Mandatory IMS: A Step-by-Step Guide for GST Businesses

The Invoice Management System on the GST portal is no longer optional. From April 1, 2026, every GST-registered business must use IMS to manage inward supplies before filing GSTR ThreeB.

If you have been ignoring the IMS tab on the GST portal, that approach will now cost you. Here is how IMS works, what actions you need to take, and what happens if you do not.

What IMS Does

IMS is a feature on the GST portal that gives you control over which supplier invoices flow into your GSTR TwoB (and therefore, which ITC you can claim).

Previously, all invoices reported by your suppliers in their GSTR One automatically appeared in your GSTR TwoB as available ITC. You had no way to dispute or reject an invoice at the portal level before it entered your ITC statement.

With IMS, you now review each inward invoice and decide its status before GSTR TwoB is generated.

The 3 Actions in IMS

When you log in to the GST portal and navigate to the IMS section, you will see all invoices reported by your suppliers. For each invoice, you have three options:

1. Accept

Confirming that the invoice is legitimate, you received the goods or services, and you want to claim ITC on it. Accepted invoices flow into GSTR TwoB Table 3 (ITC Available).

2. Reject

The invoice is incorrect, disputed, or you did not receive the supply. Rejected invoices do not flow into your GSTR TwoB. The supplier is notified of the rejection and can take corrective action (amend or cancel the invoice in their GSTR One).

3. Keep Pending

You are not sure about the invoice and need time to verify. Pending invoices are held and do not appear in GSTR TwoB for that period. They remain in IMS for action in a future period.

How Non-Action Works

This is critical: if you do not take any action on an invoice in IMS, the system treats it as accepted by default. The invoice will automatically flow into your GSTR TwoB as available ITC.

This means:

• If a supplier files a fake invoice against your GSTIN and you do not reject it in IMS, it appears as your available ITC
• If there is an amount mismatch and you do not flag it, the supplier's figure flows through
• If you received goods but the invoice details are wrong, the wrong details become part of your ITC record

Ignoring IMS is the same as accepting everything your suppliers report.

Step-by-Step: How to Use IMS

Step 1: Log In and Navigate to IMS

Log in to the GST portal (gst.gov.in) with your credentials. Go to Returns, then select Invoice Management System (IMS).

Step 2: Review the Invoice List

IMS shows all invoices reported by your suppliers in their GSTR One for the current period. Each invoice shows:

• Supplier GSTIN and name
• Invoice number and date
• Taxable value
• IGST, CGST, SGST, and cess amounts
• Place of supply

Step 3: Match Against Your Records

Compare each invoice in IMS against your purchase register or accounting records:

• Does the invoice number match?
• Is the amount correct?
• Did you actually receive the goods or services?
• Is the GST rate applied correctly?

Step 4: Take Action

For each invoice:

• Click Accept if everything matches
• Click Reject if the invoice is wrong, fake, or disputed
• Click Pending if you need more time to verify

Step 5: Complete Before GSTR TwoB Generation

GSTR TwoB is generated on the 14th of each month (for monthly filers). Complete all IMS actions before this date. Any invoice left without action will be auto-accepted.

Step 6: Verify GSTR TwoB

After GSTR TwoB is generated, review it to confirm that:

• Accepted invoices appear in Table 3 (ITC Available)
• Rejected invoices do not appear
• Pending invoices are excluded from this period

Impact on ITC Claims

IMS directly controls your ITC. The relationship is straightforward:

With the GST portal now enforcing hard blocks on ITC claims exceeding GSTR TwoB, your IMS actions directly determine whether your GSTR ThreeB filing goes through.

Common Mistakes to Avoid

1. Not Checking IMS at All

Many businesses have been ignoring IMS since it was introduced. Now that it is mandatory and directly affects GSTR TwoB, skipping IMS review means accepting every invoice blindly.

2. Bulk Accepting Without Verification

Some businesses accept all invoices without matching against their records. This can lead to accepting fraudulent invoices, which may trigger GST audit scrutiny.

3. Missing the GSTR TwoB Deadline

IMS actions must be completed before the 14th of each month. If you act on invoices after GSTR TwoB is generated, the changes apply to the next period, not the current one.

4. Not Following Up on Rejected Invoices

When you reject an invoice, the supplier sees the rejection. But if neither party follows up, the invoice remains in limbo. Coordinate with your supplier to issue a corrected invoice or credit note.

5. Ignoring Auto-Accepted Invoices

Review the auto-accepted invoices in GSTR TwoB. If any of them should have been rejected, you will need to reverse the ITC in a future GSTR ThreeB filing, which is more complicated than rejecting upfront.

IMS and the Zero Mismatch Policy

The Zero Mismatch Policy (effective April 2026) blocks GSTR ThreeB filing if ITC claimed exceeds GSTR TwoB. IMS is the first line of defense:

• By actively managing IMS, you ensure GSTR TwoB accurately reflects only legitimate ITC
• This makes GSTR ThreeB preparation straightforward since you are working with verified data
• Rejecting wrong invoices in IMS prevents them from inflating your GSTR TwoB, which could cause confusion during filing

Think of IMS as the input control and the Zero Mismatch Policy as the output check. Managing IMS properly prevents filing blocks at the GSTR ThreeB stage.

Timeline for Monthly IMS Workflow

Let Tax Garden Manage Your IMS

Reviewing every inward invoice monthly, matching against your books, and taking timely IMS actions requires consistent effort. Tax Garden's Compliance Standard plan includes IMS management, GSTR TwoB reconciliation, and GSTR ThreeB filing every month.