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GST Cancellation
Is your business no longer active or not required to be registered under GST? Apply for GST Cancellation today! Avoid late fees and stay compliant. The process is quick, simple, and can be done online. Don’t wait—start your GST Cancellation now and keep your records clean and up to date.
GST Cancellation : Overview
Every business or person who is required under law must register under GST (Goods and Services Tax). But sometimes a business may shut down, or no longer meet the conditions for registration. In such cases, GST Cancellation (cancelling one’s GST registration) becomes necessary.
This process ensures you are no longer treated as a GST‐registered person, and you stop being liable for certain GST obligations.
What is GST Cancellation?
“GST Cancellation” means that your GST registration is terminated or surrendered. After cancellation:
- You are no longer considered a GST-registered taxpayer.
- You cannot collect GST on your sales.
- You cannot claim input tax credit (ITC) on purchases made after cancellation.
- You are not required to file regular GST returns (for periods after cancellation).
However, cancellation does not automatically relieve you of all past liabilities. You may still have to settle taxes, reverse credits, file a final return, etc.
Reasons for GST Registration Cancellation
1. Voluntary GST cancellation by taxpayer
- Your business has permanently closed or is discontinued.
- The business is transferred, merged, or otherwise disposed of, and the new entity will register afresh.
- Your constitution or PAN has changed in a way that the existing registration is no longer valid.
- You registered voluntarily (for example, though your turnover was below threshold) and now want to surrender registration.
2. GST Cancellation by tax authorities
- You fail to carry on business from the declared place.
- You issue invoices without supplying goods/services (i.e. wrongful or fictitious invoices).
- You repeatedly fail to file GST returns (e.g. six continuous periods for regular taxpayers).
- You misuse input tax credit or contravene GST provisions.
- The registration was obtained fraudulently or via misstatement.
When the officer proposes to cancel, you will be issued a show-cause notice giving you chance to respond.
Documents Required For GST Registration 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
1. Prepare to apply
- Gather details of stocks (inputs, semi-finished goods, finished goods) held as of the day right before cancellation.
- Estimate or compute tax liability on those stocks (if ITC was claimed earlier).
- Collect relevant business records, invoices, accounts, etc.
- Decide the effective date of cancellation.
2. Application by taxpayer (if voluntary)
- Log in to the GST portal and go to the “Cancel Registration” section.
- Fill in Form GST REG-16 with reason for cancellation and details such as stocks and liability.
- Submit the application online.
- After submission, the officer has 30 days to issue an order (accept or reject) in Form GST REG-19.
3. Cancellation initiated by tax officer
- Officer issues Form GST REG-17 as a show-cause notice.
- You must reply in Form GST REG-18 within 7 days of receiving the notice.
- Based on reply, officer may drop proceedings via REG-20 or cancel registration via REG-19.
4. Cancellation order & effect
- Officer issues cancellation order (REG-19) within 30 days of reply.
- Cancellation becomes effective from a date decided by the officer.
- GST status becomes “inactive” and registration cannot be used further.
What Happens After Cancellation?
- Final return: File GSTR-10 within 3 months from the date of cancellation order (or date of cancellation, whichever is later).
- Reversal / payment on stocks & capital goods: Reverse ITC or pay tax on stock/assets held before cancellation.
- Maintain records: Keep books and documents for at least six years.
- No further GST collection or credit: Cannot collect GST or claim ITC after cancellation.
Penalties for non-compliance
If after cancellation, the business continues collecting GST or misuses the registration, it can attract penalties or legal action. Also, failing to file final return or failing to settle reversal obligations can incur penalties.
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