GSTN introduces New Communication process to facilitate ITC Reconcilliation

The Goods and Services Tax Network (GSTN) has issued an Advisory on the Invoice Management System.

To allow taxpayers to effectively resolve invoice corrections/ amendments with their suppliers via the portal, a new communication procedure known as the Invoice Management System (IMS) is being introduced.

This could also help taxpayers in matching their records/invoices vis a vis provided by their suppliers for utilizing the right Input Tax Credit (ITC) and shall allow recipient taxpayers to either accept or reject an invoice or keep it pending in the system, which can be claimed later.

The proposed functionality will be a significant boost to the GST ITC ecosystem. Only accepted invoices by the recipients will now be included in their GSTR-2B as qualifying ITC. As a result, IMS will allow taxpayers to verify the legitimacy and authenticity of invoices received. When suppliers save an invoice in GSTR 1 / IFF / 1A, the recipient’s IMS dashboard will reflect the same invoice.

This facility shall be available to the taxpayer from 1st October onwards on the GST portal.

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