Cancellation of GST registration – Complete Explanation
By: Tax Hunts
January 25, 2018
With the new Tax regime, every taxpayer is necessary to register themselves under existing law. However, now the threshold limit has for registration been increased to Rs. 20 lakhs. People who are below the category of this limit can apply for cancellation of registration or can be cancelled by correct officer. The article is to discuss in detail about the cancellation of GST Registration such as conditions, procedure and so on.
Cancellation of GST registration
Conditions for cancellation of GST Registration:
Cancellation by the registered person:
A registered GST individual can cancel their registration in one of the following conditions:
If your turnover isn’t more than 20 lakh and you have enrolled on the entrance, yet you would prefer not to file the return. At that point, you ought to get it deactivated as soon as possible; else, you may get a duty see from the legislature.
If the business has been discontinued.
If the business has been transferred or sold to the other person. The other person needs to register for GST.
On the off chance that the individual or business is not any more at risk for GST enlistment. (Like if the enlistment edge is expanded later by the administration and you get out from its cover).
Cancellation by GST officer:
GST registration can be cancelled of the individual or business by correct GST officer if one of the following conditions applies:
If the enrolled individual has violated any of GST arrangements or laws.
A typical enlisted individual who has not recorded returns continuously for a half year.
A composition enlisted individual has not filed tax returns for three sequential quarters.
A voluntarily enrolled individual who has not initiated any business in the half year from the registration date.
If the registration is acquired by misrepresentation techniques, the best possible officer has the privilege to cross out the registration with review impact.
On the off chance that the GST registration of a merchant is crossed out with review impact, it might bring about disavowal of credits to the purchasers who have acquired from such merchants.
The concerned individual will get a legitimate notice demonstrating the reason for enlistment and will be given a chance to account for themselves before the real cancelation.
Payment for the Pending Tax after Cancellation:
The individual who has cancelled the registration of GST still is liable to pay all the dues before the cancellation.
The individual should pay his due taxes either by turning around the information credit in semi-furnished/furnished/crude supply of products one day before the date of cancelation or by paying taxes on the goods. (whichever is higher of the two).
For capital products, the individual should pay either the information credit back which was gone up against these capital merchandise, lessened by a specific rate or the expense pertinent on the exchange estimation of merchandise. (whichever is higher of the two).
How to cancel the registration of GST:
GST registration can be cancelled by using the forms below: GST REG 16– Form is used to apply for cancellation. GST REG 17– An officer can send the show cancellation notice to the enrolled person by this form. GST REG 18– The concerned individual must answer back in this frame inside 7 days of notice clarifying why his/her registration ought not to be crossed out. GST REG 19– This form is utilized by the officer to issue a formal request for cancelation of enlistment. The request is to be sent inside 30 days from the application date or from the date of reaction in GST REG 18 form. GST REG 20– On the off chance that the correct officer is happy with the clarification; he can utilize this shape to drop the cancelation continuing and pass a formal request.
Application for Revocation of Cancellation of enrollment by officer
Present an application in Form GST REG-21 for disavowal of cancelation of registration inside 30 days from the date of administration of the request of cancelation of registration.
Application for renouncement can’t be filed if cancelation is because of inability to furnish returns or inability to pay risk unless such return is documented/liabilities are released.
For defended reasons, PO should deny cancelation of registration inside 30 days of use or receipt of clarification by passing a request in Form GST REG-22.
If the reason is not justified, than PO shall issue SCN in Form GST REG-23.
The response should be filed within 7 days in Form GST REG-24.
Also PO can reject the application by clearing an order in Form GST REG-05 if the reason is unjustified.