Are you planning to sell your business or close it? If yes, then you must also cancel your GST registration.
Along with this, you may also have to cancel your GST registration if there are changes in the business structure.
When You Should Cancel Your GST Registration?
If you’re considering cancelling your GST registration, there are a few important factors to keep in mind.
Firstly, if you’ve sold or closed your business in Melbourne, or if there’s been a change in your business structure, such as transitioning from a partnership to a company, you’re required to cancel your GST registration within 21 days.
Additionally, if your GST turnover falls below the compulsory registration threshold, you have the option to cancel your registration.
However, there are exceptions to this rule.
If you’re a taxi driver, represent an incapacitated entity, or act as an agent for a non-resident entity registered for GST, you may not be eligible to voluntarily cancel your registration.
What Are the Effects of Cancelling Your GST Registration on Other Registration?
If you’re temporarily pausing or permanently closing your business, it’s essential to continue meeting your tax and superannuation obligations, including lodgment, reporting, and payment requirements.
When you decide to cancel your GST registration, it’s important to note that some of your other registrations may also be affected, although not all of them.
Cancellation of your GST registration will automatically result in the cancellation of your registrations for the following:
- fuel tax credits,
- luxury car tax (LCT), and
- wine equalisation tax (WET)
However, you’ll still be required to lodge activity statements if you’re registered for pay-as-you-go (PAYG) withholding, participating in PAYG instalments, or have fringe benefits tax (FBT) obligations.
GST Registration Cancellation Date
The date you select to cancel your GST registration should be the final day you wish to remain registered.
Normally, the ATO (Australian Taxation Office) processes your GST registration cancellation from the chosen date. However, there are some important points to remember:
- You cannot cancel your registration retrospectively if you are still conducting business under a GST-registered status after the chosen cancellation date.
- After your cancellation date, you must cease operating under a GST-registered status.
- Cancellation is not permitted if you’ve already submitted an activity statement covering the period, including the cancellation date.
How Can You Cancel Your GST Registration?
To cancel your GST registration, along with any associated roles or registrations, you have several options:
- Use Online services for business, accessible through the ATO website.
- Contact the ATO by phone at 13 28 66 during their operating hours, which are 8:00 am to 6:00 pm, Monday to Friday.
- Engage your registered tax or BAS agent to handle the cancellation process on your behalf.
- Complete the Application to cancel registration (NAT 2955) form, which can be obtained through online ordering, and mail it to the ATO.
For registered tax agents, the Online services provide a platform to update or cancel a client’s tax registration conveniently.
Frequently Asked Questions About Cancelling Your GST Registration
When do I need to cancel my GST registration?
You must cancel your GST registration if you sell or close your business or if your business structure changes, such as changing from a sole trader to a company. In most cases, you should do this within 21 days.
Can I cancel my GST registration if my turnover falls below the threshold?
Yes. If your GST turnover falls below the compulsory registration threshold, you can generally choose to cancel your GST registration. However, some businesses, such as taxi and ride-sourcing services, must remain registered.
What happens after I cancel my GST registration?
Once your GST registration is cancelled, you can no longer charge GST on your sales, claim GST credits on purchases, or issue tax invoices that include GST. You will also need to complete your final Business Activity Statement (BAS).
Do I need to lodge a final BAS after cancelling GST?
Yes. You must lodge a final BAS covering the tax period up to your GST cancellation date. Your final BAS may also include adjustments for business assets you keep after cancelling your registration.
Can I still claim GST credits after cancelling my registration?
Generally, no. Once your GST registration is cancelled, you cannot claim GST credits for purchases made after the effective cancellation date.
Does cancelling my GST registration also cancel my ABN?
No. Cancelling your GST registration does not automatically cancel your Australian Business Number (ABN). If your business has permanently ceased, you may also need to cancel your ABN separately.
Can I re-register for GST later?
Yes. If your business grows and you become required to register again, or you choose to register voluntarily, you can apply for a new GST registration through the ATO.
What if I continue charging GST after cancelling my registration?
You should not charge GST once your registration has been cancelled. Continuing to do so may lead to compliance issues with the ATO and could require you to refund incorrectly charged GST.
Do I need to cancel other tax registrations when I cancel GST?
Possibly. Depending on your circumstances, you may also need to review registrations such as PAYG withholding, Fringe Benefits Tax (FBT), Luxury Car Tax (LCT), Wine Equalisation Tax (WET), or Fuel Tax Credits.
Can my accountant or BAS agent cancel my GST registration for me?
Yes. A registered tax agent or BAS agent can lodge the cancellation on your behalf and help ensure your final BAS and any outstanding tax obligations are completed correctly.
Are there any GST adjustments when cancelling my registration?
Yes. If you keep business assets, trading stock, or other items after cancelling your GST registration, you may need to make GST adjustments in your final BAS to account for those assets.
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