A GST registration may be cancelled voluntarily — where a business has closed, been sold, or has turnover below the threshold requiring registration — or it may be cancelled by the department itself, generally where returns have not been filed for a continuous period.
Voluntary cancellation
An application is filed setting out the reason for cancellation, along with a final return, and any outstanding liability on stock held at the time of cancellation is settled.
Where the department has initiated cancellation
A show-cause notice is generally issued first, and a response can be filed along with the pending returns to have the proceedings dropped. Once a registration is actually cancelled, an application for revocation is available within a limited period, but is time-sensitive.
See also responding to a GST notice.
Cancelling a GST registration
A GST registration can be cancelled either voluntarily by the taxpayer or by the tax officer (suo moto), and in either case the taxpayer is required to file a final return.
Voluntary cancellation
A taxpayer may apply for cancellation under Form GST REG-16, for example on discontinuation or closure of business, transfer of business, or a change in the constitution of the business. The application must include details of stock held and the tax payable on it.
Cancellation by the officer
The proper officer may cancel a registration for reasons such as continued non-filing of returns, registration obtained by fraud, or non-commencement of business within the prescribed period, generally after issuing a show cause notice in Form GST REG-17 and giving the taxpayer an opportunity to respond.
Final return — GSTR-10
Once a registration is cancelled, the taxpayer must file GSTR-10, the final return, within the prescribed period from the date of cancellation or the order of cancellation, whichever is later. Failure to file GSTR-10 can result in a notice and continuing liability.
Frequently asked questions: GST registration cancellation
When can a taxpayer apply for cancellation?
Typically on closure or transfer of the business, a change in its constitution that affects the registration, or when the business falls below the turnover threshold and no longer needs to be registered. The application in Form GST REG-16 is to be filed within 30 days of the event.
What happens to input tax credit on cancellation?
The registered person has to pay an amount equal to the credit on inputs held in stock, on semi-finished and finished goods, and on capital goods, or the output tax on them, whichever is higher. The stock details are declared in the cancellation application.
What is the final return?
Form GSTR-10 has to be filed within three months of the date of cancellation or of the cancellation order, whichever is later. It is not required for taxpayers under the composition scheme.
Can the department cancel a registration?
Yes. Common grounds are not filing returns for the prescribed period, not commencing business, or registration obtained by misstatement. The officer issues a show cause notice in Form GST REG-17, and a reply is filed in Form GST REG-18 within the time stated in the notice, which is seven working days under the rules.
Can a cancelled registration be restored?
An application for revocation in Form GST REG-21 can be filed within 90 days of service of the cancellation order (the limit was 30 days before 1 October 2023), with the pending returns filed and tax, interest and late fee paid. On sufficient cause, the Commissioner or an authorised Additional or Joint Commissioner can extend this by up to 180 days more. Revocation is available only where the officer cancelled the registration, not where the business applied for cancellation itself.
Assistance with this matter
If you need assistance with GST registration, amendment, cancellation or a notice, you may contact this office through the Contact page to discuss your specific situation.
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This page describes general procedure and does not constitute legal advice. What applies to a particular matter depends on its own facts.
This page describes general procedure and is published for information only, in keeping with Rule 36 of the Bar Council of India Rules. It is not legal advice and does not solicit work. What applies to a particular matter depends on its own facts.