the recipient, is not entitled to claim input tax credit on such purchases beyond Rs. 5,000. Under the e-way bill system, a document for tracking the movement of goods, URPs also fall under it, provided that URP becomes a part of the supply chain, either as a supplier or a recipient.