GST Registration Cancellation

Overview of Canceling a GST registration

GST registration is cancelled if the taxpayer is no longer a GST-registered individual. In such a case, he is not bound to pay or collect GST, and he will not need to file GST reports.

What can be your reasons behind GST registration cancellation?

For the following circumstances, your registration may be cancelled:

• If a person is not required to register under the GST Act because he is registered under any other law;
• The business is dissolved due to the death of the proprietor, amalgamated with another organization, or disposed of;
• The registered person violates the provisions of the Act and its regulations;
• The registered person fails to register his GST returns for three consecutive tax periods or consecutive six months;
• Any person who has taken voluntary registration under sub-section (3) of section 25 and does not have an active business since the date of registration;
• If registration has been obtained through fraud means

The results of cancelling your GST registration

The taxpayer will be unable to collect GST or be liable to pay GST if the GST registration is cancelled. GST registration is mandatory for certain types of businesses, and they will be punished with penalties if they cancel their GST registration and continue to do business.

Who has the option to cancel GST registration?

Any taxpayer can cancel his GST registration as they wish by completing the GST cancellation method.

However, there are certain conditions like – In the case of any errors in the submitted documentation, the authority can terminate the GST registration. If the taxpayer dies, their legal heir can also cancel the registration.

Cancellation of documents

In the case of the untimely death of the taxpayer, the legal heirs can follow the following steps:-

• Form GST REG 16 must be duly filled in order to register a cancellation request.
• In this form, the details of inputs, semi-finished, and finished items as per the stock on the date of cancellation of registration must be mentioned.
• Payment is to be made.
• To commence with the cancellation, the concerned authority must issue a cancellation order within 30 days of receiving the application.
• After all the steps, the taxable person will be notified about the cancellation process date decided by the officer.

Cancellation by a Tax officer

Why will the officer refuse to register?

The registration can be revoked if the taxpayer.

(a) the actual place of business is different from the declared place of business

(b) fails to deliver goods or services against an invoice and thus violates the provisions of the GST Act

(c) violates the anti-profiteering provisions

(d) violates the anti-abuse provisions that came in effect from January 1, 2021,

(d) Discharging more than 99 per cent of the tax debt for select taxpayers who violate Rule 86B – with taxable supplies exceeding Rs.50 lakh in the month, with some exceptions.

(e) A taxpayer who is unable to file GSTR-1 because GSTR-3B has not been filed for over two months (one quarter of the QRMP scheme is chosen)

(f) A taxpayer who receives an input tax credit due to violation of section 16 of the Act or the rules.

Revocation of cancellation of registration

What is cancellation revocation?

Revocation of cancellation of GST registration says that the cancellation decision itself has been reversed, and the registration is still valid.

When to revoke a cancellation?

These are the conditions one can apply for revoking the cancellation process.

• If a Tax Officer decides to cancel the registration of a taxpayer, then the taxpayer can request the officer to revoke the cancellation order.
• If a registered person has himself applied for the cancellation by the proper officer, an application can be filed for revocation of cancellation in form GST REG-21.
• There is a 30 days window from the date of serving the cancellation order at the Common Portal to submit the revocation request.
• Upon mentioning the reasons for registration revocation documented in writing, if the officer is satisfied, he will accept the revocation request of the cancellation of registration within 30 days of receiving the application by issuing an order in form GST REG-22.
• The concerned officer can issue an order in GST REG-05 if he decides to reject the revocation application, thereby informing the taxpayer.
• However, before rejecting an application, the authority must give them a chance to explain why the application should not be refused in the form of a show-cause notice in GST REG–23; within seven working days of receiving the notice, the applicant is required to respond in form GST REG-24.
• The concerned officer will decide within 30 days of receiving the applicant’s clarification in form GST REG-24.

Frequently Asked Questions