I was in a similar situation and I totally understand. If you have no plan to finish the project, its best you let your PI know earlier rather than later.
If you don’t, this will happen:
-you’ll keep pushing back working on the project by making excuses that other things that demand your time
-There will be a period of time when you feel pretty good since you wont think about the project for a while.
-your PI will randomly email you one day wanting an update. You’ll freak out since you’ll have no updates. You’ll either ignore the message or make an excuse saying you need more time.
-repeat above step. If your PI is insistent, he/she will not stop asking for project to be done. It won’t go away and the stress will only get bigger and bigger