GST Cancellation

GST registration can be cancelled voluntarily if the business is dormant or does not have the necessary turnover, or by a GST officer if the business is non-compliant. Once the registration is cancelled, the person or entity is no longer required to file GST returns or pay or collect GST.

Voluntary GST Cancellation

It is a process where a person or entity with GST registration wishes to cancel their registration. This can be done by submitting a cancellation request to the GST Department in Form GST REG-16.The GST Officer will issue an order to terminate GST registration in Form GST REG-19 if the application is satisfied.

   The following are some of the most common reasons for voluntary GST registration cancellation:

   Discontinuance or closure of a business.

   Transfer of business, amalgamation, merger, de-merger, lease, or other pertinent reasons.

   Change in constitution of business.

   Decrease in turnover.

   Death of the sole proprietor.

Cancellation by GST Officer

Officers can cancel GST registrations if they have justification, and the proceedings for GST Cancellation by Officer will begin by issuing a show-cause notice in Form GST REG-17.

 A GST officer can start the cancellation process if any of the following events occur.

     if a taxpayer has repeatedly neglected to submit GST filings.

    A voluntary GST registration was made by an assessee, but no business was launched during the allotted six months.

   The GST Act or its Regulations have been violated by the registered taxpayer in one or more instances.

   Deception or willful misrepresentation is used to get the GST registration.

The GST Officer will inform the taxpayer whose GST registration is subject to termination before cancellation in the event that the GST Officer decides to cancel. Before cancelling their GST registration, the taxpayer would first be given a fair chance to be heard.

The notification from the GST Officer to the taxpayer would be delivered in Form GST REG-17 and would include detailed justifications for why the GST registration should be cancelled. If a hearing is planned, the notification would also provide a date and time for the taxpayer to reply and provide any information.

If the taxpayer replies to the notification and the appropriate authority is pleased with the response, he or she may dismiss the matter and issue an order in Form GST REG-20. If he is not satisfied, he may issue a Form GST REG-19 order to revoke the GST registration.

Procedure for GST Registration Cancellation

The GST registration can be online cancelled with IndiaFilings’ assistance. The taxpayer is required to submit all past-due GST returns prior to starting the procedure. The late return must be filed before the GST cancellation procedure may start if the GSTR-3B, GSTR-1, or GST annual return were not submitted on time.

Step 1: Complete the Form GST REG-16 on the common GST site to submit a request for a cancellation of the Tax. The application for GST cancellation must contain the details listed below.

Address for contact, along with a phone number and email.
Cause of cancellation.
When cancellation is preferred.
Information on the price and taxes that must be paid on the stock of raw materials, the stock of semi-finished goods, the stock of finished goods, the stock of capital goods/plant and machinery, and the stock of raw materials.
The taxpayer files the relevant ARN and the details of the most recent GST return.

Step 2: The GST Officer must assess the application and, within 30 days of the application’s date, issue an order cancellation in the Form GST REG-19. The Officer will inform the taxable individual of the cancellation, which will take effect on a date of his choosing.

If you want to cancel a GST registration, speak with an IndiaFilings GST Specialist. We’ll verify if your GST returns have been filed, help you submit any unfinished GST filings, and apply for Tax cancellation.

In addition, when you have filed your application, we will keep an eye on it, respond to any inquiries, and help you finish the procedure.

Final Return

When a GST registration is cancelled, the individual or business must submit a final GST return using Form GSTR-10 within three months of the cancellation date, which is the earlier of the cancellation order’s date or the cancellation date.

This is carried out to ensure that the taxpayer has no unpaid GST obligations. Input service distributors and non-resident taxpayers who are required to pay tax under Sections 10, 51, or 52 are exempt from this provision.

The taxpayer will get a notice in Form GSTR-3A instructing them to submit the final GST return in Form GSTR-10 within 15 days of the notice’s issuance if they fail to do so.

If the taxpayer disregards the notification, actions will be taken to ascertain the taxpayer’s responsibility using the information the relevant Officer has at hand. If the applicant submits the return within 30 days of receiving the notice, the assessment order will be cancelled.

Preparing to Cancel GST Registration

The applicant is required to settle any outstanding GST obligations before beginning the cancellation of GST process. Moreover, the taxpayer is required to pay either the output tax burden associated with the input tax included in the stock of inputs, semi-finished products, completed goods, and capital goods, depending on which is greater.

Although the taxpayer will no longer be qualified to claim ITC if the GST registration is revoked, the input tax credit on the present stock must be reimbursed.

The final GST payment can be made via the GST electronic credit or cash ledger. Making the last payment and filing the last GSTR-10 report simultaneously is an option.

Rejection of application for GST cancellation

For the reasons listed below, the relevant Officer may choose in some cases to refuse the application.

     The application you submitted isn’t complete.

     The new organisation has not registered with the tax authority prior to applying in the transfer, merger, or amalgamation of businesses.

In such cases, the responsible Officer notifies the applicant in writing of the nature of the disagreement. Within seven days after the date of receipt of the letter, the applicant must reply to the same. He may deny the application after giving the applicant an opportunity to be heard if they don’t follow the same procedure.

Revocation of GST Cancellation

Revocation of a GST cancellation signifies that the cancellation decision has been overturned and that the registration is still in effect. This only applies when a tax official decides to cancel a taxable person’s registration. A taxpayer may request the cancellation order be revoked after thirty days of receiving it. The procedures to file for reversal of GST cancellation.

A request for reversal of cancellation in form GST REG-21 may be submitted within 30 days following the cancellation order if a registered person’s registration has been revoked suo-motto by the appropriate Officer.

If the GST Officer is satisfied, he or she may, within 30 days after receiving the application, revoke the cancellation of registration by issuing an order in form GST REG-22. Revocation or cancellation of registration must be justified in writing.

Moreover, the Officer has the authority to make an order in form GST REG-05 denying the application for revocation and notifying the applicant. Nonetheless, the Officer is required to give the applicant a show-cause notice in GST REG-23 before rejecting an application, requesting them to provide justification. After receiving the notification, the applicant has seven business days to reply in form GST REG-24. Once the applicant’s explanation in form GST REG-24 has been received, the relevant authority will make a decision within 30 days.

Benefits of Voluntary GST Cancellation

The taxpayer must start the GST cancellation process as described if there is no commercial activity after obtaining GST registration. The same PAN cannot be used to apply for a new GST registration if a taxpayer ceases submitting GST returns and lets his GST registration lapse.

In addition, if the government cancels a GST registration, the taxable person must pay any late fines and submit an application to have the cancellation reversed. After the restoration, properly terminate the GST or keep submitting GST returns.

As a result, after receiving a GST registration, the taxpayer is required to monitor compliance. Apply for GST registration cancellation as soon as feasible if there is no business activity.