An unregistered person under GST is any supplier or entity engaged in business who is not registered with the GST network and does not possess a GSTIN, typically because their annual turnover is below the mandatory threshold (e.g., ₹20–40 lakh) or they deal exclusively in exempted goods/services. They cannot charge GST on invoices or claim input tax credit.
Section 2(84) of the CGST Act terms the person who is not registered under the Act as an unregistered person (URP). As an example, persons having an annual turnover less than Rs 20 lakhs are not liable to obtain a GST registration and hence will get classified as an unregistered person.
If you don't register for GST and are required to, you may have to pay GST on sales made since the date you were required to register. This could happen even if you didn't include GST in the price of those sales. You may also have to pay penalties and interest.
Assessment of Unregistered Person
This has to be done for the relevant period for which the tax is unpaid. The officer can issue an assessment order within five years from the date specified under section 44 for furnishing annual returns for the financial year for which taxes are unpaid.
But persons who are engaged exclusively in the business of supplying goods or services or both that are not liable to tax or wholly exempt from tax or an agriculturist, to the extent of supply of produce out of cultivation of land are not liable to register under GST.
GST registration is mandatory for all eCommerce Sellers Citizen can apply for New GST by Registrating online without Visiting the Govt. office.
Businesses dealing in goods are exempt from GST if their annual aggregate turnover is below INR 40 lakhs. For businesses in hilly and northeastern states, this threshold is reduced to INR 20 lakhs to address regional challenges. Service providers are exempt from GST if their turnover is under INR 20 lakhs annually.
Unregistered persons should create a User ID on GST Portal, using which they can create challan and make Payment in pre-login mode. Download the application from “Download -> Offline Tools”, print it, fill it and submit to Jurisdictional Tax Office along with Payment Receipt.
If you buy goods or services from an unregistered person, they will not charge GST. This normally means you cannot claim GST on the purchase. For some special supplies, such as secondhand goods, you may still be able to claim a GST adjustment.
If you're not registered for GST, your invoices should not include the words 'tax invoice' – you must issue standard invoices. We have examples of how tax invoices can look, including what information needs to be included on them – see, Tax invoices.
An unregistered person may supply goods on ordinary commercial invoices and he cannot issue tax invoice.
Unregistered persons can claim refunds if specific conditions are met, such as the expiry of the supplier's credit note issuance period and the submission of necessary documentary evidence. The application must be filed electronically using FORM GST RFD-01, with manual filing allowed in certain scenarios.
Businesses are required to register for GST and pay tax on their annual turnover if their annual revenue exceeds Rs. 40 lakhs in the case of goods supplied and Rs. 20 lakhs for the supply of services.
Any person or entity who is not registered in the GST system but intends to transport or move goods above Rs. 50,000 valuation is eligible to use form ENR-03 for generating an enrolment number. This number is then used to generate e-way bills instead of using recipients' GSTIN.
Create an account. If you are required to register for GST but don't, you will be required to pay GST from the date you were supposed to register. This means you might need to send the ATO payments for GST, even though you didn't collect it in your sales. You may also have to pay penalties and interest.
The applicant should file the refund application using Form GST RFD-01 on the GST portal under the category 'Refund for unregistered person'. Further, they should upload Statement 8 (in PDF format) along with all the requisite documents as per Rule 89(2) of the CGST Rules.
A person is called as an 'unregistered person' if his turnover is less than the limit of aggregate transactions is less than prescribed for registration with GST by a person. A person may not register with GST Department even he crosses the threshold limit required for registration.
Section 23(1) of the CGST Act specifies that the following persons need not take a registration: Any related person,who is only engaged in making exempt supply of goods or services or both under this Act. Any person who is engaged in the business of making only exempt supplies of goods or services or both.
Assessment of Unregistered Persons
He can issue assessment order within 5 years from the due date of the annual return for the year when the tax was not paid. The taxable person will receive a show cause notice and an opportunity of being heard before passing any order.
Any applicant, who is not registered or not liable to be registered under GST Act, can apply for Temporary User ID on the GST Portal. This User ID is only for facilitating certain exclusive functionalities available to unregistered persons at GST Portal.
If you haven't registered for GST
If your GST turnover is under $75,000 and you haven't chosen to register for GST, you don't include GST in your prices. Any invoices you provide need to show that GST was not included. You also can't claim GST credits for your business purchases.
Accordingly, wherever a registered person procures supplies from an unregistered supplier, he need to pay GST on reverse charge basis.
GST exemption from registration
A person whose turnover falls below the threshold exemption limit—INR 40 lakhs for goods, INR 20 lakhs for services, and INR 20 lakhs (or INR 10 lakhs in special category states) for specified categories.
The GST/HST break includes certain qualifying goods, such as:
An offender not paying tax or making short payments must pay a penalty of 10% of the tax amount due subject to a minimum of Rs. 10,000. Consider — in case tax has not been paid or a short payment is made, a minimum penalty of Rs 10,000 has to be paid. The maximum penalty is 10% of the tax unpaid.