Invoice Management System (IMS) in GST: How to Use It

The GST Invoice Management System (IMS) gives buyers a formal way to respond to every invoice their suppliers report. Launched on the GST portal in October 2024, IMS lets a recipient accept, reject or keep pending each invoice, credit note and debit note saved by suppliers in GSTR-1, GSTR-1A or IFF. Those actions decide what appears in your GSTR-2B and therefore how much input tax credit (ITC) you can claim in GSTR-3B. This guide explains how IMS works, how each action affects both sides of a transaction, and a monthly routine that keeps your credit accurate.

Why IMS was introduced

Before IMS, GSTR-2B was a static statement: whatever suppliers reported appeared in it, and buyers had no structured way to dispute wrong or fake invoices. Buyers either claimed credit and risked notices, or left out wrong invoices and manually adjusted figures. IMS turns GSTR-2B into the result of a two-way conversation. Suppliers report, buyers respond, and the system computes eligible credit from the responses.

What appears in IMS

IMS shows inward supply records saved or filed by suppliers, including:

• B2B invoices and their amendments.
• Debit notes and credit notes, and their amendments.
• ECO-related supplies reported by e-commerce operators.
• Invoices from Input Service Distributors.
• Import of goods records, in the form the portal currently supports.

Some records do not flow through IMS, notably inward supplies under reverse charge, which you self-assess, and records where credit is not available because of the time limit under section 16(4) or the place of supply rules. These are still reported in GSTR-2B in separate sections.

The three actions and their effect

Action	Effect on your GSTR-2B	Effect on the supplier
Accept	Included in ITC available	No change; liability stays
Reject	Excluded from ITC	Supplier sees the rejection and can correct it in GSTR-1A or a later GSTR-1
Pending	Excluded from current GSTR-2B and carried forward	No immediate change
No action	Treated as deemed accepted when GSTR-2B is generated	No change

Pending is useful when goods have not arrived or you are waiting for clarification. A pending record stays in IMS until you act on it, but it cannot be kept pending indefinitely: time limits for claiming credit under section 16(4) still apply, and the portal has introduced restrictions on how long certain records, such as credit notes, can be kept pending. Check the latest advisory.

How IMS changes the GSTR-2B timeline

1. Suppliers save or file GSTR-1 or IFF for the period. Records appear in your IMS as they are saved.
2. You act on records throughout the month.
3. On the 14th of the following month, GSTR-2B is generated based on your actions as of that date, with no-action records deemed accepted.
4. If you change actions after the 14th but before filing GSTR-3B, you can ask the portal to recompute GSTR-2B.
5. GSTR-3B Table 4 is auto-populated from the final GSTR-2B.
6. Once GSTR-3B is filed, actions on records of that period are frozen.

Credit notes in IMS: handle with care

Credit notes reduce the supplier's liability and require the buyer to reduce or reverse ITC. If you accept a credit note, your ITC is reduced in GSTR-2B and the supplier's reduction stands. If you reject it, your ITC is not reduced and the supplier's liability is increased back, because the credit note is treated as not accepted. Rejecting a genuine credit note simply to keep ITC is not a valid use of IMS and will create disputes. The portal also allows recipients to declare the amount of ITC actually reversed against a credit note where it differs, for example where the original credit was never claimed; check the current options on the IMS screen.

Worked example

A Pune manufacturer sees these records in IMS for the month:

Record	Supplier	Taxable value	Tax	Situation	Action
Invoice A	Raw material supplier, Maharashtra	₹3,00,000	CGST ₹27,000 + SGST ₹27,000	Goods received, matches books	Accept
Invoice B	Packaging supplier, Gujarat	₹1,00,000	IGST ₹18,000	Goods in transit, expected next week	Pending
Invoice C	Unknown supplier, Delhi	₹50,000	IGST ₹9,000	No order or receipt; not our purchase	Reject
Credit note D	Raw material supplier, Maharashtra	₹40,000	CGST ₹3,600 + SGST ₹3,600	Agreed rate difference	Accept

ITC in GSTR-2B for the period: from Invoice A, CGST ₹27,000 and SGST ₹27,000; less credit note D, CGST ₹3,600 and SGST ₹3,600. Net ITC: CGST ₹23,400 and SGST ₹23,400, a total of ₹46,800. Invoice B's ₹18,000 IGST will be claimed in the month the goods arrive and it is accepted. Invoice C's supplier must fix its error; the manufacturer never claims that ₹9,000.

What suppliers should do after a rejection

1. Check the rejected record in the supplier's view and talk to the buyer.
2. If the invoice was reported to the wrong GSTIN or with wrong values, amend it through GSTR-1A (before filing GSTR-3B for that period) or in a later GSTR-1.
3. If the invoice was genuine and correct, resolve it commercially with the buyer and report it again if needed.
4. If a credit note is rejected, the liability it reduced is added back in GSTR-3B, so suppliers should resolve credit note disputes before the return date.

A monthly IMS routine for accounts teams

1. Weekly: download IMS data and match it against the purchase register and goods receipt notes.
2. Accept records that match and where goods or services have been received.
3. Keep pending records for goods in transit or under quality inspection, with a note of the reason.
4. Reject records that are not your purchases or have wrong values, and inform the supplier the same day.
5. By the 13th: clear as many records as possible before GSTR-2B generation.
6. After the 14th: review GSTR-2B, recompute if you changed actions, and reconcile with the books. Our GSTR-2B reconciliation guide shows the matching method.
7. Before GSTR-3B: confirm Table 4 figures and file.

Common IMS scenarios and the right action

Scenario	Recommended action	Reason
Invoice matches order and goods are received	Accept	Credit is eligible now
Invoice correct but goods arrive next month	Pending	Credit is available only after receipt
Invoice reported to your GSTIN by mistake	Reject	Not your purchase; supplier must correct
Invoice value higher than agreed	Reject and inform supplier	Supplier should amend to the correct value
Wrong tax head charged (CGST/SGST instead of IGST)	Reject and request correction	Credit of the wrong head cannot be used correctly
Credit note for an agreed discount	Accept	Reflects the commercial agreement
Credit note you do not recognise	Clarify with supplier before acting	Rejection affects the supplier's liability
Invoice for a blocked credit, such as staff food	Accept, but do not claim the blocked portion	The invoice is genuine; eligibility is decided separately

The last row is easy to get wrong. IMS answers the question "is this invoice genuinely mine and correct?" It does not decide eligibility. A genuine invoice for a blocked credit should be accepted and the credit then reported as ineligible or reversed in GSTR-3B.

The supplier's view of IMS

Suppliers also benefit from watching IMS outcomes. On the portal, a supplier can see which of its reported records have been rejected or kept pending by buyers. A sensible routine for a sales or receivables team is:

1. After filing GSTR-1, check buyer actions a few days before the buyer's GSTR-3B due date.
2. Call buyers who rejected records to understand why.
3. Correct genuine errors through GSTR-1A for the same period where possible, so the corrected liability flows into your own GSTR-3B.
4. Track credit notes that buyers have not accepted, because your liability may increase in GSTR-3B if they are rejected.
5. Link rejected invoices to the receivables ledger, because buyers rarely pay invoices they have rejected for GST purposes.

Common IMS mistakes

• Taking no action at all. Deemed acceptance means wrong invoices flow into your credit.
• Rejecting instead of keeping pending for invoices that are genuine but early. A rejection forces the supplier to report again.
• Rejecting genuine credit notes to protect credit. This shifts liability back to suppliers and invites disputes.
• Forgetting to recompute GSTR-2B after changing actions.
• Not communicating with suppliers, which turns small errors into payment delays.

How Fininvo helps

Fininvo ERP imports GSTR-2A/2B data from the GST portal and auto-matches it against your purchase register, flagging mismatches in invoice number, amount or tax so you know which IMS records to accept, keep pending or reject. Explore tax compliance, accounting and pricing.

General information, not tax advice. IMS functionality is evolving through GSTN advisories; check the portal and consult your CA.

Frequently Asked Questions

Is IMS mandatory?

Using IMS is optional in the sense that no action results in deemed acceptance. However, deemed acceptance carries the risk of claiming credit on wrong invoices, so active use is strongly recommended.

Can I change my IMS action after filing GSTR-3B?

No. Once GSTR-3B for a period is filed, actions on records that formed part of that GSTR-2B are frozen. Pending records carried forward can still be acted upon later.

Does IMS cover reverse charge invoices?

No. Reverse charge inward supplies are self-assessed by the recipient and are not actioned in IMS.

What if my supplier never fixes a rejected invoice?

You do not claim credit for it. If it was a genuine purchase, discuss with the supplier, as you will not get credit until a correct record appears in your GSTR-2B.

How is IMS related to GSTR-2B?

GSTR-2B is generated from your IMS actions. Accepted and no-action records form the ITC available; rejected and pending ones are excluded.