The Goods and Services Tax (GST) is a comprehensive indirect tax that has replaced several indirect taxes in India. The introduction of GST has brought about significant changes in the way businesses operate. However, in some cases, taxpayers may want to revoke their GST registration. In this article, we will explore the reasons for GST revocation, the procedure for revocation, and the implications of GST revocation.
What is GST Revocation?
GST revocation is the process of canceling the GST registration of a taxpayer. Once GST registration is revoked, the taxpayer is no longer liable to collect or pay GST. GST revocation is different from GST surrender, which is the process of giving up GST registration voluntarily.
Reasons for GST Revocation
There are two types of GST revocation – voluntary and mandatory.
A taxpayer may choose to revoke their GST registration voluntarily for the following reasons:
- The business has been shut down or transferred to another person.
- The business turnover has fallen below the threshold limit of Rs. 20 lakhs for normal taxpayers and Rs. 10 lakhs for special category states.
- The business is no longer engaged in taxable activities.
The GST registration of a taxpayer may be revoked mandatorily for the following reasons:
- The taxpayer has contravened the GST provisions.
- The taxpayer has not filed GST returns for a continuous period of six months.
- The taxpayer has not commenced business within six months of obtaining GST registration.
Procedure for GST Revocation
The procedure for GST revocation is as follows:
- Login to the GST portal using valid credentials.
- Navigate to the ‘Services’ tab and click on ‘Application for Revocation of Cancelled Registration’.
- Fill in the required details in the form and upload the necessary documents.
- Submit the application.
- The GST officer will verify the details provided in the application and may request additional information if necessary.
- Once the GST officer is satisfied with the information provided, they will pass an order for revocation of GST registration.
Implications of GST Revocation
Once GST registration is revoked, the taxpayer is no longer required to collect or pay GST. However, there are a few implications that taxpayers should be aware of.
Payment of Tax and Other Dues
If the taxpayer has any outstanding tax liability or other dues, they must clear them before applying for GST revocation. Failure to do so may result in the application being rejected.
Recovery of Input Tax Credit (ITC)
If the taxpayer has any unutilized ITC, they may lose it upon revocation of GST registration. Therefore, taxpayers should ensure that they have utilized all their ITC before applying for GST revocation.
GST revocation is a process that allows taxpayers to cancel their GST registration. There may be various reasons why a taxpayer may want to revoke their GST registration, and the procedure for revocation is relatively simple. However, taxpayers should be aware of the implications of revoking GST registration, such as the payment of tax and other dues and the recovery of input tax credit.