GST Cancellation: Documents, Fee and Process

You can cancel your GST registration if the GST rules don’t apply to you or you are shutting down your business or profession, or the tax officer calls for cancellation. Are you a business owner in India looking to cancel your GST registration? Contact our Tax Experts to learn more about GST Cancellation.

GST Surrender fee

3499 2499/-
  • Application for GST Registration Cancellation
  • Final Return filing

What Is GST Cancellation ?

Cancellation of GST registration simply means that the taxpayer will not be a GST registered person anymore. He will not have to pay or collect GST or claim the input tax credit and accordingly, need not file GST returns.

Once GST Registration will get cancelled following will be consequences

  • The taxpayer will not pay GST anymore
  • For certain businesses, registration under GST is mandatory. If the GST registration is cancelled and business is still continued, it will mean an offence under GST and heavy penalties will apply.
GST Cancellation - Closing Chapters, Opening New Paths, GST Registration for partnership firm

Reasons for GST Cancellation

GST authorities may initiate the termination of a taxpayer’s GST registration for a variety of reasons. Among the most common explanations are:

  1. Non – compliance: If a taxpayer fails to comply with GST requirements, such as failing to file returns for an extended period of time, authorities have the authority to terminate their registration.
  2. Business Discontinuation: When a company closes or is sold, the GST registration becomes obsolete and is subject to cancellation.
  3. Changes in Business Structure: Certain changes in business structure, such as amalgamation, demerger, or ownership change, may result in GST cancellation.
  4. Voluntary Cancellation: Taxpayers who no longer wish to continue their GST registration may request for voluntary cancellation.

GST Cancellation Fees

3499 2499/-
  • Application for GST Registration Cancellation
  • Final Return filing

Documents Required For GST Cancellation

The following documents are required for GST Cancellation:

  • User ID and Password of GST Registration 
  • A copy of the GST registration certificate.
  • A copy of the PAN card of the registered person.
  • Details of the tax paid on such inputs, semi-finished, finished goods held in stock on the date of cancellation.
  • Application for Cancellation of Registration in Form GST REG-16.
  • Detail of Last Return filled by Taxpayer

GST Cancellation Process

Step 1: Gather Your Documents:

Before you can cancel your GST registration, you will need to gather the following documents:

  1. Your GST registration number
  2. Your GST login credentials
  3. Your GST returns and payment records
  4. Your business closure or transfer documents (if applicable)

Step 2: Log in to the GST Portal:

Log in to the GST portal using your GST login credentials.

Step 3: Navigate to the Cancellation Form:

Once you are logged in, navigate to the GST registration cancellation form.

Step 4: Fill Out the Cancellation Form:

Fill out the GST registration cancellation form, providing all the necessary information, including your reason for cancelling your GST registration.

Step 5: Submit the Form:

Once you have filled out the form, submit it electronically.

Step 6: Wait for Confirmation:

You will receive a confirmation of your GST registration cancellation via email or SMS. The cancellation will take effect from the date you specified in the form.

GST Final Return Filing

A GST Final Return is a return that must be made by a registered individual when their GST registration is cancelled. A registered individual who cancels their GST registration must file a final return within three months of the cancellation date. This return will include information on all supplies made and received during the registration period, as well as the tax liability and input tax credit claimed.

The GST Final Return is a summary of all transactions that occurred during the registration period, including information on all taxable supplies, exempt supplies, and non-GST supplies. It also includes information on all input tax credits claimed as well as any outstanding tax liabilities. Even if no transactions occurred throughout the reporting period, the Final Return must be filed.
Once the Final Return is filed, the GST officer will review it and may request further information if necessary. If the officer is pleased with the return, he will issue a Form GST REG-06 acknowledgement. The GST Final Return acts as the registered person’s account closure with the GST administration.

It is vital to note that if a registered person fails to file the GST Final Return within the stipulated time limit, they would be fined Rs. 100 per day, up to a maximum of 0.25% of their sales in the state or union territory. Therefore,

Important Considerations

Before proceeding with GST cancellation in India, consider the following:

  1. Outstanding Dues: Ensure that all outstanding dues are cleared before applying for cancellation to avoid any issues.
  2. Input Tax Credit: Make sure to utilize any remaining input tax credit before cancellation, as it will be forfeited post-cancellation.
  3. Legal Implications: Understand the legal implications of GST cancellation, including penalties for non-compliance.

Do you want to Apply for GST Cancellation?

If you have any doubts or questions regarding GST cancellation, consult with a tax professional for guidance.

Call: +91 9818209246

FAQs On GST Cancellation

Can GST be Cancelled automatically?

GST registrations cannot be terminated unless returns are filed. First, taxpayers must file their GST returns. The taxpayer must next file form GSTR-10 (commonly known as the Final Return) to request termination of GST registration.

What is the time limit for GST cancellation?

Taxpayer must submit it to the Common Portal within 30 days of the date of service of the cancellation order. If the proper official is satisfied, he may rescind the cancellation of registration by issuing an order in form GST REG-22 within 30 days of the application’s receipt.

What happens if GST gets Cancelled?

When a GST registration is cancelled, the taxpayer is no longer a registered person under GST and is no longer required to pay/collect GST, claim an input tax credit, or file return

Is there any fee for GST Cancellation?

No, there is no Govt Fee but there may be Professional Fee of CA or Person who is filing your GST cancellation Application.

What are the benefits of cancelling GST?

Some of the potential benefits of cancelling GST include:

  • Increased simplicity and ease of compliance for businesses.
  • Reduced compliance costs for businesses.
  • Increased transparency for businesses and consumers.
  • Reduced tax evasion.
What are the drawbacks of cancelling GST?

Some of the potential drawbacks of cancelling GST include:

  • Increased complexity and difficulty of compliance for businesses.
  • Increased compliance costs for businesses.
  • Reduced transparency for businesses and consumers.
  • Increased tax avoidance.
What is the process for cancelling GST?

The process for cancelling GST is not yet clear. However, it is likely that businesses would need to file an application with the government to cancel their registration. The government would then review the application and make a decision.

Can a taxpayer reapply for GST registration after cancellation?

Yes, a taxpayer can reapply for GST registration after cancellation if they meet the eligibility criteria for GST registration.

How long does it take for GST Cancellation to be approved?

The authorities usually approve GST Cancellation within seven working days from the date of submission of the application.

Can a taxpayer voluntarily cancel their GST registration?

Yes, a taxpayer can voluntarily cancel their GST registration if they fulfill the conditions for cancellation.

Can I cancel my GST registration if my turnover is still above the threshold?

Yes, you can voluntarily cancel your GST registration even if your turnover is still above the threshold.

Can I surrender my GST number?

A registered person or individual with a GST Registration can relinquish GSTIN by filing a GSTR-10 return, which is known as a Final Return. The majority of companies and individuals who provide goods and services in India have a GST Registration Number.

What is suo moto cancellation?

Suo moto revocation of GST registration demonstrates that the assessee is not a GST-registered individual, and his GSTIN would be rendered inactive. According to it, the assessee could not furnish the taxes, claim the ITC, or even recognize doing business without the GSTIN, which carries significantly harsher penalties.