GST Cancellation Procedure and Fees

GST Cancellation: Understanding the Process and Implications

Cancellation of GST registration is feasible under specific circumstances either voluntarily or initiated by a GST officer. Here's a detailed breakdown of how to cancel GST registration and the implications associated with the process.

Voluntary GST Cancellation

Voluntary cancellation of GST can occur if the business becomes dormant or if the turnover falls below the threshold. It's a straightforward process that involves submitting a request Form GST REG-16 to the GST Department. Once the application is reviewed, and the GST Officer approves it, an order Form GST REG-19 for termination of GST registration is issued. The primary reasons for voluntary GST cancellation include discontinuation or closure of the business, change in business constitution, or a reduction in turnover below the GST threshold. Voluntarily cancelling GST registration alleviates the need for regular GST returns filing, potentially preventing late-filing of GST cancellation fees or penalties.

GST Cancellation by GST Officer

Under specific scenarios, a GST officer can initiate the cancellation of GST registration. This includes instances where a taxpayer continuously fails to file GST returns, doesn't start a business within six months of voluntary registration, violates GST Act sections or rules, or procures registration through deceit. Upon discovery of such violations, the GST Officer issues a show-cause notice Form GST REG-17 to the taxpayer, highlighting the reasons for potential cancellation. The taxpayer gets an opportunity to respond, and after due consideration, the Officer may either dismiss the case or issue an order for cancellation Form GST REG-19.

GST Cancellation Process

GST Cancellation Process Businesses aiming to cancel their GST registration need to follow a systematic process:
  • Step 1: Submission of application for GST cancellation Form GST REG-16 via the common GST portal. This application requires specific details, including contact information, reasons for cancellation, desired cancellation date, and particulars of the latest GST returns filed.
  • Step 2: The GST Officer reviews the application and issues a cancellation order Form GST REG-19 within 30 days. The cancellation becomes effective from a specified date, and the taxpayer is properly informed.
For a more detailed and step by step process, please follow the official GST page Consultation with a Goodwill Enterprises our Experts is recommended for efficient and compliant GST cancellation. They can assist in filing overdue returns, navigating the cancellation application, and ensuring a smooth completion of the process.  

Final Return

After the GST registration cancellation, a final GST return Form GSTR-10 must be filed within three months. This ensures clearance of any pending GST dues, except for specific categories. Failure to file the final return within the stipulated time may result in a notice Form GSTR-3A, mandating the return filing within 15 days. Ignoring this notice could lead to assessment and potential penalties. To avoid any complications or penalties associated with GST cancellation, seek Goodwill Enterprises’ expert advice and ensure timely compliance with the cancellation process.

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