GST Registration
Cancellation


At TaxHint Advisors, we streamline the GST registration cancellation process to ensure a hassle-free experience. Our expert team provides comprehensive guidance and handles all necessary paperwork, ensuring compliance with regulatory requirements.

Trust us to manage the complexities and handle your GST registration cancellation with professionalism and expertise.

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GST Cancellation

GST registration can be canceled voluntarily if the business is dormant or does not have the necessary business turnover. A GST officer may also cancel a business's GST registration if it fails to comply with the law. Once canceled, the person or entity is no longer required to file GST returns, pay GST, or collect GST.

At Taxhint Advisors, we are committed to providing a seamless and hassle-free GST cancellation service. Our team of knowledgeable experts is prepared to help you at every stage, from understanding the requirements for cancellation to ensuring timely and compliant submissions.

GST Registration Cancellation

Upon cancellation of GST registration, the person or entity is no longer recognized as a GST-registered taxpayer. This termination implies that they are not obligated to collect, file, or pay GST and are relieved from the duty to file GST returns or claim input tax credits.

Importance of Timely GST Cancellation

If there is no business activity after obtaining GST registration, the taxpayer must initiate the prescribed cancellation procedure. Failure to do so may prevent applying for a new GST registration with the same PAN.

  • If the government cancels a GST registration, the taxable person must apply for the cancellation to be revoked and pay any late fines. After restoration, either properly cancel the GST or continue filing GST returns.
  • Therefore, monitor compliance closely after receiving GST registration. If there is no economic activity, file for GST cancellation as soon as possible.

Criteria for GST Cancellation:
Who Can Apply?

The following types of persons can apply for GST Cancellation:

By the Taxpayer:

Taxpayers with a GST registration may choose to initiate the cancellation process on their own. This could be due to the perceived lack of need for registration or because they meet certain requirements for cancellation.

By Tax Authorities:

Tax authorities have the authority to cancel a taxpayer's GST registration if they discover any violations of the law or discrepancies in the taxpayer's actions or documentation. They can use the GST REG-17 form to release a show-cause notice to start this process.

By Legal Successors:

When a taxpayer passes away, their heirs or legal successors may file a request to have their GST registration revoked.

Voluntary GST Cancellation:

A cancellation request in Form GST REG-16 must be sent to the GST Department by an individual or organization having a GST registration to cancel it. If the GST Officer is satisfied with the application after evaluating it, they will issue an order in Form GST REG-19 terminating the GST registration.

Voluntarily canceling a GST registration helps avoid the hassle of filing monthly GST returns and incurring penalties or late fees.

Cancellation by GST Officer:

If an officer has a valid reason, they may initiate the cancellation process under GST. A show-cause notice in Form GST REG-17 would be sent out as the first step. The taxpayer will be notified of the pending cancellation and will have a chance to respond before the final decision is made.

Cancellation by Legal Heirs:

In the event of a sole proprietor’s death, the business's GST registration may be cancelled at the request of the proprietor's legal heirs.

Entities Ineligible for GST Cancellation:

Tax Deductors/Collectors: The right to request GST cancellation is not available to entities registered specifically for tax collection or deduction.

Holders of Unique Identity Number (UIN): Entities or individuals with a UIN, such as foreign diplomatic missions or United Nations agencies, cannot apply for GST cancellation. They use the UIN primarily for filing tax refund claims.

Reasons for Cancellation of GST Registration

GST registration can be cancelled by the taxpayer or by the GST authorities due to various reasons. Here are the key reasons for such cancellations:

Initiated by the Taxpayer:

  • Closure of Business: The taxpayer has the option to request the termination of their GST registration when their business operations are permanently stopped or ceased.
  • Business Transfer: The taxpayer may choose to cancel the GST registration in the event that the business is sold, leased, amalgamated, transferred, or otherwise disposed of.
  • Change in Business Structure: The taxpayer is required to terminate the current GST registration in the event that the business structure changes, such as when a partnership firm becomes a corporation.
  • No Longer Liable to Pay GST: The taxpayer must file for cancellation if their turnover is less than the GST threshold and they are no longer needed.
  • Voluntary Cancellation: A taxpayer may choose to voluntarily discontinue their business or personal GST registration.

Enforced by GST Authorities:

  • Non-Compliance with GST Laws: If a regular taxpayer fails to furnish GST returns for six consecutive months or a composition taxpayer for three months, the GST authorities may cancel the registration.
  • Fraudulent GST Registration: If GST registration is obtained by fraud, willful misstatement, or suppression of facts, the GST authorities may cancel it.
  • Violation of GST Rules or Act: Significant non-compliance or violations of GST law provisions can lead to cancellation by the GST authorities.
  • Unauthorised Activities: If the taxpayer is engaged in activities unauthorized under GST laws or fraudulent in nature, the GST authorities may cancel the registration.
  • Non-Commencement of Business: If the registered taxpayer has not started business operations within the specified timeframe from the date of registration, the GST authorities may cancel the registration.

Consequences of Cancellation of GST Registration

The cancellation of GST registration has several significant implications for businesses. Here are the key consequences:

Stop Gathering GST:

A company that cancels its GST registration is no longer able to collect GST from its clients. Updates to all invoicing and billing systems are required by the company to guarantee that GST is not applied after the cancellation's effective date.

Lack of the Input Tax Credit (ITC):

ITC is not available for purchases made after the GST registration has been cancelled. Furthermore, as of the day immediately prior to the cancellation date, the taxpayer is required to pay a sum equal to the ITC for capital goods, inputs in semi-finished or finished items, and goods held in stock, subject to specific criteria.

Final Return Filing:

Within three months after the date of cancellation or the date of the cancellation order, whichever comes first, the taxpayer must file a final return using Form GSTR-10.

Observance and Documentation:

Businesses still have to keep their financial records, accounts, and paperwork up to date for six years following the cancellation date. Any upcoming tax authority audits, inquiries, or compliance checks will require this.

Consequences for Law:

Penalties and legal action by the GST authorities may result from failure to comply with the conditions of the GST law following cancellation, such as failing to file the final return or failing to pay the amount owed on the ITC reversal.

Effect on Business Operations:

Regular business activities may be disrupted by the revocation of a GST registration. After cancellation, reapplying for GST registration entails a new application and examination by tax authorities.

Refunds:

If eligible taxpayers ask for a refund within the allotted time frame, they will be refunded for any excess GST paid after cancellation.

Cancellation of Every PAN Registration:

The cancellation of a GST registration in one state or for one vertical may result in the cancellation of all GST registrations linked to the same PAN across India if a business operates in numerous states or has various business verticals within a state.

Steps for Cancellation of GST Registration

Login to the GST Portal: Navigate to the GST Portal and log in using your credentials.

Apply for Cancellation

Go to the ‘Services’ tab, select ‘Registration,’ and choose ‘Application for Cancellation of Registration.’

Fill in the Details

  • Provide necessary details such as the reason for cancellation, date of cancellation, and value/details related to the ITC of the inventory on the date of cancellation.
  • If multiple businesses are registered within the same state, specify which business the cancellation is applied for.

Pay Liabilities and File Returns

  • Make the payment of any pending dues, including taxes, interest, or penalties.
  • File all pending returns up to the date of cancellation.

Verification and Submission

  • Verify the information submitted in the application form using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC).
  • Submit the completed application.

ARN Generation

After submission, an Acknowledgement Reference Number (ARN) is generated. Use the ARN to track the status of your application.

Officer’s Review

A GST officer will review the cancellation application. If additional information is needed, they may request it through the GST portal. Respond promptly to any queries.

Issue of Cancellation Order

If the officer is satisfied, a cancellation order will be issued using Form GST REG-19, specifying the effective date of cancellation.

Filing the Final Return Post GST Cancellation

The person or company must file a final GST return on Form GSTR-10 within three months of the cancellation date or the cancellation order date, whichever comes first, following the conclusion of the GST cancellation process.

The purpose of this is to ensure that the taxpayer does not owe any GST. Distributors of input services and non-resident taxpayers required to pay tax under Sections 10, 51, or 52 are exempt from this provision.

The taxpayer will receive a notice in Form GSTR-3A asking them to complete the final GST return within 15 days of the notice's issuance if it is not filed in Form GSTR-10.

If the taxpayer disregards the notification, actions will be taken utilising the information at hand to ascertain the taxpayer's liability.

How Taxhint Advisors Streamlines
GST Registration Cancellation

The process of cancelling a GST registration can be difficult to navigate, but Taxhint Advisors can make the process easier and more effective. Here's a detailed explanation of our help with closing a GST account:

Pre-Cancellation Assessment

The actual process begins with the submission of the GST cancellation application using Form GST REG-16 on the official GST portal. The form requires detailed information, such as:

Submitting Cancellation Application

The actual procedure starts when the application for GST cancellation is submitted on the official GST portal using Form GST REG-16. The form requests certain details, including:

  • Updated contact details, encompassing mobile number and email address.
  • The reason prompting the cancellation.
  • The preferred date for cancellation.
  • A detailed breakdown of values and taxes related to stock inputs, semi-finished goods, finished products, and capital assets like machinery.
  • Specifics related to the most recent GST return filed, along with the ARN (Application Reference Number) of that return.

Navigating Official Procedures:

Following submission, the application is examined by a GST Officer. It is anticipated that the Officer will provide a cancellation order in Form GST REG-19 within 30 days of the application date. The officer will decide when the GST cancellation takes effect and will notify the taxpayer of this decision. The question of how to terminate a GST account is therefore resolved.

Rejection of application for GST cancellation

In some instances, the concerned Officer may reject the application for the following reasons.

  • The submitted application is incomplete.
  • In the Transfer, merger, or amalgamation of business, the new entity has not registered with the tax authority before applying.

Revocation of GST Registration Cancellation

The cancellation of GST registration can be revoked under specific circumstances:

  • Conditions for Revocation: Revocation is possible only if the GST authorities cancel the GST registration. It is not permitted if the taxpayer voluntarily cancels the registration.
  • Application for Revocation: The taxpayer can apply for revocation of the cancellation within 30 days from the date of the cancellation order issued by the GST authorities.

Procedure for Revocation of GST Registration Cancellation

  • Login to the GST Portal: Access the GST portal using your credentials.
  • Navigate to Revocation Application: Go to the ‘Services’ tab, then select ‘Registration’ and choose ‘Application for Revocation of Cancelled Registration’.
  • Provide Reasons for Revocation: Enter the reasons for revoking the cancellation and provide supporting documents, if any.
  • Verification and Submission: Verify the information using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC) and submit the application.
  • Acknowledgement: Upon successful submission, an Acknowledgement Reference Number (ARN) will be generated for tracking the application status.
  • Officer’s Review: The GST officer will review the application and may request additional information or documents if necessary.
  • Decision: If the officer is satisfied with the application, they will revoke the cancellation and restore the GST registration.

Why Choose Taxhint Advisors?

Consulting with a Taxhint Advisors GST Expert might be quite helpful if you're thinking about closing your GST account...

When Taxhint Advisors are on your side, cancelling your GST registration is a hassle-free process.

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