If you want to close your GST registration voluntarily, the process has changed. Applications in FORM GST REG-16 now go through system checks, and many are cancelled without a tax officer stepping in, as long as your returns are in order. The process follows Rule 20 of the CGST Rules.
Step 1: Every due return must be filed
You can submit REG-16 only if all returns due on or before the effective date of cancellation have been filed.
If you have filed GSTR-1 (or used the Invoice Furnishing Facility) for a tax period, you must also file GSTR-3B for that same period.
Step 2: "Pending for Returns Filing"
Some returns may relate to periods before the cancellation date but not yet be due. In that case the application moves to "Pending for Returns Filing", and you must file those returns by their due dates.
- Filed on time: processing continues automatically.
- Not filed on time: the application goes to the jurisdictional officer.
Step 3: Who gets automatic approval
| Taxpayer type | What happens |
|---|---|
| Composition, Non-Resident Taxable Persons, OIDAR, Input Service Distributors | Cancelled electronically, without an officer |
| Regular, Casual, SEZ, with output tax liability (OTL) of ₹2.5 lakh or less in every tax period | Cancelled electronically, without an officer |
| Regular, Casual, SEZ, with OTL above ₹2.5 lakh in any tax period | Must file GSTR-10 within 3 days (see below) |
The 3-day GSTR-10 rule
If your tax liability crossed ₹2.5 lakh in any period, you must file the final return, GSTR-10, within three days:
- counted from the due date of the returns in the "Pending for Returns Filing" stage, or
- if that stage didn't apply, from the date you submitted REG-16.
The application waits at "Pending for Final Return". File GSTR-10 in time and the cancellation is approved electronically; miss it and the application goes to the officer.
If an officer ends up cancelling your registration, you still need to file GSTR-10 within 90 days of the effective date of cancellation, as before.
What you should do
- File every pending GSTR-1 and GSTR-3B before applying.
- Check whether your tax liability crossed ₹2.5 lakh in any period. If it did, have GSTR-10 ready to file straight away.
- Track the application status on the portal so you don't miss a due date.
