Updated : May 29, 2024Application for Surrender of GST Registration Online
Overview : The surrender of GST Registration online involves a taxpayer or his legal heir giving up their GST number before the closing or restructuring of their business. The process is quite simple. An application gets filed to the GST department with business and cancellation details. After being approved, the department cancels the registration permanently.
Surrendering GST Registration can help avoid the burden of paying taxes and filing GST returns. However, if done for the wrong reasons, it may lead to the business losing credibility in the eyes of customers and stakeholders. So, it’s necessary that the surrender is planned for the right reasons and is completed through the right process.
What is GST Registration Surrender?
GST registration surrender is the process where a taxpayer or his legal heir cancel GST Registration willingly to avoid paying taxes and filing GST returns. Though it is not compulsory, the taxpayer should be prompt in surrendering GST registration when the business is closing down or changing its identity to a new entity. Not surrendering GST registration in the right situation can lead to its forceful cancellation by the tax officers.
Reasons for Surrender of GST Registration
There can be several reasons for the surrender of GST Registration. The applicant must choose from the available options in the application form. Here are the common ones:
- Change in the constitution of business leading to a change in PAN.
- Ceased to be liable to pay tax
- Closure of Business
- Transfer of Business due to Merger, Demerger, Amalgamation
- Death of Sole Proprietor
Who can Surrender GST Registration Online?
GST Surrender Registration is both a voluntary and an involuntary process. If the owner of the GST-registered business wants to surrender the GST number online, he can apply for it stating the right reasons. Similarly, tax officers can also take a suo moto action on cancelling a GST registration on valid grounds. In either case, the impact will be the same. The business will not be eligible to pay GST or file GST returns.
How to File Application for Surrender of GST Registration?
Surrendering GST Registration is an online process where the taxpayer files an application to the GST Department in Form GST REG 16. The form contains all information about the business, reason for surrender and the details of the new entity, in case it’s being restructured. Here are the steps to be followed.
1. Access the GST Surrender Application
To access the GST surrender application, the taxpayer must log in to the GST website with correct User ID and password.
2. Fill Out the Application
The next step is completing the application with basic details of the business, reason, and the date of surrender. Additional details like GST number or stock value may be asked in certain situations.
3. Verification
The application must be verified using a DSC or EVC. DSC is compulsory if the applicant is a company or LLP. Single taxpayers like Sole proprietors may use EVC.
4. Submit the Application
The completed application can be submitted on the GST website without any surrender charges or cancellation fee.
GST Surrender Required Documents & Forms
| Forms & Documents | Purpose |
|---|---|
| GST REG-16 | Application for Surrender of GST Registration |
| GST REG-17 | GST cancellation notice from tax officers. |
| GST REG-18 | Reply to GST cancellation notice within 7 days. |
| GST REG-19 | GST Cancellation Order Issued by the Department within 30 days from application date. |
| GST REG-20 | Notice informing that no cancellation proceedings will be initiated |
| Digital Signature Certificates | Required for verification of GST Cancellation Application for Companies and LLPs. |
Can a Surrendered GST be Restored?
A surrendered GST can be restored only if it was forcefully cancelled by the tax authorities, except in case of cancellation due to non-filing of GST Returns. For this, the taxpayer has to make an application to the GST Department in form GST REG-21, within 30 days from the issue date of cancellation order. If the application gets approved, the order will be revoked within 30 days from the application date.
Conclusion
Surrendering the GST number online can help a taxpayer get rid of unnecessary compliance burden in times of financial crisis or uncertainty. The application is filed free of cost. However, the effect is permanent as a surrendered GST number cannot be revived again. So, it is advisable to go for this process only when the business is shutting down or is being changed to a new structure.
