Understanding the Invoice Management System (IMS) under GST: Essential Dates and Implementation Schedule
The Invoice Management System (IMS) under GST, launched by GSTN on October 1, 2024, streamlines invoice reconciliation between recipients and suppliers on the GST portal. It simplifies amendments, reduces input tax credit errors, and enhances communication by allowing recipients to accept, reject, or pending transactions in Form GSTR-2B. This system significantly improves GST compliance by automating ITC claims and ensuring accurate record reconciliation based on supplier declarations.
The Invoice Management System (IMS), introduced by the Goods and Services Tax Network (GSTN) on the GST portal, became effective on October 1, 2024. Its purpose is to enhance communication between recipients and suppliers through additional document reconciliation and verification layers. The IMS also aims to simplify invoice amendments, reduce errors in input tax credit claims, and streamline the reconciliation of input tax.
Timeline of IMS Implementation
The IMS was rolled out on the GST portal on October 1, 2024. Taxpayers can begin reviewing their received invoices and other relevant records starting October 14, 2024.
Key Dates for IMS under GST
The following table summarizes essential dates and communications from the GSTN related to the IMS functionality:
| Date | Topic | Purpose |
|---|---|---|
| 1st February 2025 | Govt via Union Budget recommended to change section 38(1) to omit the expression "autogenerated for GSTR-2B | |
| 16th November 2024 | Important advisory on GSTR 2B and IMS | Issued to help taxpayers navigate when GSTR-2B for October-2024 was not generated on 14th November, 2024 |
| 13th November 2024 | Advisory on IMS on Supplier View | Supplier View functionality was made available on the GST portal |
| 12th November 2024 | Advisory regarding IMS during the initial phase of its implementation | Provided clarity on certain issues encountered by taxpayers while using the IMS |
| 17th October 2024 | Additional FAQs on IMS | Gave taxpayers a better understanding of the IMS |
| 14th October 2024 | Attention - Advisory on IMS | Provided taxpayers with a better understanding of the IMS |
| 1st October 2024 | NA | Launch of IMS |
| 22nd September 2024 | Frequently Asked Questions on IMS | |
| 17th September 2024 | Draft Manual on Invoice Management System | A step-by-step procedure guiding taxpayers on the usage of the IMS |
| 3rd September 2024 | Introduction of IMS | Introduced IMS as a new communication process |
How IMS Affects GST Filing
A draft Form GSTR-2B becomes available to recipients on the 14th of each month. This draft is compiled from transactions reported by suppliers in Form GSTR-1, Form GSTR-1A, or the Invoice Furnishing Facility (IFF). Recipients have three options for each transaction: accept, reject, or leave pending.
- Accept: When a transaction is accepted, its corresponding input tax credit moves to the "ITC Available" section of Form GSTR-2B and is automatically reflected as eligible ITC in Form GSTR-3B.
- Reject: If a transaction is rejected, the ITC is moved to the "ITC Rejected" section of Form GSTR-2B, preventing any automatic credit population in Form GSTR-3B.
- Pending: Transactions left pending remain within the IMS and do not appear in Form GSTR-2B. These transactions must eventually be accepted or rejected within the deadline specified under Section 16(4) of the Central GST Act. Until an action is taken, no ITC for these transactions is auto-populated in Form GSTR-3B.
Records are deleted from the IMS once the statutory deadline passes. If a recipient fails to act within the IMS before Form GSTR-2B is generated, the transaction is automatically considered accepted. Consequently, the associated ITC is included as an eligible credit in Form GSTR-3B by default.
Important Notes:
- If Form GSTR-3B for the previous period has not been filed, the IMS will not generate the draft Form GSTR-2B on the 14th day of the subsequent month.
- After Form GSTR-2B is generated based on recipient actions and Form GSTR-3B is filed for a tax period, accepted or rejected records for that period are removed from the IMS. Only pending records and those pertinent to future tax periods remain in the IMS.
The IMS has significantly altered how taxpayers interact with invoices. It has streamlined GST compliance by enabling taxpayers to manage invoices through acceptance, rejection, or deferral. This system allows recipients to reconcile their records with supplier-issued documents (GSTR-1, GSTR-1A, or IFF), ensuring accurate ITC claims. Accepted invoices are automatically imported into the recipient’s Form GSTR-2B, while rejected ones are excluded, enhancing the precision of ITC claims. The IMS represents a considerable advancement in simplifying reconciliation and minimizing errors for businesses, fostering more efficient adherence to GST filing requirements.