What Does It Mean to Deregister for GST?

What Does It Mean to Deregister for GST?

In Singapore, businesses that are registered under the goods and services tax (GST) regime with the Inland Revenue Authority of Singapore (IRAS) may sometimes choose – or be required – to cancel their GST registration. Deregistering for GST means the business will no longer charge GST on its sales and will also no longer claim input tax credits on its purchases. 

This step can arise because the business has ceased operations, its annual taxable turnover has fallen below the threshold, or there has been a change in legal structure. 

Why Consider GST Deregistration?

When it’s compulsory

You must apply to cancel your GST registration if any of the following apply:

• You have stopped making taxable supplies and do not intend to do so in future. 
• Your business has ceased operations. 
• Your business is transferred as a whole to another person. 
• Your business entity has changed (for example, from a sole-proprietorship to a company). 

When voluntary deregistration may apply

If your business no longer needs to be GST-registered, you may choose to deregister. For instance:

• Your annual taxable turnover has dropped below S$1 million and you don’t reasonably expect it to exceed that in the next 12 months. 
• If your registration was originally voluntary, you must have been registered for at least 2 years before you can cancel. 

Pros and cons

Advantages:

• Reduced administrative burden — no more routine GST filings, less tracking of GST input/output. 
• Potentially simpler accounting and lower compliance costs.

Disadvantages:

• Once deregistered, you lose the ability to claim input tax credits on purchases. That can increase costs if you still have significant business expenses. 
• Some clients or business partners may prefer working with GST-registered suppliers (so you might lose some credibility or business opportunities). 
• If your business later expands and crosses the threshold again, you’ll need to re-register and resume GST obligations.

How to Cancel Your GST Registration in Singapore

Here’s a step-by-step overview of the deregistration process:

1. Determine your eligibility – Are you no longer making taxable supplies, or is your turnover below the required threshold? Refer to IRAS rules. 
2. Submit the cancellation application – You log in to the myTax Portal and apply for cancellation of GST registration. Most online applications are approved the same day, though some may take 1 to 10 working days. 
3. Effective date of cancellation – You will be notified of the approval and the effective date. From the effective date you must stop charging GST, issuing tax invoices, etc. Until that date you must still act as a GST-registered person. 
4. File your final GST return (Form GST F8) – You are required to file your last GST return covering up to the last day of your registration. Any outstanding returns must also be submitted. 
5. Account for GST on assets and supplies – On the final return, if you held business assets (for which you claimed input tax) above certain thresholds on the last day of registration, you must account for output tax. Also, supplies made before cancellation but invoiced or paid after cancellation need to be accounted for.
6. Record-keeping – Even after cancellation, you must keep business and GST records for at least 5 years. 

Key Things to Look Out For

• Make sure your calculation of “taxable turnover” is correct. Note that certain supplies (like exempt supplies) may not count. 
• If you change business structure (e.g., sole-proprietorship → company), you may need to cancel and re-register. 
• Don’t assume deregistration means you no further obligations. Final return, GST on assets, record-keeping still apply.
• Voluntary deregistration may still require you to stay registered for a minimum time (e.g., 2 years). 
• Consider potential future growth — if you deregister and then cross the threshold again you’ll need to re-register, which may involve back‐dating and cost.
• Loss of input tax credit can affect your cost base — make sure you model the financial impact.

When to Seek Professional Assistance (from WLP)

Working through GST deregistration can be more complex than it looks. Engaging a professional accounting or tax firm such as WLP makes sense when:

• You’re unsure whether your turnover qualifies you for deregistration (or whether you’re still liable).
• There are business assets (fixed assets, inventory) on your books and you need to account for GST on them properly.
• You’ve made taxable supplies that straddle your deregistration date (e.g., service delivered before cancellation date but invoice/payment after).
• Your business structure is changing (e.g., you’re converting the legal entity) which may trigger compulsory cancellation.
• You want to ensure continued compliance with the record-keeping obligations and avoid penalties.
• You want to model the financial impact of removing GST registration (especially loss of input tax, pricing implications, client relationships).

In short: deregistering GST is not merely filling a form. It requires good understanding of timing, asset accounting, how your business will operate post-deregistration and ensuring you meet all final duties. A specialist can help you manage the process smoothly and avoid costly mistakes.

Summary

Deregistering for GST in Singapore is a significant move for any business. While it can simplify your administrative load and reduce compliance costs, it comes with trade-offs — including loss of input tax claims and the need to correctly account for all final obligations. Understanding the rules from IRAS, evaluating the financial implications and getting help from an accountant like WLP can make the transition far smoother.