GST Cancellation

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Completely managed GST registration service until obtaining GSTIN with Expert Support and 1 year LEDGERS accounting software. Inclusive of all government fee and taxes.

Completely managed GST registration cancellation service with Expert Support and filing of last GST return.

Completely managed GST registration cancellation service with Expert Support and filing of last GST return.

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GST Cancellation

How to apply for GST cancellation?

Before applying for GST registration cancellation, the taxpayer is required to file all the GST returns. If non-compliance concerning GSTR-3B return or GSTR-1 or GST annual return, the overdue must be filed before initiating the GST cancellation process.

The application for GST cancellation should be made in Form GST REG-16 on the common GST portal. In the GST cancellation application, the following information must be provided.

  • Contact address, which includes the mobile number and e-mail address. Reason for cancellation.
  • The desired date of cancellation.
  • Particulars of the value and the tax payable on the stock of inputs, the inputs available in semi-finished goods, inputs available in finished goods, the stock of capital goods/plant and machinery.
  • Particulars of registration of the entity wherein the existing unit has been merged, amalgamated, or transferred.
  • Particulars of the latest GST return filed by the taxpayer along with the ARN of the particular return.

Final GST Payments

Before applying for GST cancellation, the applicant must pay all the overdue GST liability. In addition to this, the input tax contained in the stock of inputs, semi-finished goods, finished goods, and capital goods or the output tax liability of such goods, whichever is higher, must be remitted by the taxpayer.

The input tax credit on the existing stock must be paid back, as the taxpayer will not be eligible to claim ITC on cancellation of GST registration.

The final GST payment can be made through GST electronic credit or cash ledger. The final payment can also be made during the submission of the filing of the final GSTR-10 return.

Non-Acceptance of cancellation

Why does the GST registration cancellation application get rejected?

After submitting the GST cancellation application, the application can be approved, and the registration would stand canceled on the date mentioned in the order.

In some instances, the concerned Officer may decide to reject the application if :

  • 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.
  • In such circumstances, the concerned Officer provides an intimation in writing to the applicant regarding the discrepancy’s nature.
  • The applicant is required to respond to the same within seven days of the date of receipt of the letter. If the applicant fails to do the same, he may reject the application after providing him/her with an opportunity to be heard.

GSTR-10 - Final GST Return

Every person whose registration is canceled is required to file a final GST return in Form GSTR-10 within three months of the date of cancellation or the date of order of cancellation, whichever is later.

This is done to ensure that the taxpayer is devoid of liabilities. It may be noted that Input Service distributors or Non-resident taxpayers who are required to pay tax under Section 10, Section 51, or Section 52 are exempted from this provision.

If the final GST return is not filed in Form GSTR-10, then the taxpayer will be issued a notice in GSTR -3A prompting him or her to do the same within 15 days of issues of such notice.

If the taxpayer fails to comply with the notice, initiatives will be taken to assess the taxpayer’s liability based on the information available with the concerned Officer. The assessing order will be withdrawn if the applicant files the return within 30 days of the issue of notice.

Consequences of not cancelling

What happens if a GST registration is not canceled?

If there is no business activity after obtaining GST registration, the taxpayer needs to initiate the GST cancellation as per the process laid out. If the taxpayer stops filing the GST returns and lets the GST registration be canceled, then he cannot obtain another GST registration under the same PAN.

If the government cancels a GST registration, the taxable person will first apply for revocation of the GST registration cancellation by paying all the late fees. After restoration, cancel the GST properly or continue filing GST returns.

Hence, once a GST registration is obtained, the taxpayer needs to monitor the compliance. There is no business activity file for cancellation of GST registration at the earliest. The suspension of GST registration can be revoked after the completion of GST registration cancellation proceedings. The revocation of suspension of GST registration will be effective from the date the suspension has come into effect.