Understanding GST Registration Cancellation

Cancellation or surrender of Goods and Services Tax (GST) registration refers to the formal process of deactivating a registered taxpayer's GSTIN (GST Identification Number). Once cancelled, the taxpayer is no longer required to collect or pay GST, nor file GST returns. This process is essential for businesses that have ceased operations, undergone significant changes, or no longer meet the criteria for mandatory GST registration.

Reasons for Cancelling GST Registration

1. Cessation of Business Operations: The business has been discontinued or closed permanently.
2. Transfer of Business Ownership: The business has been sold, merged, demerged, or otherwise transferred, necessitating the new entity to obtain its own GST registration.
3. Change in Business Constitution: Alterations in the business structure, such as transitioning from a partnership to a sole proprietorship, leading to a change in PAN.
4. Non-Requirement Under GST: The business's turnover falls below the threshold limit for GST registration, and it is not engaged in interstate supplies or other activities requiring mandatory registration.
5. Death of the Sole Proprietor: In the event of the proprietor's demise, the legal heirs may apply for cancellation.
6. Voluntary Cancellation: The taxpayer opts to cancel the registration for reasons such as business restructuring or other personal considerations.

Procedure for Cancelling GST Registration

1. Access the GST Portal: Log in to the GST Portal using your credentials.
2. Navigate to Cancellation Application: Go to 'Services' > 'Registration' > 'Application for Cancellation of Registration'.
3. Provide Details:
• Basic Information: The system will auto-populate details like GSTIN, legal name, and address.
• Address for Future Correspondence: Confirm or update the address.
• Reason for Cancellation: Select the appropriate reason from the dropdown menu.
• Date of Cancellation: Specify the desired effective date for cancellation.
• Tax Invoice Information: Indicate whether any tax invoices were issued during the current period.
4. Verification: Complete the verification section by selecting the authorized signatory and place.
5. Submission: Submit the application using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC), as applicable.
6. Acknowledgment: Upon successful submission, an Application Reference Number (ARN) will be generated for tracking purposes.

Documents Required for GST Cancellation

• PAN Card: Permanent Account Number of the business or proprietor.
• Aadhaar Card: Identification of the authorized signatory.
• GST Registration Certificate: Proof of existing GST registration.
• Details of Last GST Return Filed: Information on the most recent GST return submitted.
• Business Closure Proof: Documents such as a business closure declaration or dissolution certificate.
• Bank Account Statement: Recent statements reflecting business transactions.
• Authorization Letter: If the application is filed by an authorized representative.

Consequences of GST Registration Cancellation

Revocation of GST Registration Cancellation

If the GST registration was cancelled by the tax authorities and the taxpayer wishes to reinstate it, an application for revocation must be filed within 30 days from the date of the cancellation order. This involves:

1. Filing an Application: Submit Form GST REG-21 through the GST portal.
2. Providing Reasons: Clearly state the reasons for seeking revocation and address the grounds on which the cancellation was initiated.
3. Compliance Rectification: Ensure all pending returns are filed, and any outstanding dues are paid.
4. Awaiting Decision: The tax officer will review the application and communicate the decision.