GSTN issues Additional FAQs on Invoice Management System (IMS)

The Goods and Services Tax Network (GSTN) has issued an additional Frequently Asked Questions on Invoice Management System (IMS).

Invoice Management System (IMS) is now available to taxpayers. This new system shall facilitate taxpayers in matching their records/invoices vis a vis issued by their suppliers for availing the correct Input Tax Credit (ITC).

Taxpayers can now make use of this facility to seamlessly accept, reject, or keep invoices pending in the system to avail later as and when required. The first GSTR-2B on the basis of actions taken in IMS would be generated for the return period Oct 2024 on 14th November 2024.

Additional FAQ on IMS

Which invoices have been visible on the IMS dashboard since 14th Oct 2024?

IMS is launched from GSTR-2B return period of Oct’2024. Hence, all the records eligible for GSTR2B of Oct’2024 return period onwards will be made available on the IMS dashboard. All the invoices which are part of GSTR2B of Sep’24 or older return periods will not be reflecting in IMS.

Which is the first GSTR2B prepared using actions taken on IMS?

The first draft of GSTR-2B on the basis of actions taken on invoices/records in the Invoice Management System dashboard would be generated and made available to all the taxpayers on 14th Nov 2024 for the return period Oct’ 2024.

Can taxpayers take action after 14th Nov 2024 and regenerate GSTR-2B of the Oct 2024 return period?

Taxpayers can take action on the invoices/records in their IMS dashboard and recompute their GSTR-2B of Oct 2024 return period even after 14th November 2024 till the time the taxpayer files his GSTR-3B.

Is it mandatory to act on IMS? What happens if no action is taken?

It is not mandatory to act on records in the IMS dashboard for GSTR2B generation. The records where no action is taken by the recipient would be treated as accepted by the system and a GSTR-2B would be generated as it is generated presently.

When should an invoice/debit note be rejected?

Rejection of an invoice/debit note should be done very carefully as rejection will result in no ITC for the recipient.

A record may be rejected if it does not pertain to the recipient, or the detail of the record is erroneous to such an extent that CN and DN cannot handle the situation.

In light of the time limit to avail ITC being till 30th November for FY 2023-24 or furnishing of annual return whichever is earlier, how can the ITC of erroneously rejected invoice in IMS, be taken by the recipient in the FY 2023-24?

In case the recipient taxpayer erroneously rejects an invoice in IMS, then the same invoice can be accepted in IMS again before filing of GSTR-3B.

After accepting the said invoice, the recipient taxpayer should recompute the updated GSTR-2B for availing the credit in GSTR 3B for the FY 2023-24.

How can the recipient accept a genuine credit note issued by the supplier in IMS as it will result in further reduction of the recipient’s ITC, however recipient had reversed the ITC corresponding to the invoice itself because of 17(5), Rule 42, 38, 43 etc., or not availed the ITC at all because of POS or 16(4) etc., ineligibility?

In such cases, the recipient can accept the said credit note in IMS. As the recipient had already reversed the ITC, there is no need for a reversal of the ITC again in the case of such a credit note.

What action shall be available on upward amended invoice/debit notes, where the upward amended invoice/debit notes are Saved by the supplier and the same is not filed?

The recipient will not be able to take action on an upward amended invoice/debit note if the said amended record has only been saved by the supplier in GSTR-1/GSTR-1A/IFF but the same record has not been filed.

The recipient will be able to take action once the supplier files such a record.

What to do in case the wrong invoice is corrected by the issuance of a Credit Note by the supplier instead of amending the same and such Credit note has been rejected by the recipient?

In the absence of a linkage of the Credit Note with the corresponding invoices, the system cannot understand whether the original invoice for this Credit Note was accepted or rejected.

Therefore, if the invoice is not correct, then it is advisable to rectify the mistake through amendment of invoices in GSTR 1 instead of issuance of a Credit Note.

Can the Credit Note be kept as pending in IMS? If not, then why?

Credit Note cannot be kept pending in the IMS by the recipient as the supplier has reduced its outward tax liability at the time of issuance of a credit note.

IMS does not change the existing flow where the documents/records reported by the supplier in the GSTR-1 are accepted and the corresponding impact is reflected in the GSTR 2B. Now because of IMS, an additional option has been provided to the recipient to reject the credit note if it does not belong to him.

Whether Liability can be added in the same GSTR 3B in case where credit note has been rejected by the recipient before the filing of GSTR 3B by the supplier?

No, if a credit note is rejected by the recipient, the liability of the supplier is increased on the portal to that extent in GSTR-3B of the subsequent tax period and not in GSTR 3B of the same tax period.

FAQs on Invoice Management System (IMS)

What is an Invoice Management System (IMS)?

Invoice Management System (IMS) is a facility in the GST system, where the invoices/records saved/filed by the supplier in GSTR-1/1A/IFF, can be accepted, rejected or kept pending by recipients in order to correctly avail ITC.

How can I access IMS?

IMS can be accessed using the below path on the GST Portal: Dashboard > Services > Returns > Invoice Management System (IMS) Dashboard.

When will IMS be made available to taxpayers?

IMS will be launched on the GST Portal from 1st October 2024 and shall be available to the taxpayers for taking action on the received invoices/records from 14th October 2024 onwards.

What records will be available in IMS for taking action?

All the saved or filed original invoices/records and their amendments by suppliers through GSTR1/1A/IFF will be available to the recipient for action in IMS. However, the documents where ITC is not eligible either due to:

i. POS rule or
ii. Section 16(4) of the CGST Act,

will not appear on IMS and will directly go to the ‘ITC Not Available’ section of GSTR-2B.

What will happen to the accepted and rejected records?

All the accepted/rejected records belonging to a particular GSTR-2B period will be removed from IMS on filing of GSTR-3B for that particular period. Only the pending record and the invoices/records belonging to future tax periods shall remain in IMS.

When will the documents be flown to IMS?

The documents will be available in IMS as soon as they are saved by the supplier in their corresponding GSTR-1/1A/IFF.

When can the recipient taxpayer take action on a record?

As soon as a supplier/ taxpayer saves an Invoice/record in GSTR-1/1A/IFF, it is shown and is available to the recipient taxpayer in IMS for taking action.

What documents will not be made available in IMS but will be part of GSTR-2B?

The below records will not be part of IMS but will directly flow to GSTR-2B:

1. Document flowing from the following forms:

• GSTR 5
• GSTR 6

2. ICEGATE documents

3. RCM records

4. Document where ITC is ineligible due to:

• POS rules
  Section 16(4) of CGST Act

5. Documents where ITC is to be reversed on account of Rule 37A.

Who will have access to IMS functionality?

Taxpayers registered as normal taxpayers (including SEZ unit/Developer) and casual taxpayers will be able to access IMS functionality.

What are the actions that I can take on an IMS?

Below are actions allowed to be taken in IMS:

i. Accept
ii. Reject
iii. Pending

Note: By default, all the records will flow into the “No Action” category and records with “No Action” will be deemed accepted at the time of GSTR-2B generation.

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