Process Flow of Invoice Management System

To enable taxpayers to efficiently address invoice corrections/amendments with their suppliers through the portal, a new communication process called the Invoice Management System (IMS) has been introduced by the GSTN.  The facility has been made live on the GST portal with effect from 1st October 2024.

The IMS shall allow the taxpayer to take action on the invoice reflected in the IMS, i.e., the Recipient may mark the invoice as accepted or rejected or for later use. This makes it easier for taxpayers to manage their invoices. This helps simplify the reconciliation process and improves accuracy and efficiency in GST compliance.

This article discusses a detailed step-by-step guide with screenshots from the GST portal provided below to assist taxpayers in using the facility.

1. Access to Invoice Management Dashboard

• Once suppliers save an invoice in GSTR 1 / IFF  or 1A, that invoice will start appearing on the IMS dashboard of the recipient. 
• The IMS dashboard can be accessed at the following path post login on the GST portal:

Services > Returns > Invoice Management System (IMS) option.

• The invoice Management System (IMS) dashboard will be displayed on the screen. There are 2 sections :

1. Inward Supplies: Dashboard to view and act on inward supplies reported by your supplier in GSTR-1/IFF/GSTR-1A.
2. Outward Supplies: Dashboard to view the status of outward supplies reported based on action taken by your recipient which shall be made available shortly.

2. Access to Inward Supplies

• To view and manage inward supplies reported by your supplier in GSTR-1/IFF/GSTR-1A, click the “VIEW” button on the Inward Supplies tile on the dashboard.
• After clicking the “VIEW” button, an information message will appear stating that invoices with no action will be treated as accepted. Click the “OKAY” button to continue.

• When clicking the OKAY button, the summary page of Inward Supplies will be displayed on the screen.
• The “All Other ITC” tab will be selected by default. The taxpayer can click the “VIEW ADVISORY” tab to see the advisory or use the “HELP” button for clarifications and assistance.

• In the above picture, invoices saved or filed in GSTR-1/1A or IFF by the supplier and received in IMS are categorized into different sections. These sections are hyperlinks, and the taxpayer can click any link under the “Heading” column to view the corresponding saved/filed records in GSTR-1/IFF/GSTR-1A.
• The right-side columns display the number of invoices with actions such as accepted, rejected, pending, or no action taken. These summary numbers are hyperlinks, and taxpayers can click them to view and manage the respective records. Taxpayers can take actions (No Action, Accepted, Rejected, Pending) on these records. 
• By default, all saved/filed records in GSTR1/IFF/GSTR-1A come under the No Action column.

No Action: All invoices saved/filed by the supplier in their GSTR-1/IFF/GSTR-1A, on which no action has been taken by the recipient taxpayer, will remain under the “No Action” category.

Accepted: Number of invoices that are accepted by recipient taxpayer.

Rejected: Number of invoices that are rejected by recipient taxpayer.

Pending: Number of invoices that are marked pending by recipient taxpayer.

3. Action on Invoices reflecting in IMS

• On Clicking the “B2B-Invoices” hyperlink will display all records on the screen. 
• The taxpayer can use the ‘search’ feature to search any invoice based on GSTIN, invoice type (regular, SEZ, etc.), specific date ranges, source returns, and more. This enables taxpayers to take the desired action on the invoices.

• Taxpayers can take action on a record by directly clicking the buttons:
  1. A for Accepted,
  2. R for Rejected, and 
  3. P for Pending.
• The taxpayers need to click on the SAVE button to save the action taken on a record.

Bulk Selection 

• The recipient can also take bulk action by selecting the multiple records and choosing to accept, reject, or mark them as pending. 
• To select multiple records, check the box in the header. A popup will appear on the screen. You can click “Select all records of current page” to choose records on the current page or select the “Select all records of all pages” radio button to select all available records across all pages. Click on the PROCEED button to proceed.

• After selection, taxpayers can either accept, reject, or keep the said records pending by selecting the action from the header and clicking on the SAVE button.

Download available in Excel Format.

• The details in the section-wise tables can be downloaded in a simple Excel format by clicking the “DOWNLOAD EXCEL” button at the bottom. 
• The table is organized in a clear and straightforward format, allowing taxpayers to check and verify all records offline before taking any action.
• The taxpayer can also download the complete IMS table in Excel.

Reset of Records

• Action taken by the recipient can be revised by clicking on the “RESET” button at the bottom.
• Taxpayers can take action in a similar way as mentioned above for all other tables as well.

4. Generation of GSTR 2B

• The GST system will automatically generate a draft GSTR-2B on the 14th of the following month. This draft can be considered final if no action is taken by the recipient taxpayer. 
• However, if the recipient takes any action after the draft GSTR-2B is generated, they must recompute their GSTR-2B before filing GSTR-3B.
• The “COMPUTE GSTR-2B” button will be enabled after the 14th if the taxpayer makes any changes on the IMS dashboard. Taxpayers can click this button to recompute their GSTR-2B. 
• After recomputation, they can navigate to GSTR-2B to view the latest ITC details, which will auto-populate in GSTR-3B.

On clicking the COMPUTE GSTR-2B button a popup will be displayed on the screen. Click on the AGREE AND CONTINUE button to compute.

5. Outward Supplies

• Click on the VIEW button on the Outward Supplies tile to view the status of outward supplies reported based on action taken by your recipient.

• The Outward Supplies page will be displayed. Select the Financial Year and Return Period from the respective dropdown lists, then click the “SEARCH” button to proceed.

• A list of all B2B supplies reported in GSTR-1/IFF/GSTR-1A will be displayed in a tabular format. 
• Taxpayers can view various categories of B2B supplies reported in each table by clicking the descriptions.
• The number hyperlink under the “Number of Records” column represents the count of records added to the respective table.

• On Clicking the hyperlink will display all invoices reported in the table. Taxpayers can filter the list by using the Filter field or by entering keywords in the Search field. They can download the details in Excel format by clicking the “DOWNLOAD EXCEL” button and navigate back to the summary page by clicking the “BACK TO SUMMARY” button.

• Taxpayers can view and download the invoice details for all other tables as well as mentioned above.

Conclusion:

The invoice management system is indeed an action taken to enhance the correctness of ITC claimed by the taxpayer. However, in the case of numerous invoices, it can be difficult for the taxpayer to match all the invoices with IMS in 6 days only (14th of the following month till the due date of filing of GSTR-3B). However, IMS will turn out to be a game changer under GST.