GSTR 10 Filing Process Explained: Legal Framework and Compliance Requirements

When a business decides to discontinue operations and cancel its GST registration, the compliance journey does not end with cancellation. One of the most critical post-cancellation obligations is filing the GSTR-10 return, commonly referred to as the GSTR-10 final return. This return formally concludes the taxpayer’s responsibilities under GST and ensures that all outstanding liabilities are settled in accordance with the law.

This article provides a comprehensive yet easy-to-understand overview of the GSTR 10 filing process, including the GSTR 10 due date, GSTR 10 applicability, legal provisions, penalties, and how to cancel GST registration. It also explains how professional assistance from TMWala can simplify this process and ensure complete GST compliance requirements.

Understanding the GSTR 10 Return

The GSTR 10 return is a statutory return required to be filed by taxpayers whose GST registration has been cancelled or voluntarily surrendered. It acts as a GST cancellation return and serves as a declaration that no further taxable activities will be carried out under that registration.

This final return after cancellation of GST registration ensures that:

• All tax liabilities are properly discharged
• Details of closing stock are declared
• Any reversal of input tax credit, if applicable, is completed
• The government records reflect the closure of GST obligations

The requirement to file this return arises under Section 45 of the CGST Act, which mandates that every registered person whose registration has been cancelled must furnish a final return within the prescribed timeline.

GSTR 10 Applicability: Who Needs To File?

Understanding GSTR 10 applicability is essential to avoid non-compliance. The return must be filed by individuals or entities whose GST registration has been cancelled or surrendered.

However, certain categories of taxpayers are not required to file the GSTR 10 return, such as:

• Input Service Distributors (ISD)
• Composition scheme taxpayers
• Non-Resident Taxable Persons (NRTP)
• Persons liable to deduct TDS under Section 51
• Persons liable to collect TCS under Section 52

All other regular registered taxpayers must file the final return after cancellation of GST registration if their GSTIN has been cancelled.

Section 45 of the CGST Act

As per Section 45 of the CGST Act, any registered person required to file returns under Section 39(1) and whose registration has been cancelled must submit a final return within three months from the date of cancellation or from the date of the cancellation order, whichever is later.

This provision makes the GSTR 10 filing process a mandatory legal obligation and not merely a procedural formality.

GSTR 10 Due Date

The GSTR 10 due date is within three months from:

• The date of cancellation of GST registration, or
• The date of receipt of the cancellation order, whichever is later

For example, if the registration was cancelled on 1 January 2025 and the cancellation order was received on 5 January 2025, the GSTR 10 due date would be 5 April 2025.

Missing this deadline may result in notices and financial consequences, making timely compliance crucial.

Step-by-Step GSTR 10 Filing Process

The GSTR 10 filing process is conducted entirely online through the GST portal. Here is a simplified breakdown:

1. Log in to the GST Portal: Access the official GST portal using your credentials and navigate to Services > Returns > Final Return.
2. Provide Basic Details: The system will auto-populate basic information such as GSTIN, legal name, and business address. You must confirm these details.
3. Enter Effective Date of Cancellation: Provide the date from which your GST registration stands cancelled.
4. Declare Closing Stock: You must declare details of closing stock held on the date of cancellation. This includes:
   • Inputs
   • Semi-finished goods
   • Finished goods
   • Capital goods

Based on these details, tax liability is calculated. This may require reversal of input tax credit on stock and capital goods.

5. Offset Liability: The liability can be paid using:
   • Electronic Cash Ledger
   • Electronic Credit Ledger
   • A combination of both
6. Verification and Submission: After reviewing all information, verify the declaration and submit the form using either a Digital signature certificate, GST, or Aadhaar-based Electronic Verification Code (EVC).

Upon successful submission, an Application Reference Number (ARN) is generated.

Businesses looking to file GST returns online often benefit from professional support. TMWala can manage the entire GSTR 10 filing process, ensuring accuracy in stock declaration and ITC reversal calculations.

GSTR 10 Penalty and Consequences of Non-Filing

Failure to file the GSTR 10 return within the prescribed timeline can lead to serious consequences.

If the return is not filed by the GSTR 10 due date, the department may issue a notice providing 15 days to comply. Continued failure may result in:

• Final order determining tax liability
• Additional interest and penalties
• Recovery proceedings

Although specific GSTR 10 late fees may vary depending on circumstances, non-compliance can increase financial exposure due to accumulated interest and assessed liabilities.

To avoid GSTR 10 penalty risks, businesses should ensure timely filing and proper documentation.

How to Cancel GST Registration

Before filing the GSTR 10 return, the GST registration must be formally cancelled. Understanding how to cancel GST registration is equally important.

The process involves:

1. Logging into the GST portal
2. Navigating to Services > Registration > Application for Cancellation of Registration
3. Filling in basic details
4. Selecting the appropriate reason for cancellation

Depending on the reason selected, you may need to:

• Declare stock details
• Provide transferee GSTIN (in case of business transfer)
• Enter the date of cessation
• Calculate tax liability on stock

After completing all sections, verify the application using a Digital Signature Certificate, GST, or EVC. Once submitted, an ARN is generated, and the tax officer reviews the application. For more information, visit: Cancellation of Registration

In cases of Surrender of GST registration, businesses must be especially cautious about correct stock valuation and reversal of input tax credit. TMWala assists in preparing accurate cancellation applications and ensures that the transition to closure is smooth and compliant.

Reversal of Input Tax Credit

One of the most critical elements in the GST cancellation return is the reversal of input tax credit. When registration is cancelled, ITC claimed on inputs, semi-finished goods, finished goods, and capital goods remaining in stock must be reversed.

The amount payable is calculated based on:

• ITC availed on such goods, or
• Tax payable on transaction value, whichever is higher

Incorrect computation may trigger departmental scrutiny or additional GSTR 10 penalty exposure. Professional review helps mitigate such risks.

Importance of Timely Compliance

The final return after cancellation of GST registration is not merely procedural. It ensures:

• Clean closure of tax records
• Avoidance of future notices
• Prevention of unexpected liabilities
• Proper completion of GST compliance requirements

Ignoring the GSTR 10 filing process may result in legal and financial complications long after business closure.

Conclusion

The GSTR 10 return plays a vital role in formally closing GST obligations. Mandated under Section 45 of the CGST Act, it must be filed within the prescribed GSTR 10 due date to avoid notices and penalties. From understanding GSTR 10 applicability to managing reversal of input tax credit and ensuring proper Surrender of GST registration, each step demands careful attention.

A well-executed GSTR 10 filing process not only fulfils legal requirements but also safeguards businesses from future disputes. By seeking expert guidance from TMWala, businesses can confidently complete the final return after cancellation of GST registration and ensure full compliance with GST requirements.

FAQs

1. What is the GSTR 10 return?
   It is the final return filed after cancellation of GST registration to close tax liabilities.
2. Who must file the GSTR 10 final return?
   All regular taxpayers whose GST registration is cancelled, as per GSTR 10 applicability, except ISD, composition dealers, NRTP, TDS, and TCS deductors.
3. What is the GSTR 10 due date?
   Within three months from the date of cancellation or cancellation order, whichever is later.
4. Which law mandates GSTR 10?
   It is required under Section 45 of the CGST Act.
5. What is included in the GSTR 10 filing process?
   Declaration of cancellation details, closing stock, and reversal of input tax credit.
6. Is the reversal of input tax credit compulsory?
   Yes, it must be completed while filing the final return after cancellation of GST registration.
7. What if GSTR 10 is not filed on time?
   It may lead to notice, GSTR 10 late fees, and GSTR 10 penalty.
8. How to cancel GST registration?
   Apply online through the GST portal before filing the GST cancellation return.
9. Can I file the GST return online for GSTR 10?
   Yes, the entire process is online.
10. How can TMWala help?
    TMWala assists with the surrender of GST registration and ensures compliance with GST requirements.