GSTN Activates Withdrawal Facility For Small Taxpayers To Opt Out Of Simplified Registration Option
As of 21 February 2026, the Goods and Services Tax Network (GSTN) has activated the facility to file Form GST REG-32 for taxpayers who wish to opt out of registration under Rule 14A of the Central Goods and Services Tax (CGST) Rules.
To mitigate compliance burdens, as part of the 'Next Generation GST Reforms', a Simplified GST Registration Scheme for Small and Low-Risk Businesses under Rule 14A was introduced in 2025.
Rule 14A provides a simplified registration option for small and low-risk taxpayers who, on self-assessment, expect that their monthly GST liability on supplies made to other registered businesses (B2B supplies) will not exceed Rs. 2.5 lakh. The Rs. 2.5 lakh threshold refers to the amount of tax payable, including CGST, SGST/UTGST, IGST and Compensation Cess, and not turnover.
GSTN has now enabled filing of Form GST REG-32 to opt out from Rule 14A. After logging in, the Application for Withdrawal from Rule 14A in Form GST REG-32 will be visible only if the taxpayer is registered under Rule 14A and is active.
After logging in, the Application for Withdrawal from Rule 14A in FORM GST REG-32 will be visible only if the taxpayer is registered under Rule 14A and is active.
Who Can Apply?
Active registered Taxpayers
How To Apply?
Services -> Registration -> Application for Withdrawal from Rule 14A -> Enter Reason For Withdrawal
Pre-Conditions
All pending returns must be filed, and a minimum lock-in period must be met. This includes 3 months before 1 April 2026 and if the Form REG-32 is filed later then returns for at least one tax period.
All returns due from the effective date of registration up to the date of filing Form GST REG-32 must be filed.
Aadhar Authentication
Taxpayer will have to undergo either OTP based Aadhaar authentication or Biometric based Aadhaar Authentication.
Aadhar Authentication of Primary Authorised Signatory is mandatory or atleast of one Promoter/Partner (where applicable).
Timelines
Draft application must be completed within 15 days of creation and Aadhar Authentication must be completed within 15 days of submission.
Restrictions
Pending GST REG-32, Taxpayer cannot file Core amendment, non-core amendment and Self-cancellation application.
Next Steps After Opt-Out
If the application is approved, an order will be issued in Form GST REG-33 allowing withdrawal from Rule 14A. From the first day of the succeeding month in which the order is issued, the taxpayer shall be able to furnish details of output tax liability on supplies made to registered persons exceeding Rs.2.5 lakh.
To read about the process flow for 'OPT-OUT' click here.