News

Published: October 7, 2024
Updated: October 7, 2024

GST Portal Launches Invoice Management System (IMS) to Enhance Input Tax Credit Accuracy

In a pivotal advancement for the Goods and Services Tax (GST) framework, the GST Common Portal introduced the Invoice Management System (IMS) on October 14, 2024. This new system is designed to streamline the process of managing invoices for taxpayers, significantly aiding in the accurate reconciliation of Input Tax Credit (ITC).

Overview of the Invoice Management System (IMS)

The IMS is an innovative feature on the GST portal that enables taxpayers to interact with invoices issued by their suppliers. With this system, taxpayers can accept, reject, or mark invoices as pending, facilitating a more efficient way to manage ITC claims. The IMS went live on October 14, 2024, and marks a significant step towards enhancing the accuracy and efficiency of the GST system.

Key Functionalities of IMS

From October 14, 2024, taxpayers can access and review invoices submitted by their suppliers through GSTR-1, IFF, or GSTR-1A. If no action is taken on an invoice, it will automatically be considered accepted, thereby included in the taxpayer’s GSTR-2B for ITC claims. The first GSTR-2B based on actions taken via IMS will be generated on November 14, 2024, for the October return period.

Important Features of IMS

Real-Time Invoice Management: The IMS allows taxpayers to monitor and respond to invoices in real time, ensuring no valid ITC is missed or mistakenly claimed.

Inward and Outward Supplies Management: The IMS dashboard is divided into two segments: one for inward supplies (invoices from suppliers) and another for outward supplies (customer invoices), with the outward supply section to be made available shortly.

Improved ITC Accuracy: The system enables taxpayers to evaluate invoices before they are processed for ITC claims. Accepted invoices contribute directly to the ITC computation in GSTR-2B, while rejected invoices are excluded from the ITC pool.

Deemed Acceptance: If taxpayers choose not to act on invoices, the system automatically considers them accepted, integrating them into GSTR-2B for the subsequent month.

Flexibility in GSTR-2B Recalculation: Taxpayers have the option to adjust their invoicing actions even after the draft GSTR-2B is generated. However, any changes made after the 14th of the month will require recalculating GSTR-2B before submitting GSTR-3B.

How to Access and Use the IMS

To utilize the IMS, taxpayers need to log into the GST portal and navigate to Services > Returns > Invoice Management System (IMS). They can view all available invoices and filter them based on various parameters, including GSTIN and invoice date. Taxpayers can then choose to accept, reject, or mark invoices as pending, either individually or in bulk, and must save their selections to confirm.

Additionally, the IMS offers an Excel download option, allowing taxpayers to review their invoices offline for easier management.

The launch of the Invoice Management System on the GST portal represents a significant step towards optimizing the management of invoices and enhancing the accuracy of ITC claims for taxpayers. By streamlining the invoice reconciliation process, the IMS is expected to reduce errors and improve compliance within the GST framework. Accordingly, this initiative not only simplifies the taxpayer's responsibilities but also strengthens the overall efficiency of the GST system in India.