Taxpayers are able to withdraw from the scheme through the GST Portal under Rule 14A of the CGST Rules. The request to withdraw shall be provided in FORM GST REG-32.
Overview
For eligible taxpayers, Rule 14A does contain an explicit framework for compliance. Businesses that change in tax characteristics or their operational requirements can transition from this option to regular GST compliance structure.
Eligibility for Withdrawal
Taxpayer may make an application for withdrawal when:
- The tax on the output to registered persons is more than ₹2.5 lakh a month, or
- Business should be converted to ordinary GST compliance.
Application Process
Withdrawal can be started in GST Portal:
Services → Registration → Application to Withdraw from Rule 14A.
Major steps:
- File Form GST REG-32.
- Give a justification for withdrawal.
- Where relevant, complete Aadhaar authentication.
Effective Date of Change
When Tax Authority Approvals are reached, the withdrawal becomes effective from the month after approval.
Important Considerations
Be sure all relevant returns are submitted before your REG-32. Aadhaar authentication should be done in time. Some changes can be curtailed when the application is pending.
REG-32 also facilitates the journey for taxpayers who want more flexibility in status of GST compliance. Businesses considering withdrawal and determining eligibility should consider eligibility criteria and be able to complete the procedural aspects in a prompt manner.
Source: Goods and Services Tax Network (GSTN)
