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You can cancel your GST registration if the GST rules don’t apply to you or you are shutting down your business or profession, or the tax officer calls for cancellation. This article will guide you through the different types of cancellations, and the overall process.
Latest Updates on Cancellation of GST Registration
1st February 2022
Budget 2022 updates-
Section 29 of the CGST Act is amended for cancellation of GSTIN by officer:
1. If a composition taxable person fails to file an annual return for three months beyond the due date of 30th April of the following year, his registration can get cancelled.
2. For any other regular taxpayer, registration will be cancelled if there is the default for consecutive tax periods as prescribed against earlier the six months consecutive default in return filing.
21st December 2021
From 1st January 2022, CBIC made the aadhaar authentication mandatory to apply for revocation of cancelled GST registration under the CGST Rule 23 in REG-21.
29th August 2021
Taxpayers can get extended time up to 30th September 2021 to revoke cancelled GST registration if the last date for the same falls between 1st March 2020 and 31st August 2021. It applies if the GST registration is cancelled under Section 29(2) clause (b) or (c) of the CGST Act via CGST notification number 34/2021 dated 29th August 2021.
28th May 2021
Due date to file an application for revocation of cancellation of registration falling between 15th April 2021 up to 29th June 2021 is 30th June 2021.
Cancellation of GST registration simply means that the taxpayer will not be a GST registered person anymore. He will not have to pay or collect GST or claim the input tax credit and accordingly, need not file GST returns.
The below infographic guides you on who can call for the cancellation of GST registration-
*** Application for cancellation, in case of voluntary registrations made under GST, earlier could have been made only after one year from the date of registration. This provision stands rescinded.
Every person who was registered under erstwhile indirect tax laws had to mandatorily migrate to GST. Many such persons may have not been liable to be registered under GST. For example, the threshold under VAT in most states was Rs.5 lakhs and Service Tax was Rs.10 lakh, whereas it is Rs.20 lakh* under GST. However, they had to make sure you are not making inter-state supplies since registration is mandatory for inter-state suppliers except for service providers.
*Rs.40 lakh in case of a supply of only goods in some states or Rs.10 lakh in certain special category states/Union Territories. Such a taxpayer had to submit an application electronically in the form GST REG-29 at the GST portal.
The proper officer shall, after conducting an enquiry as required would cancel the registration.
Below are the steps for cancelling GSTIN by the migrated taxpayers on the GST Portal-
Step 1- Log in to the GST Portal and click the Cancellation of Provisional Registration
You will be asked if you have issued any tax invoices during the month.
Simply fill up the details of authorized signatories and their place. Finally, sign off with EVC if you are a proprietor or a partnership firm. LLPs & Companies must mandatorily sign with DSC.
Note: Taxpayers who have not issued tax invoices can avail above service. If the taxpayer has issued any tax invoice then FORM GST REG-16 needs to be filed. Refer below.
(For example- A private limited company has changed to a public limited company)
All those who cannot follow the above method must file an application for cancellation in form GST REG 16. The legal heirs of the deceased taxpayer will follow the same procedure as below.
The registration can be cancelled if the taxpayer-
(a) Does not conduct any business from the declared place of business OR
(b) Issues invoice or bill without supply of goods/services (i.e., in violation of the provisions) OR
(c) Violates the anti-profiteering provisions (for example, not passing on the benefit of ITC to customers) OR
With effect from 1st January 2021-
(d) Utilisation of ITC from electronic credit ledger to discharge more than 99% of the tax liability for specified taxpayers violating Rule 86B – with the total taxable value of supplies exceeding Rs.50 lakh in the month, with some exceptions. OR
(e) A taxpayer who cannot file GSTR-1 due to GSTR-3B not being filed for more than two consecutive months (one quarter for those who opt into the QRMP scheme) OR
(f) Avails input tax credit in violation of the provisions of section 16 of the Act or the rules.
Revocation means the official cancellation of a decision or promise. Revocation of cancellation of registration means that the decision to cancel the registration has been reversed and the registration is still valid.
This is applicable only when the tax officer has cancelled the registration of a taxable person on his own motion. Such taxable person can apply to the officer for revocation of cancellation within thirty days from the date of the cancellation order.
Note: Application for revocation cannot be filed if the registration has been cancelled because of the failure to file returns. Such returns must be furnished first along with payment of all dues amounts of tax, interest & penalty.
Clear GST Software is a user-friendly easy-to-use software to help you in easy, timely, error-free filing of GST returns. To know more about GST registration and other information, please refer to our various articles. To know more about transition to GST, please read our extensive articles on GST.
Yes, there is no restriction to taking GST registration once it has been cancelled except where it was cancelled by the tax officer.
For more information, read a host of articles by ClearTax: