The Goods and Services Tax Network (GSTN) starting from 1st October 2024 will introduce with a new Invoice Management System (IMS) on the GST portal. The same new feature has the motive to ease how the taxpayers handle the invoices and claim the ITC.
IMS would allow taxpayers to accept, reject, or keep invoices pending straight via the portal.
In What Way Does the IMS (Invoice Management System) Work Under GST?
Once a supplier saves an invoice in their GSTR-1 then the same would appear in the IMS dashboard of the recipient assessee.
The recipient could choose to accept, reject, or leave the invoice pending.
Accepted invoices would automatically become the portion of the receiver’s GSTR-2B as eligible ITC, which would then populate in their GSTR-3B for the respective tax duration.
When there has been no measure towards an invoice, the same would be regarded as accepted and comprised in GSTR-2B.
This system would ensure that merely the genuine and verified invoices would contribute to the ITC claims lessening the errors and discrepancies in tax filings.
IMS Provides Numerous Benefits for GST Taxpayers
Let’s follow a few important new Invoice Management System (IMS) offers, which provide several advantages to taxpayers.
- Through the analysis of each invoice, before it becomes part of their ITC claims, the assessees can ensure precision and prevent issues during audits.
- Before filing their GSTR-3B, the assessee must act on the invoices.
- In the forthcoming tax periods, the pending invoices can be addressed.
- The IMS for those who use the quarterly return monthly payment (QRMP) scheme will integrate with their existing processes, which generate the GSTR-2B quarterly, in line with their filing schedule.
What Does the Same Mean for the Software Companies and GST Authorities?
The IMS depicts a transformation in the tax filing process that requires software companies to adapt their systems to align with the same new operationality.
The IMS for the tax authorities furnishes a clear and reliable system to track the ITC claims, which is directed to future automation opportunities.
AI-driven analysis and automated dispute resolution features can be feasible.
Tax experts remarked that the new advisory from GSTN shows a complete overhaul of the tax filing procedure.
It is tough to have a transition, however, it is important to adapt to the rising statutory environment.
Tax experts stressed that the same move can make the way for the forthcoming advancements in the GST system along with AI integration and rectified fraud detection.
