GST rules on cancelling and suspending registration rewritten
What changed. The CGST (Amendment) Rules, 2026 substitute rules 20, 21, 21A and 22 and insert rule 23A.
- Cancellation on request (rule 20). The application in FORM GST REG-16 must be filed within thirty days of the event (not applicable on the death of a sole proprietor). All returns due up to the date from which cancellation is sought must be filed first, and where GSTR-1 or IFF has been filed for a period, GSTR-3B for that period too. Registration stays suspended until the application is decided. The portal cancels it automatically (FORM GST REG-38) where returns and dues are cleared and either output tax on B2B supplies never exceeded ₹2,50,000 in any month or GSTR-10 is filed within three days of its due date. Other cases go to an officer, with fifteen-day time limits and deemed approval if the officer does not act.
- Grounds (rule 21). Include non-filing of returns for six continuous months (monthly filers) or two continuous tax periods (quarterly filers), and failure to furnish bank details under rule 10A.
- From 1 April 2027 (rules 21A, 22, 23A). The portal may suspend registration for these defaults after a thirty-day intimation in FORM GST REG-31. If the default is not cured within thirty days of suspension, registration is deemed cancelled. It can be revoked through FORM GST REG-21 within 180 days once the pending returns or bank details are filed.
Who it affects. All GST-registered businesses, especially those closing, restructuring or behind on returns.
From when. Rules 20 and 21: 1 November 2026. Rules 21A, 22 and 23A: 1 April 2027.
What to do. File pending returns before applying for cancellation, apply within thirty days of closure, and keep bank details updated on the portal.
Official source: CBIC Notification No. 05/2026–Central Tax dated 26 October 2026 (CGST (Amendment) Rules, 2026)
This is general information based on the law as on the date shown, not professional advice. Rules change often; check the current position before acting.