Many people have this myth that your GST can be canceled automatically without any formality if it is required or if your GSTIN is not in use but unfortunately it is not like that. There is a proper step by step process which one needs to follow in order to cancel the GST registration either voluntarily or by the department itself. Without completing the GST cancellation formalities one cannot cancel GST registration as per the GST laws of India. One of the most important things which you must be aware of if you are thinking about canceling your registration for GST in India is the checklist of the cancellation of the GST. Here in the present writeup we are going to discuss the complete checklist for completing the procedure for cancellation of GST Registration in India that will help you out whenever you want to cancel your registration for GST in India.
What do you mean by GST Cancellation?
The cancellation for the GST registration states that the said person will no longer be a registered person under the GST category and certainly will not have to pay the required amount or further is eligible to collect any amount of GST, even filing for tax credits or that cannot make returns said person. The cancellation for GST registration is regulated under Section 29 of the central GST Act followed by Rules 20 to 22 of the Central GST Rules.
Types of GST Cancellation under the GST Laws of India
Given below are the type of cancellation of GST registration in India under the GST laws:
- Voluntary Cancellation (Cancellation of GST voluntarily only if they don’t want to continue the business)
- Mandatory Cancellation(By the authorities only if they violate the provisions of the GST Act)
- Non-Filing of Returns(Failing to furnish returns for a continuous period of six months)
- Change in Business Constitution
- Death of Sole Proprietor(Only if the proprietor passes away)
- Transfer of Business (If the business is transferred)
- Ceasing of Business (If the registered person ceases to carry on the business)
- Jurisdiction Change (If the jurisdiction of the tax authority changes)
Checklist Required for the Cancellation of GST Registration
Given below is the checklist of cancellation of GST registration in India:
Documents Required for the Cancellation of the GST
In order to complete the procedure for cancellation of GST Registration one needs the following documents:
- Application for Cancellation (Form GST REG-16)
- Details of Inputs Held in Stock
- Details of Capital Goods Held in Stock
- Details of Liabilities
- Details of the Last Return Filed
- Details of Other Pending Returns
- Documents Related to Business Closure
- Legal Documents(Partnership deeds or incorporation certificate)
- Bank Account Details
- Copy of GST Registration Certificate
Different Types of Forms to be Filed
- Form GST REG-16(For cancellation of GST)
- Form GST REG-17(Show cause notice)
- Form GST REG-18(Respond to show cause notice)
- Form GST REG-19(Actual order for cancellation)
- Form GST REG-20(Satisfied with the show cause reply)
- Form GST REG-21(Revocation for cancellation)
- Form GST REG-22(Order for revocation)
File all Tax Returns
Before opting for cancellation of registration for GST, one must file all tax returns as follows:
- GSTR-1: Monthly/Quarterly return for outward supplies.
- GSTR-3B: Monthly return for summarised details of outward supplies, inward supplies, and input tax credit.
- GSTR-4: Quarterly return for composition scheme taxpayers.
- GSTR-9: Annual return for regular taxpayers.
Pay all Tax Debts
- First log into the GST Portal (https://www.gst.gov.in/)
- To file All Pending Returns
- The next step requires to calculate Outstanding Tax Liability
- To make the Payment
- Now apply for GST Cancellation
- To do the verification and approval
- Clear any Final Liabilities
Complete Pending Audits and Investigations
Compile Necessary Documents as mentioned under documents required for cancellation and must respond to notices. Clear Outstanding Dues and close Audits and Investigations. Without completing all the audits and investigations which are pending one cannot cancel the registration for GST in India. The final step involves filing for cancellation in compliance with GST Laws of India.
Vacate GST Registered Premises
One of the most important formalities is that for the cancellation of the GST Registration in India one needs to vacate the premises on which he or she has taken the registration for Goods and Services Tax. Before vacating the premises you need to notify the authorities. It is not a directory provision but a mandatory one. Hence in order to cancel your registration for Goods and Services Tax in India you need to vacate your GST registered premises.
Consequences for Cancellation of Registration
As the process for cancellation of registration takes place, the below-mentioned things might take effect:
- The cancellation for registration will be notified to the taxpayer via email and SMS.
- Form GST REG-17 will be then sent to the taxpayer which will also be available on the dashboard of the site and can be printed and downloaded.
- The taxpayer will be restricted to further filing for a return or uploading any further invoice for the said period after the procedure for cancellation of GST takes place, and the GSTP (Practitioners) powers will cease to exist as soon as the process takes place.
- The registration details cannot be changed after the issuance of cancellation orders, but the phone number and email ID can be updated until all the said due are cleared.
- The status for GSTIN will now be called as “Proceeding for the cancellation initiated” and “inactive” and the said will now be further informed to the concerned tax authorities.
Conclusion
The procedure for cancellation of GST Registration stands as a process that certainly requires the attention and necessary regulatory compliance that needs to be made and also includes the financial statements and all the required documentation. It stands as a necessary step for this process that is required for proper regulation of the process for GST and to avoid any other future conflicts.
FAQs
- Which section regulates the cancellation of GST Registration in India?
The cancellation for GST registration is regulated under Section 29 of the CGST Act followed by Rules 20 to 22 of the central GST Rules.
- What do you understand about the cancellation of GST?
The said person will no longer be a registered person under the GST category and certainly will not have to pay the required amount or further is eligible to collect any amount of GST.
- What happens after receiving a reply by the authorized officer for the cancellation of GST?
Upon receiving a satisfactory reply the authorized officer then can further pass the order under Form GST REG-20. And if not satisfied then can issue further orders directing for the cancellation of the registration of GST under Form GST REG-19.
- When can the procedure for cancellation of GST be dropped?
With reference to Rule 22 (4) if there is no reply from the taxpayer but still fulfills all the remaining pending returns and makes all the payments for the taxes with the said amount of interest and late fees, the appropriate office may then drop the procedure for the cancellation of registration of GST in Form GST REG-20.
- Can the details for registration be changed during the procedure for cancellation of GST Registration?
The registration details cannot be changed after the issuance of cancellation orders, but the phone number and email ID can be updated until all the said due are cleared.
