GST or Goods and Services Tax has eliminated multiple taxes and has brought all goods and services under a single domestic indirect taxation law for the entire country. The regime mandates businesses over Rs. 20 lakhs in turnover to register for GST. This value is Rs. 10 lakh for states with special status. However, businesses can also opt out of the GST scheme and surrender their GST number. This is known as GST cancellation.
Continue reading to know more about who can file for GST cancellation, how to cancel GST, and more.
A GSTIN number is issued to the taxpayer at the time of GST registration. If the central tax authority or the taxpayer wishes to cancel this number, it is called GST cancellation. The tax officer takes care of cancellations in India. Businesspersons are not allowed to run their business after GST number cancellation. The Income-tax department will levy high penalties if they continue to do so. Once the GSTIN is cancelled, the business would not have to pay or charge GST. This generally indicates a winding down of business or a change in the business constitution.
The Central Tax Authority or a business owner may choose to cancel GST registration for any of the following reasons:
The person is registered under one of the previous tax laws: Some businesses registered under the old tax regime are not liable for GST registration. For instance, the threshold limit for VAT was Rs. 10 lakhs, and that for GST is Rs. 40 lakhs. Thus, people registered under VAT are not liable for GST registration.
Discontinuation of Business: If a business stops operations, the owner can put in an application for cancellation of GST registration. It can also be cancelled in the following cases:
GST cancellation process in India can be initiated by the taxpayer or the tax officer. In case of the death of a taxpayer, the legal heirs can apply for cancellation. The tax officer needs to follow a standard procedure for cancellation of GST registration. This includes sending a show cause to the registered person. The receiver needs to answer the show cause within 7 working days from the date of the GST cancellation order. The failure to respond will lead to GST number cancellation.
The following people can file for cancellation of GST registration in India:
Here are the ways through which you can cancel GST registration:
1. The tax office will send a show-cause notice to the taxpayer using form GST REG-17
2. The registered taxpayer must respond with a reason to stop the GST cancellation process. The response needs to be sent out within 7 days from the date of serving of notice.
3. If the tax officer is satisfied with the response, they will stop the GST registration cancellation process and issue an order using the form GST REG-20
Procedures for cancellation of GST registration are different for migrated taxpayers and those who have filed tax invoices. GST portal allows GST registration cancellation for migrated taxpayers too. These are taxpayers who haven’t issued tax invoices after registration. Taxpayers who have issued invoices will have to fill out form GST REG-16. Here is the detailed GST cancellation process:
Step 1: Use the link www.gst.gov.in to login to the GST portal. Input your login details to access your GST account.
Step 2: Go to the top bar menu on your GST account dashboard. Click ‘service option’ and choose registration on the dropdown. In the next dropdown, select ‘Application for Cancellation of Registration’. The dashboard screen will now show three sections. They are basic details, cancellation details, and verification.
Step 3: Go to the ‘basic details’ section on your dashboard and fill in the requisite details. If you wish to receive future communication at the same address as the principal place of business, check the ‘same as above’ box and click on the ‘save and continue’ button.
Step 4: After saving the basic details, you will see the cancellation details section on the screen.
Step 5: Choose the reason for GST cancellation from 6 options in the dropdown. These reasons include the death of a sole proprietor, cessation of tax liability, PAN change because of change in the business constitution, business discontinuance, business transfer and others.
Step 6: You also need to fill out the following details in the cancellation form: GST cancellation reason, Desired date for GST registration cancellation, Stocks and inputs that attract tax, Details of the latest tax returns filed.
Step 7: Select electronic cash ledger or electronic credit ledger to indicate the stock value and tax liability
Step 8: You must enter the GSTIN of the transferee entity if the existing unit is transferred, merged, or demerged.
Step 9: After you fill in the cancellation form details, the verification section will be the next to appear on the screen. Enter the name of the authorised signatory and the place of declaration.
Step 10: In the following section, you will have to fill details of the authorised signatory. Submit the details after entering the relevant option.
Step 11: Choose between ‘submit to DSC’ and ‘submit to EVC’. It is mandatory for people with a company/LLP to upload the DSC. An OTP is generated after you submit the details in the verification section. Enter the OTP. You will receive an acknowledgement within 15 minutes.
In case of the death of the sole proprietor, the legal successor must file an application for cancellation of GST registration using Form GST REG-16. If the tax officer uses Suo moto for GST cancellation, the taxpayer can apply for revocation of GST cancellation using form GST REG-21 within 31 days from the issue of cancellation order.
You will need to provide the following information to cancel your GST registration:
There are various forms for the cancellation of registration under GST in India. Each of them serves a different purpose. Below are the details of the forms and their purpose:
|FORM GST REG-16||Voluntary cancellation by a registered user|
|FORM GST REG-17||Show-cause notice by the tax officer|
|FORM GST REG-18||Taxpayer’s response to the notice|
|FORM GST REG-19||Dissolution order|
|FORM GST REG-20||To stop the GST cancellation procedure|
|FORM GST REG-21||Application for revocation of cancellation of GST registration|
|FORM GST REG-22||Order for revocation of GST registration cancellation|
Here is the list of documents required for GST cancellation:
The tax that the taxpayer must pay on stock
The GST department issues the final GST return through GST 8 Form. It contains all the relevant information from the date of GST registration to the date of deregistration. Businesses applying for cancellation of registration under GST must pay all outstanding returns and payments. They must also submit the completely filled GST F8 form within 1 month from the accounting period’s end.
The effective date of cancellation refers to the date when the GST registration is cancelled. This date varies based on the situation because some taxpayers also apply for revocation of GST cancellations.
Revocation of cancellation refers to undoing the cancellation of GST registration. It is applicable when the tax officer cancels the GST registration. Taxpayers must apply for revocation within 30 days from the cancellation date. To do this, they must submit an application to the tax authorities. The tax officer makes the final decision of accepting or rejecting the application for revocation.
1. If a tax officer has cancelled GST registration by Suo moto, the taxpayer can apply for revocation using form GST REG-21
2. The registered person must submit the application through the tax portal within 30 days of cancellation
3. The revocation is subject to the approval of the tax officer. The officer can revoke it using form GST REG-22 within 30 days of receiving the application
4. In case the tax officer is not satisfied with the revocation application, they can reject it using form GST REG-05. They then send a show-cause notice and the applicant needs to respond to it within 7 days. The response must include an explanation for why the application should not be rejected
5. Once the tax officer receives the response, they must decide within 30 days of the date of the notice. Form GST REG-24 needs to be used in such cases
If someone registered under the GST scheme cannot do any business after registration, they must proceed to surrender GST registration. If they stop filing returns, the registration will lapse and they will not be able to apply for new GST registration using that PAN. If they cancel it voluntarily, they can apply for fresh GST whenever they want.
Taxpayers can apply for and track GST cancellation online here. They must ensure compliance after they receive registration. In case there is no commercial activity, it is better to apply for the cancellation of the GST registration at the earliest. Even if the tax officer cancels the registration, they must first apply for revocation of GST cancellation by paying any applicable penalties or GST cancellation fees. Once it is restored, they can cancel the GST or continue to file returns.
Ans. Any business registered under the GST regime is assigned a unique number called the GSTIN. GST cancellation means not being under the GST scheme anymore. It involves cancelling the GSTIN without which the business doesn’t need to pay or charge taxes.
Ans. GST registration cancellation is done either by the tax office or voluntarily by the taxpayer. It is cancelled in either of the following cases:
Discontinuation of business
Business turnover is lower than the threshold
Business constitution changes
The taxpayer doesn’t file GST returns
When registration is acquired through fraud or willful misinformation
Business doesn’t comply with GST rules
GST registration is obtained voluntarily, but the business doesn’t begin operations within 6 months
Ans. Taxpayers can check the status of their GST cancellations through the website www.gst.gov.in. The service menu includes “Track application status”. Click on it and enter the ARN number in the next step. After the ARN search is complete, your application status will be displayed on the screen. It will be either approved or not approved. Subsequently, you will receive an email with your application status from the GST department.
Ans. When a tax officer from the central tax authority starts the GST registration cancellation process, they will send you a show-cause notice that you must respond to within 7 days of receipt. If you fail to do that, your GSTIN will be cancelled. Once cancelled, you must apply for revocation of cancellation within 30 days of the cancellation order.
Ans. You can voluntarily cancel your GST registration if you wish to discontinue your business or cannot sustain it after registration. You must also cancel it if your business constitution changes or your turnover is lower than the threshold.
|Section 194IB||Section 44AA||Section 80E|
|Section 195||Section 80EEA||Section 80DD|
|Section 80CCC||Section 80GG||Section 80 G|
|Section 54F||Section 1941A||Section 10|
|Section 194Q||Section 192||Section 269SS|
|Section 80DDB||Section 44AD||Section 194C|
|Section 194A||Section 194H||Section 80D|
|Section 80C||Section 80C, 24(b), 80EE & 80EEA||Section 234A|
|Section 50C||Section 80C||Section 80EEA|
|Section 194B||Section 194J||Section 206C|
|Section 80CCG||Section 80 EEB||Section 24Q|
|Section 40b||Section 194C||Section 54EC|
How to Claim Leave Travel Allowance? – Benefits, Documents Required and ExemptionsWhat is Leave Travel Allowance? Leave Travel Allowance or LTA, also known as Leave Travel Conces... Read More »
Section 194B – TDS on Lottery, Games, Betting and Game ShowsWhat is Section 194B of Income Tax Act? Section 194B of Income Tax Act, 1961 states that winning... Read More »
What are the Sources of Public Revenue for Government? – Major Tax and Non-tax SourcesThe government undertakes many initiatives and projects aimed at economic growth and progress. This... Read More »
PF Withdrawal Rules 2023 – Rules, Documents Required and TypesEPF/PF Withdrawal Employees’ Provident Fund (abbreviated as EPF) is a popular retirement... Read More »
How to Withdraw PF Amount? – Steps, Eligibility, and Status CheckEmployees Provident Fund (EPF) is a government-backed retirement savings scheme. It falls under the... Read More »
Cess on Income Tax: Overview, Types and CalculationWhat is Cess on Income Tax? Cess is an additional tax on taxes imposed by the central government... Read More »
Short-Term Capital Gains Tax Under Section 111A of the Income Tax ActWhat is Section 111A of the Income Tax Act? Section 111A of the Income Tax Act deals with taxati... Read More »
Old vs New Tax Regime – Which One is More Beneficial in 2023?The government introduced a new tax regime in FY 20-21 in addition to the existing regime and revis... Read More »
Form 26AS – How to View and Download Form 26AS Online?What is Form 26AS? Form 26AS is a consolidated tax statement issued by the Income Tax Department... Read More »
Deductions on Salary Under Section 16 of the Income Tax Act, 1961Section 16 of Income Tax Act, 1961 Section 16 of the Income Tax Act, 1961 mentions allowances an... Read More »
Section 192A of Income Tax Act : TDS on EPF WithdrawalSection 192A of Income Tax Act Section 192A of the Income Tax Act is related to TDS or Tax Deduc... Read More »
Income Tax Deduction Under Section 80EE on Home Loan InterestWhat is Section 80EE of the Income Tax Act? Section 80EE of the Income Tax Act, 1961 was formula... Read More »
Top 10 Chit Fund Schemes in India in 2023Chit funds are one of the most popular return-generating saving schemes in India. It is a financial... Read More »
10 Best Gold ETFs in India to Invest in March 2023Gold ETFs or Gold Exchange Traded Funds are passively managed funds that track the price of physica... Read More »
10 Best Demat Accounts in India for Beginners in 2023Creation of Demat accounts revolutionised the way trades were conducted at the stock exchanges.&nbs... Read More »
20 Best Index Funds to Invest in India in March 2023What is an Index Fund? An index fund is a type of mutual fund or exchange-traded fund (ETF) that... Read More »
Best Arbitrage Mutual Funds to Invest in India in March 2023Arbitrage funds are hybrid mutual fund schemes that aim to make low-risk profits by buying and sell... Read More »
10 Best SIP Plans in India to Invest in March 2023What is SIP? SIP or Systematic Investment Plan is a method of investing a fixed amount in ... Read More »
10 Best Corporate Bond Funds in India to Invest in March 2023Corporate bond funds are debt funds that invest at least 80% of the investment corpus in companies ... Read More »
10 Best Bank for Savings Account in India 2023 – With Interest RatesSavings account is a type of financial instrument offered by several banks. It lets you safely depo... Read More »
All information is subject to specific conditions | © 2023 Navi Technologies Ltd. All rights are reserved.
Start Small. Dream Big.
Start your Investment Journey with just ₹10