Updated on June 19, 2025 02:53:20 PM
When a sole proprietor (a person who owns and runs a business alone) passes away, their family or legal representatives need to manage the Goods and Services Tax (GST) registration linked to the business. They have two main choices: canceling the GST registration or transferring it to a successor who will continue the business. Each option requires specific steps and documents to follow the law properly. Handling these tasks can be complex, so seeking help from experts like Professional Utilities can make the process easier and ensure everything is done correctly. We specialize in services such as GST registration and filing, making them a valuable resource during this challenging time.
Table of Content
When a sole proprietor registered under GST passes away, the legal heirs or representatives have two possible options:
GST registration Cancellation: If the sole proprietor dies, the representatives or legal heirs must apply to cancel the GST registration by submitting Form GST REG-16 on the GST Portal.
Business Transfer: The representatives or legal heirs are eligible to apply for transfer of GST registration in the event of the death of a sole proprietor by filing an application to the office of the Proper (Jurisdiction) Officer for becoming an authorized signatory.
When a sole proprietor passes away, legal heirs or representatives manage the Goods and Services Tax (GST) registration linked with the business. Depending on whether they choose to cancel the GST registration or transfer the business, specific documentation is required to ensure compliance with GST regulations.
When a sole proprietor passes away, it's important to handle, the Goods and Services Tax (GST) registration associated with their business. The legal heirs or successors have two primary options: canceling the GST registration or transferring the business.
If the decision is to discontinue the business, the GST registration must be canceled. Follow these steps:
If the legal heir or successor chooses to continue the business, obtaining a new Goods and Services Tax (GST) registration is essential. The following steps should be taken:to transfer the business:
When a sole proprietor dies, and their business is taken over by a legal heir or successor, certain tax responsibilities and benefits can be transferred to the new owner.
Conclusion
Taking care of GST registration after the death of a sole proprietor is a crucial responsibility for the family or legal representatives. Whether deciding to cancel the registration or transfer it to a successor, following the correct procedures and gathering the necessary documents is essential to comply with the law. Getting assistance from professionals like Professional Utilities can simplify the process, reduce stress, and help ensure that all legal requirements are met efficiently.
At Professional Utilities, we leverage our industry knowledge and expertise to help businesses navigate complex regulations, minimize risks, and optimize operations for maximum efficiency and profitability.
If the business is continued by the legal heir/representative then the heir/representative will be liable for the due amount under GST. If the business is discontinued after death, the legal heir will be responsible for paying the due amount.
Once the owner dies, the legal heir needs to go to the GST department and provide the death certificate and succession certificate. GST officer will make the legal heir an authorized signatory. In case the successor is minor, he cannot be made an authorized signatory.
In the case of the death of a sole proprietor, the business may be canceled or transferred to the legal heirs or a new proprietor. Transfer of business on the death of a sole proprietor involves procuring legal certificates, transfer of assets and liabilities, and seeking transfer of ITC.
Legal heir must make new registration. After the new registration is granted, the Legal heir must apply for the transfer of ITC by making FORM GST ITC–02 to the new entity. But there is no bar on the filing of ITC-02 before or after cancellation.
Death of the sole proprietor is one such situation. Cancellation requests can be done via Form GST REG-16. Just make sure that "death of sole proprietor" is marked as the reason for cancellation. Also, specify both the GSTINs of the transferor and the transferee.
To transfer proprietorship from father to son, the son must submit the succession certificate and death certificate to the office of the respective officer as evidence, and other required documents, and follow the procedures required for the transfer of business.
Cancellation of GST registration: Legal heirs or representatives can apply for cancellation of GST registration if a sole proprietor dies. In such a case, the legal heirs or representatives must apply to cancel the GST registration by filing Form GST REG-16.
To cancel GST, you must need the following documents:
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