GST Registration Cancellation: Process, Eligibility, and Consequences

Learn the step-by-step process of cancelling your GST registration.
Business Loan
Apply Now
3 min
11 March 2025

GST registration is mandatory for businesses that exceed a certain turnover threshold, as it enables them to collect GST and claim input tax credits. However, businesses may need to cancel their GST registration if their turnover falls below the threshold, if the business closes, or if there are structural changes. Understanding the processes of registration and cancellation helps businesses remain compliant, avoid penalties, and manage their tax obligations effectively. Additionally, businesses can track their  GST registration application ARN status to stay updated on their registration process.

What is GST registration cancellation?

Cancellation of GST registration refers to the process of nullifying a taxpayer's GST identification number, rendering them ineligible to collect GST or claim input tax credit. This process can be initiated by the taxpayer, tax authorities, or legal heirs in the case of the taxpayer's demise. Understanding the criteria and procedures for cancellation is crucial for compliance with GST laws and avoiding legal complications.

Who is eligible to cancel GST registration?

  • Taxpayer: A registered taxpayer can voluntarily apply for cancellation of GST registration if their annual turnover falls below the threshold limit, or if they are discontinuing their business or changing their business constitution.
  • Legal heirs: In the case of the death of a sole proprietor, the legal heirs can apply for the cancellation of GST registration.
  • Tax authorities: GST officers have the authority to cancel GST registration if they find any non-compliance with GST rules and regulations. This includes issues like non-filing of GST returns, supplying goods or services without issuing an invoice or engaging in fraudulent activities.
  • Business merger or demerger: In cases where businesses are merged or demerged, the existing GST registration might be cancelled, and a new one issued as per the new business structure.

Common reasons for GST cancellation

  • Non-compliance with GST rules: GST registration can be cancelled if a taxpayer does not adhere to the GST rules outlined in the GST act and GST laws, such as failing to file GST returns for a continuous period.
  • Discontinuation of business: If a business discontinues its operations, the taxpayer can apply for cancellation of GST registration to avoid unnecessary compliance requirements.
  • Change in business constitution: A change in the constitution of a business, such as from a sole proprietorship to a partnership, necessitates the cancellation of the existing GST registration and obtaining a new one.
  • Turnover below threshold limit: If the annual turnover of a registered taxpayer falls below the prescribed threshold limit, they can opt to cancel their GST registration.
  • Voluntary cancellation: Taxpayers may voluntarily cancel their GST registration if they believe it is no longer required, provided they meet the conditions specified in the GST act.
  • Fraudulent activities: Engaging in fraudulent activities such as issuing fake invoices or claiming input tax credits without genuine transactions can lead to the cancellation of GST registration by tax authorities.

Step-by-step process for GST registration cancellation

  1. Application:
    • Visit the GST Portal.
    • Login to the GST Portal with your user-ID and password.
    • Navigate to the Services > Registration > Application for Cancellation of Registration option
  2. Details: Provide details such as GSTIN, business name, address, and reason for cancellation.
  3. If taxpayer has issued any tax invoice, then submit a GST REG-16 form online through the GST portal.
  4. Verification: The tax officer verifies the application and supporting documents.
  5. Approval: Upon approval, the officer issues an order for cancellation in the GST REG-19 form within 30 days.
  6. Final return: File a final GST return in the GSTR-10 form to clear any pending liabilities.

Procedure for cancellation of GST registration

  • Application: Submit a GST REG-16 form online through the GST portal.
  • Details: Provide details such as GSTIN, business name, address, and reason for cancellation.
  • Verification: The tax officer verifies the application and supporting documents.
  • Approval: Upon approval, the officer issues an order for cancellation in the GST REG-19 form within 30 days.
  • Final return: File a final GST return in the GSTR-10 form to clear any pending liabilities.

Impact of GST registration cancellation on businesses

  • Cessation of business: The business must stop making taxable supplies.
  • Tax payment: Pay outstanding GST liabilities, including interest and penalties.
  • Input tax credit: Unused input tax credit cannot be claimed.
  • Legal compliance: Comply with all legal obligations, including filing final returns.
  • Revocation restrictions: Once cancelled, registration can only be reinstated through the revocation process.

Things to know about revocation of GST registration cancellation

  • Eligibility: Apply for revocation within 30 days of cancellation order.
  • Application: File GST REG-21 form online through the GST portal.
  • Approval process: Tax officer reviews the application and supporting documents.
  • Communication: Officer may seek additional information or clarifications.
  • Decision: Upon satisfaction, the officer issues GST REG-22 form for revocation.

Steps for revocation of GST registration cancellation:

Step 1: Log in to the GST portal by visiting the official website and signing in with your GSTIN and password. If you have forgotten your credentials, use the "Forgot Username" or "Forgot Password" options to recover them.

Step 2: Apply for Revocation of Cancellation. Once logged in, navigate to the Services section, then Registration, and select the Application for Revocation of Cancellation. This option is available only to businesses whose GST registration was cancelled by the authorities, not for voluntary cancellations. Select your cancelled GSTIN and complete the required fields, providing a clear explanation for your revocation request.

Step 3: File all pending GST returns. Before your reactivation request can be processed, you must file any outstanding GST returns from the period when your registration was inactive. It is essential to settle any due taxes, interest, or penalties, as failure to do so will impede the processing of your request.

Step 4: Submit the required documents. Upload all necessary supporting documents to validate your revocation request. These typically include the PAN card of the business or owner, address proof (such as an electricity bill or rent agreement), bank details (via a cancelled cheque or bank statement), the filed GST returns for the relevant periods, and the completed Application for Revocation (GST REG-21).

Step 5: Pay the applicable penalties and late fees. Calculate and pay all penalties, interest, and late fees associated with your cancelled registration. For example, late filing fees are usually charged at Rs.50 per day (Rs.25 each for CGST and SGST), capped at Rs.10,000 per return, with interest on any unpaid tax calculated at 18% per annum.

Step 6: Respond to GST department queries. The GST department may raise queries or request additional information regarding your revocation request. It is important to check the portal regularly for notifications and respond promptly to avoid any delays.

Step 7: Await reactivation approval. Once all the necessary steps have been completed, your application will be reviewed by the GST department. If approved, you will receive confirmation via SMS or email, and your GSTIN will be reinstated.

Following these steps will help ensure the smooth reinstatement of your GST registration, minimising potential legal or financial complications.

Documents and information required for revocation of GST registration cancellation:

  • GSTIN: Copy of GST registration certificate.
  • Cancellation order: Copy of the cancellation order issued.
  • Reason: Detailed explanation for revocation request.
  • Returns: Copies of all filed returns post-cancellation.
  • Supporting documents: Any other relevant documents as requested by the tax officer.

After submission of the application:

  • Acknowledgement: Receive an acknowledgement receipt.
  • Verification: The tax officer reviews the application and attached documents.
  • Clarification: Respond to any additional information requests from the officer.
  • Order: The officer issues the revocation order or rejects the application within 30 days.
  • Status update: Check the status of the application online through the GST portal.

Conclusion

The GST registration process is crucial for maintaining legal compliance in business operations. Proper cancellation and potential revocation ensure businesses meet regulatory requirements, impacting eligibility for various financial services, including instant business loans. Understanding these procedures helps businesses manage their tax obligations effectively.

Exploring Bajaj Finserv Business Loan

The Bajaj Finserv Business Loan offers many benefits that cater to the unique demands of managing and growing a business quickly and efficiently.

  • Rapid disbursement: Funds can be received in as little as 48 hours of approval, allowing businesses to respond promptly to opportunities and needs.
  • Simplified application process: Online applications streamline the process, reducing paperwork and saving time.
  • High loan amount: Businesses can borrow funds up to Rs. 80 lakh, depending on their needs and qualification.
  • No collateral required: You do not have to pledge any collateral to get our business loan, which is beneficial for small businesses without substantial assets.

Bajaj Finserv app for all your financial needs and goals

Trusted by 50 million+ customers in India, Bajaj Finserv App is a one-stop solution for all your financial needs and goals.

You can use the Bajaj Finserv App to:

  • Apply for loans online, such as Instant Personal Loan, Home Loan, Business Loan, Gold Loan, and more.
  • Invest in fixed deposits and mutual funds on the app.
  • Choose from multiple insurance for your health, motor and even pocket insurance, from various insurance providers.
  • Pay and manage your bills and recharges using the BBPS platform. Use Bajaj Pay and Bajaj Wallet for quick and simple money transfers and transactions.
  • Apply for Insta EMI Card and get a pre-qualified limit on the app. Explore over 1 million products on the app that can be purchased from a partner store on Easy EMIs.
  • Shop from over 100+ brand partners that offer a diverse range of products and services.
  • Use specialised tools like EMI calculators, SIP Calculators
  • Check your credit score, download loan statements and even get quick customer support—all on the app.

Download the Bajaj Finserv App today and experience the convenience of managing your finances on one app.

Do more with the Bajaj Finserv App!

UPI, Wallet, Loans, Investments, Cards, Shopping and more

GET THE APP

Disclaimer

1. Bajaj Finance Limited (“BFL”) is a Non-Banking Finance Company (NBFC) and Prepaid Payment Instrument Issuer offering financial services viz., loans, deposits, Bajaj Pay Wallet, Bajaj Pay UPI, bill payments and third-party wealth management products. The details mentioned in the respective product/ service document shall prevail in case of any inconsistency with respect to the information referring to BFL products and services on this page.

2. All other information, such as, the images, facts, statistics etc. (“information”) that are in addition to the details mentioned in the BFL’s product/ service document and which are being displayed on this page only depicts the summary of the information sourced from the public domain. The said information is neither owned by BFL nor it is to the exclusive knowledge of BFL. There may be inadvertent inaccuracies or typographical errors or delays in updating the said information. Hence, users are advised to independently exercise diligence by verifying complete information, including by consulting experts, if any. Users shall be the sole owner of the decision taken, if any, about suitability of the same.

Frequently asked questions

Can GST registration be cancelled?
Yes, GST registration can be cancelled by the registered person or by the tax authorities in India. Cancellation can occur due to reasons such as business discontinuation, turnover falling below the threshold, or non-compliance with GST regulations. The process involves submitting an application online through the GST portal and following the prescribed procedure.
What is the time limit for a GST cancellation order?
The time limit for a GST cancellation order is 30 days from the date of the order. The taxpayer must file for cancellation within this period to ensure compliance. Delays beyond this timeframe may lead to penalties or other legal consequences, as stipulated by the GST regulations.
What is the final return of GST after cancellation?
The final return of GST after cancellation, known as GSTR-10, is a one-time return that must be filed by a taxpayer whose GST registration has been cancelled or surrendered. This return provides details of stock held and liabilities up to the cancellation date, ensuring all dues are settled.
How to revoke GST registration after 180 days?
To revoke GST registration after 180 days, log in to the GST portal and navigate to the "Services" tab. Select "Application for Cancellation of Registration," fill in the required details, and submit the form. Ensure all pending returns and liabilities are cleared before applying. The GST officer will review and process your request.
Show More Show Less

Related videos