The Goods and Services Tax Network (GSTN) has introduced a new online functionality allowing eligible taxpayers to withdraw from the option availed under Rule 14A of the CGST Rules. The facility, made available on the GST Portal from February 21, 2026, enables taxpayers registered under Rule 14A to opt out by filing Form GST REG-32, subject to prescribed conditions and compliance requirements.
The move is aimed at simplifying the compliance process and providing flexibility to taxpayers who no longer wish to remain registered under Rule 14A. The new functionality is available only to active taxpayers who have opted for registration under Rule 14A and meet the eligibility criteria laid down under GST law.
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Eligibility to Apply for Withdrawal
Active taxpayers registered under Rule 14A can apply for withdrawal in accordance with legal provisions. The option to file Form GST REG-32 will be visible on the GST Portal only if the taxpayer is currently registered under Rule 14A and holds an active registration status.
Procedure to File Application
To apply for withdrawal, taxpayers must log in to the GST Portal and navigate through the following path:
Services → Registration → Application for Withdrawal from Rule 14A
In the application form, the field titled “Option for registration under Rule 14A” will be pre-selected as “No” by default. Applicants are required to provide a valid reason for withdrawal before proceeding to Aadhaar authentication. The application must then be authenticated by the Primary Authorised Signatory and at least one promoter or partner, where applicable.
Return Filing Requirements
The facility is subject to strict compliance with return filing requirements. Taxpayers will not be permitted to file Form GST REG-32 unless they have furnished the required returns as prescribed.
If the application is filed before April 1, 2026, the taxpayer must have filed returns for at least three months. For applications filed on or after April 1, 2026, returns must be furnished for at least one tax period. In addition, all pending returns from the effective date of registration up to the date of filing the application must be submitted.
Aadhaar Authentication Requirement
Aadhaar authentication is a mandatory step in the withdrawal process. Based on system-driven risk analysis, taxpayers may be required to complete either OTP-based Aadhaar authentication or biometric authentication.
Authentication is compulsory for the Primary Authorised Signatory and at least one promoter or partner. The Application Reference Number (ARN) will be generated only after successful completion of Aadhaar authentication.
Timelines for Submission
The GSTN has prescribed strict timelines for completing the withdrawal process. A draft application must be submitted within 15 days from the date of its creation. Once submitted, Aadhaar or biometric authentication must also be completed within 15 days. Failure to complete authentication within the stipulated period will result in non-generation of the ARN, effectively invalidating the application.
Restrictions During Processing
Taxpayers should note that certain activities will be restricted while the withdrawal application is under processing. Once Form GST REG-32 is submitted and pending approval, the taxpayer will not be allowed to file applications for core amendments, non-core amendments, or self-cancellation of registration.
Post-Approval Compliance
Upon approval of the withdrawal request, an order will be issued in Form GST REG-33. After receiving the approval order, taxpayers will be required to furnish details of output tax liability on supplies made to registered persons where such liability exceeds ₹2.5 lakh.
This requirement will take effect from the first day of the month succeeding the month in which the withdrawal order is issued.
Compliance Facilitation Measure
The introduction of the opt-out facility is expected to ease compliance for businesses that initially opted for Rule 14A registration but no longer require it. By digitizing the withdrawal process and linking it with Aadhaar authentication and return compliance, GSTN aims to ensure both ease of doing business and regulatory oversight.
