There may be situations in which you are required to surrender or cancel your GST registration. The process of GST surrender is relatively straightforward. It can be easily initiated if the GST laws no longer apply to your business or you are winding up your operations.

The registration provided under GST can be revoked for specific grounds. The revocation can be initiated by the department or by the registered individual/entity seeking to cancel their GST identification. In the event of the demise of a registered individual under GST, the lawful successors can request the cancellation of the GST registration. It is important to note that no fee is required to be paid when applying to cancel GST registration.

In this blog, we will discuss the factors leading to the surrender of GST, the steps involved in surrendering GST, and how to do it online.

Factors that Lead to Surrender of GST

  • Discontinuation of business, complete transfer for any reason (including proprietor’s death), amalgamation with another legal entity, demerger, or other forms of disposal.
  • Changes in the business’s constitution.
  • The taxable person (excluding those voluntarily registered under Section 25 subsection (3) of the CGST Act, 2017) is no longer liable for registration.
  • Violation of provisions in the Act or rules made by a registered person.
  • Failure of a person paying tax under the Composition levy to file returns for three consecutive tax periods.
  • Failure of any registered person (excluding those paying tax under the Composition levy) to file returns continuously for six months.
  • Failure of a person who voluntarily registered under Section 25(3) to commence business within six months of registration.
  • Acquisition of registration through fraudulent means, willful misstatement, or deliberate suppression of facts.

GST Compliance

Steps to Surrender GST Registration?

GST registration can be surrendered or canceled through five methods:

  • Surrender by the registered person or company –

The registered individual or company has the option to apply for the cancellation of GST registration if:

  • The turnover is below ₹20 lakhs / 40 lakhs
  • The business or profession is being discontinued.
  • In the case of a proprietorship, if the proprietor has passed away.
  • The business is no longer liable for GST registration.
  • Other valid reasons need to be substantiated in the application.
  • Cancellation by GST Officer –

The GST officer holds the authority to cancel the registration (sometimes retrospectively) if the organization meets the following conditions:

  • Violation of GST regulations by you or your company.
  • Non-filing of tax returns for 6 consecutive months.
  • Acquisition of GST registration through fraudulent means.
  • Inactivity in business operations for a significant period following the GST registration.
  • Existence of any other relevant issues.
  • Surrender by Legal Heir –

Suppose you are still determining the process of surrendering GST registration after the demise of a registered person, particularly in the case of a sole proprietorship firm. In that case, it is important to note that a legal heir has the authority to apply for the cancellation of GST registration.

  • Voluntary Surrender –

Apart from the circumstances where the GST officer or legal heir may cancel GST registration, a registered person or company can also voluntarily surrender their GST registration if they no longer wish to be registered under the GST Act. This allows businesses to manage their GST obligations according to their specific requirements proactively.

  • Cancellation Process –

The GST surrender process involves applying for registration cancellation through the online GST portal. The application must provide the necessary details and reasons for surrendering the registration. Once the application is submitted, the concerned tax authorities will review the application and, if satisfied, proceed with the cancellation process, updating the registration status accordingly.

GST Compliance

How to Surrender GST Online?

If you have decided to surrender your GST Registration for any given reason, it is important to adhere to the following steps:

Step 1: 

Sign in to your GST account online

Step 2: 

  • Navigate to Services.
  • Then Registration
  • After that, Cancellation or Surrender Application.

You will find three options listed as follows:

  • Basic Info
  • Cancellation or surrender of information
  • Authentication.

Step 3: 

Provide the address for future communication or choose “Address similar to the above.” Then, proceed to the Cancellation Details tab.

Step 4: 

Select the appropriate reason for cancellation and indicate the date of cancellation. The page will display the date you have already filed a return.

Step 5: 

Move to the verification tab and complete the verification process using Electronic Verification Code (EVC) or Digital Signature. Upon verification, your Application Reference Number (ARN) will be generated.

In Summary

The GST surrender or cancellation process involves various scenarios and steps that individuals or companies must know. Whether it is voluntary surrender, cancellation by the GST officer, or application by a legal heir, understanding the reasons and procedures is crucial. 

By following the necessary steps, such as logging into the GST portal, filling out the required details in the application, selecting the appropriate reason for cancellation, and completing the verification process, one can initiate the surrender of their GST registration. 

Complying with the guidelines and accurately providing the requested information is important to ensure a smooth and successful GST surrender process.