If your business or profession is closing, or if a tax officer has requested that you cancel your GST registration, or if GST does not apply to you, this article discusses how you can cancel it.
Cancelling GST registration – What it means
GST registration can be canceled simply by notifying the government. GST will not be due or collected, or input tax credits claimed, so he need not file GST returns.
Cancelling a GST registration has consequences
- GST is no longer payable by the taxpayer.
- GST registration is mandatory for certain businesses. A business will be fined heavily if its GST registration is canceled and it continues to operate.
Migrants’ GSTINs are canceled
In the past, indirect taxes were mandatory for everyone registered under them. Such individuals may have been exempt from GST registration. VAT thresholds are typically Rs.5 lakhs in most states, while the GST threshold is Rs.20 lakh*. Nevertheless, they had to ensure you were not making interstate supplies since registration is required for interstate suppliers, except for service providers.
*In the case of supplying only goods in some states or Union Territories, Rs.40 lakh or Rs.10 lakh, respectively. For such taxpayers, a GST portal form GST REG-29 must be filled out electronically.
An inquiry shall be conducted by the proper officer before cancelling the registration.
Here are the steps for canceling the GSTIN on the GST Portal by the migrated taxpayers:
Step 1 – Click on Cancel Provisional Registration In the GST Portal.
Step 2 –
- This page opens when you click Cancellation.
- You will see your GSTIN and business name automatically.
- Cancellation must be justified.
The taxpayer cancels (other than when migrated)
What are the reasons for cancelling a taxpayer’s registration?
- An end has been reached to the business.
- Transferee (or any new company created by amalgamation or demerger) must get registered after the business has been transferred fully, merged, demerged, or otherwise disposed of. Should the transferor cease to exist, its registration will be canceled.
- There has been a change in the business’ constitution (Example- Public limited company transacted as a private limited company).
How to cancel an order
If you cannot follow the above method, you must file a cancellation request in GST REG 16. Following the same procedure as below will apply to the legal heirs of the deceased taxpayer.
- GST REG 16 must be used to request cancellation.
- GST REG 16- must include the following information.
- Information about the inputs, semi-finished goods, and finished goods held in stock on the date of cancellation.
- Responsibility therefore.
- Payment information.
- A cancellation order must be issued by the proper officer within 30 days from the date of application in form GST REG-19. Taxpayers will be notified of the cancellation by the officer at a date determined by him.
Tax officer cancels return
- Does the officer have a reason for canceling registration?
Taxpayers can cancel their registration if they-
Conducts no business from the place of business declared.
- Unless there is a supply of goods/services, an invoice/bill will be issued without goods/services.
- By not passing on the benefits of a tax credit to customers, the anti-profiteering provisions are violated OR On January 1, 2021, implementation will begin.
- For monthly amounts exceeding Rs.50 lakh using the ITC from the electronic credit ledger, discharge 99% of the tax liability of specified taxpayers who violate Rule 86B.
- Those taxpayers who are unable to file GSTR-1 because they have not filed GSTR-3B for over two consecutive months (one quarter for those opting into the QRMP scheme) OR Input tax credit may not be utilized in violation of section 16 of the Act or the rules.
- Form GST REG-17 is sent to the person if the proper officer believes that his registration should be canceled.
- In the seven days following his receipt of the notice, the person must reply on form REG-18 explaining why he shouldn’t have his registration cancelled.
- In the event of a satisfactory reply, a GST REG–20 order will be passed.
- If the registration is to be cancelled, the proper officer will issue a cancellation order in GST REG-19. The order will be sent within 30 days of the date of the show cause response.
Registrant’s cancellation is revoked
Cancellation revocation: what is it?
When something is revoked, it means that it has been officially withdrawn or retracted. Revoked registration cancellations mean the registration remains valid despite being reversed.
Can a cancellation be revoked?
Tax officers can cancel the registration of taxable persons on their own initiative. The cancellation order may be revoked by the taxable person within thirty days of its date.
- If his registration has been canceled suo moto by the proper officer, a registered person can submit a GST REG-21 application for revocation of cancellation.
- At the Common Portal, it must be submitted within 30 days of the date when the cancellation order was served.
In the 30 days following receipt of the application, the proper officer may revoke the cancellation order by issuing a GST REG-22 order. Registration cancellations must be rescinded in writing.
- Revocation can be rejected by an order in form GST REG-05 and delivered to the applicant by the proper officer.
- Form GST REG–23 must be submitted by the applicant before an application is rejected by the appropriate officer. A response must be submitted in form GST REG-24 within 7 working days of receiving the notice.
- A decision will be made by the proper officer within 30 days after receiving the applicant’s clarification in GST REG-24.
Note: If the registration was cancelled due to non-filing of returns, an application for revocation cannot be filed. These returns must be filed first, along with payments of all taxes, interest, and penalties due.