GSTR-10 Final Return: Your Guide to Filing the Final Return Upon GST Registration Cancellation or Surrender

When a business registered under the Goods and Services Tax (GST) in India decides to cancel or surrender its registration, there are specific compliance requirements that need to be fulfilled. One of the most important of these is filing the GSTR 10, also known as the Final Return. This article will provide a comprehensive guide to GSTR-10 Final return, explaining its purpose, who needs to file it, the crucial due dates, the details required in the form, the online filing process, and the importance of complying with this final obligation.

What is GSTR-10 Final Return?

GSTR-10, or the Final Return, is a return that must be filed by every registered person whose GST registration has been cancelled or surrendered. It serves as a declaration by the taxpayer about the stock held by them on the date of cancellation or surrender of registration, along with the tax payable on such stock. Filing GSTR 10 is the final step in the GST compliance process after your registration has been terminated.

Who Should File GSTR-10?

Any registered person under GST whose registration has been cancelled by the tax authorities or who has surrendered their registration is required to file GSTR-10. This includes individuals, partnerships, companies, or any other entity that was previously registered under GST and has now ceased to be liable for registration.

Example:

“Sunrise Enterprises,” a partnership firm registered under GST, decided to close its business operations and applied for the surrender of its GST registration. Once the surrender application is approved and the registration is cancelled, Sunrise Enterprises will be required to file GSTR-10 as their final return.

Due Dates for Filing GSTR-10

The due date for filing the GSTR-10 Final Return is within three months from the date of cancellation of registration or the date of the order of cancellation, whichever is later.  

• Scenario 1: Surrender of Registration: If a taxpayer applies for surrender and the registration is cancelled on May 15, 2025, the GSTR-10 must be filed within three months from this date, i.e., by August 15, 2025.
• Scenario 2: Cancellation by Tax Authorities: If the tax authorities issue an order cancelling the GST registration on June 10, 2025, the GSTR-10 must be filed within three months from this date, i.e., by September 10, 2025.
• Scenario 3: Later Date: If the date of cancellation is May 15, 2025, and the order of cancellation is issued on June 20, 2025, the due date for filing GSTR-10 will be three months from June 20, 2025, i.e., by September 20, 2025.

It is crucial to adhere to this timeline to avoid penalties and ensure a smooth closure of your GST obligations.

Details to be Furnished in GSTR-10

The GSTR-10 form requires the following key details to be furnished:

• Basic Information: This includes the GSTIN of the person whose registration has been cancelled or surrendered, the legal name, and the trade name.
• Date of Cancellation: The date on which the GST registration was effectively cancelled.
• Order of Cancellation Details (if applicable): If the registration was cancelled by the tax authorities, the details of the cancellation order, including the order number and date, need to be provided.
• Value of Stock Held on the Date of Cancellation: This is the most important part of the return. Taxpayers need to declare the value of all inputs, semi-finished goods, and finished goods held in stock on the date of cancellation of registration. This value should be determined as per the provisions of the GST Act.
  • Example: On the date of GST registration cancellation, “Sunrise Enterprises” had the following stock: raw materials worth ₹50,000, semi-finished goods worth ₹30,000, and finished goods worth ₹70,000. The total value of stock to be reported in GSTR-10 would be ₹1,50,000.
• Amount of Tax Payable on the Stock: Based on the value of stock held, the taxpayer needs to calculate the amount of tax payable. This will typically be the input tax credit availed on such stock.
  • Example: If “Sunrise Enterprises” had availed input tax credit of ₹15,000 on the raw materials and finished goods in stock, this amount would be the tax payable as reported in GSTR-10.
• Payment Details: Details of how the tax payable is being paid (e.g., through cash ledger or credit ledger).

How to File GSTR-10 Online: Step-by-Step Guide

The GSTR-10 Final Return must be filed electronically through the GST portal. Here’s a step-by-step guide:

1. Access the GST Portal: Navigate to the official GST portal: www.gst.gov.in.
2. Login: Enter your valid username and password to log in to your GST account.
3. Go to Returns Dashboard: Once logged in, go to Services > Returns > Returns Dashboard.
4. Select Financial Year and Return Filing Period: Choose the relevant Financial Year and select the last month of your operation or the month in which the cancellation occurred. Click Search.
5. Click on Prepare Online: Under the GSTR-10 (Final Return) section, click on the Prepare Online button. This option will only be available after your GST registration has been cancelled.
6. Enter Basic Details: Verify the pre-filled basic details like GSTIN and name. Enter the date of cancellation and the order details if the cancellation was initiated by the tax authorities.
7. Provide Stock Details: Enter the value of inputs, semi-finished goods, and finished goods held in stock on the date of cancellation.
8. Calculate Tax Payable: The system may auto-calculate the tax payable based on the stock value and applicable tax rates. Verify these calculations.
9. Make Payment: If there is any tax liability, make the payment through the available options (cash ledger or credit ledger, if applicable).
10. Review and File: Carefully review all the details entered for accuracy. Once satisfied, click on the File Return button.
11. Submit with DSC or EVC: You will need to file the return using either a Digital Signature Certificate (DSC) or by using Electronic Verification Code (EVC) generated through OTP on your registered mobile number and email ID.

Importance of Filing GSTR-10

Filing the GSTR-10 Final Return is a crucial compliance requirement for businesses whose GST registration has been cancelled or surrendered. It signifies the closure of your GST obligations and ensures that you have accounted for the tax on the stock held at the time of termination of registration. Failure to file this return can lead to penalties and potential scrutiny from the tax authorities.

Consequences of Not Filing GSTR-10

Not filing the GSTR-10 Final Return within the stipulated time can result in the following consequences:

• Demand of Tax: The tax authorities may issue a demand notice for the tax payable on the stock held on the date of cancellation, even if the return has not been filed.
• Penalty: Failure to file GSTR-10 may attract penalties as per the GST Act. The specific amount of penalty can vary based on the regulations and the period of delay.
• Legal Action: In cases of continued non-compliance, the tax authorities may initiate further legal action.

Therefore, it is highly recommended to file the GSTR-10 return within the due date to avoid these repercussions and ensure a proper closure of your GST registration.

Key Takeaways

• GSTR-10 is the Final Return to be filed upon cancellation or surrender of GST registration.
• It must be filed by every registered person whose GST registration has been terminated.
• The due date is within three months from the date of cancellation or the date of the order of cancellation, whichever is later.
• The return requires details of the stock held on the date of cancellation and the tax payable on it.
• Filing is done online through the GST portal.
• Not filing GSTR-10 can lead to demand of tax and penalties.

Understanding the requirements and procedures for filing GSTR-10 is essential for any business undergoing GST registration cancellation or surrender. By ensuring timely and accurate filing, businesses can fulfill their final GST obligations and avoid potential complications. Always refer to the latest updates and notifications from the GST department for any changes in the rules and regulations.